Archive for the 'Benefiting from Business Change' topic

Capital Development Project Management is one of the top 10 problems of 20^th century enterprise management

20^th century enterprise management cannot plan, manage, or repay capital development projects

Capital development projects for internal management or business improvement today tend to be ad-hoc and conducted separate from the business. We have unsolvable problems in 20^th century capital development project planning, management, and return on the project investment, so we cannot:

• Plan and manage operations and development as an integrated continuum that is part of the business
• Itemize, plan, and achieve specific benefits from development projects
• Clearly and systemically understand what we must be implementing from projects as part of the business for ongoing management and return on investment
• Scope the project as part of the enterprise business to define specific results to add or improve and specific capital solutions to acquire, develop, or improve
• Plan the output results to be produced from the project in specific capital items to be implemented and utilized by the business
• Utilize users and administrative staff in proper roles in the project
• Utilize contractors and consultants as solutions in an enterprise-managed project
• Document and record the project so that all capital developed is fully documented and that knowledge required for use is created
• Manage the capital to be consumed and utilized in the project
• Manage the capital development project as a subsidiary business
• Record accurate development costs by capital item developed
• Implement project results as capital items for direct utilization by the business
• Measure the actual return of capital development investments overall and by capital solution utilized

The unsolvable 20^th century enterprise management problems hamper project management, particularly for enterprise internal capital development and management improvement.

Manage results to drive capital development and gain the return in result value created

Business management provides new breakthroughs for planning and managing enterprise capital development and planning and managing the capital development project.

Capital development develops two things:

• The capital to be utilized as solutions that incur costs
• The results to be produced by the developed capital to provide benefit and return

When we plan and manage a capital development project, we must plan and manage two things:

• The results to be produced by project performance
• The capital to be consumed and performance solutions to be utilized to perform the project

Business management utilizes Result-performance-Management knowledge and procedures to do both. [more...]

Information Technology is one of the top 10 problems of 20^th century management!

Information Technology incorporates a wide variety of unsolvable problems

Information Technology (IT) employed today has many inherent problems that many expensive solutions have never been able to solve:

• Information technology is managed as technology, rather than as capital preventing integration with the business
• Information technology employs large monolithic information systems that are laid over the business, instead of information processing solutions that are utilized by the business
• Information Technology defines different architectures to define and align the business, systems, hardware and networks, and data and information, rather than integrating each with the business
• Different categories of information capital are mixed in many systems using different entity names and definitions producing information complexity and preventing proper information capital management
• Since the business is not organized, information systems manage information related to structures laid over the business and do not capture, process, or report actual business data or report actual business management information
• Information Technology is difficult to manage because it mixes business, facility, and management capital that require diverse management and operating capabilities
• It is difficult to manage return on IT investments since the investments are lumped together and do not produce direct measured business improvements
• Information Technology has grown into a large expensive empire that involves much unnecessary processing, extensive overheads, and unsolvable problems

These problems can never be solved with 20^th century management that tries to improve the enterprise by laying new or improved structures over the business.

Information Technology problems disappear when organizing the business for 21^st century business management

The only way to eliminate the Information Technology problems is by organizing the business with to enable 21^st century business management. Information technology must be integrated in the business as capital defined as specific solutions utilized to produce specific business results. Business management enables the following measures to eliminate the unsolvable Information Technology problem:

• The actual business is organized as specific capital solutions, including IT solutions, utilized in performance to produce specific business results
• Information system solutions are defined and integrated with the business process as modules to produce a specific result or a chain of results
• Information systems focus on managing actual business data in result value and quality, performance cost and effectiveness, capital worth, and return on capital investments that is not processed today
• Information Technology is defined and organized as capital, with other capital of the same category, for proper capital management by those with the professional capability
• Information capital is defined and managed as business data, human knowledge, facility records, and management intelligence to produce information solutions needed by the business
• Enterprise information is integrated by capital solution utilized, result produced, supplier, customer, time period, business transaction, etc in an enterprise Business Information Base for one set of complete and accurate business information
• Information systems and processing devoted to managing arbitrary structures laid over the business and special systems to address problems in data reconciliation, information integration and extraction, and management reporting are discontinued, if not directly needed by the business
• New information system implementation integrates business and information processing with other capital solutions to produce specific output results needed by the business
• The business is organized for a new generation of 21^st century business management systems and business-information process modules, to process the actual business result by result, and provide one set of consistently-defined management information

Managing information technology as capital utilized by the actual business eliminates the unsolvable IT problems in business alignment, information complexity, data reconciliation, unknown costs and value, unknown capital worth and returns, CIO and IT management capabilities, data integration and control, and on and on.

The Information Technology Problem

Enterprise information systems include a wide variety of systems that are laid over the business

Since the business is not organized, different management structures must by laid over the business to manage the enterprise. [more...]

Change Management is one of the top 10 problems of 20^th century management!

Business change cannot be managed directly because the business is not managed

Business change is a mystery to the 20^th century enterprise because the business, the activity of providing goods and services, is not organized and managed. The enterprise is organized and managed through organization and management structures laid over the business. 20^th century “business change” is not change to the business, but is change to structures laid over the business. Most “business change” lays new organization, process, or system structures over the business with little positive change to the business itself. The rigid new and old structures are separately defined and conflict with each other and the actual changing business. Since the business is not managed, the value created by change cannot be planned or managed and the return on change investments cannot be measured.

The solution is to organize the business for direct management of business change

Business change is a change to either an output result produced by the business or a capital solution utilized in business performance. When the business is organized and managed, business change automatically reorganizes the business and can be managed as the routine. Business management organizes results and capital solutions to change the business as the daily routine. Business change projects involve capital development to increase the value of results or to enable new results, by implementing new or improved capital solutions. If the enterprise does not manage results and capital solutions utilized in performance, it is difficult to manage change to results, capital solutions, and performance.

The Change Management Problem

20^th century business change is change to overlaid organization and management structures

Even accepting 20^th century management change to overlaid organization, process, information system, account, performance management, and other structures, there are another set of problems. [more...]

20^th century enterprise management cannot plan and manage investments for a specific return

20^th century enterprise management used today concentrates on performance and the need for performance improvement. Development planning and execution concentrates on the capital needed for performance. Investments are directed primarily at tangible assets or achieving a project outcome. Return on investments cannot be calculated, since specific capital items and business improvements are not defined. So, potential increases in sales, revenues, etc are estimated to justify the investment. Project management manages the project separate from the business as an entity in itself.

20^th century enterprise management objective is capital development without managing the capital developed

20^th century enterprise management supposedly manages capital development. The managed capital developed is limited to capital that is managed, primarily in assets and employees. Most other capital is not managed or is classified as intangible assets. Development costs are not captured against the specific capital items to be utilized by the business to provide the return. [more...].

All capital development should develop capital, plus business results for return on investment

Every business enterprise must produce output results that lead to goods and service results to create value. An expanding enterprise must produce new results of increasing value. The enterprise needs additional capital in order to produce new results as part of the business. The capital must be acquired or developed, implemented as specific capital solutions, and then utilized to produce improved or new results of increased value. The value added to new business results must justify the capital expenditure to acquire or develop needed solutions and provide the return on investment.

All capital development is really result and capital development to develop capital as solutions to be utilized to create additional value in output results produced by the business. The additional value of output results provides the return on the capital development investment. If the capital solutions utilized and the results produced by business performance are not managed, result and capital development cannot be managed properly and the return on investment cannot be measured. Even physical capital development, like a new building, produces capital solutions to produce results, be it the enterprise office facility solution or a facility solution to produce lease or rental income results.

20^th century enterprise management does not organize or manage results or capital as sets

20^th century management used today does not manage the enterprise business, defined as “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. [more...].

Management consultants and their clients are unable to work together to improve actual business management

Many capital development, business change, and management improvement projects involve management consultants. Since the business is not defined, organized, or managed, management consultants cannot work with client enterprises to improve the actual business. Each management consulting firm has their own approaches and methodologies that are not related to the business and are not familiar to the enterprise client. Misunderstandings often arise over the scope of the project and the responsibilities of the consultant and the enterprise.

Management Consulting today faces many unsolvable problems that prevent scoped and measured business change

20^th century management improvement consulting projects have many fundamental and unsolvable problems, such as:

• The enterprise business is not organized, so there is no framework to scope and plan change projects and services
• The business results to improve are not known or managed for added-value
• The capital solutions to acquire, develop, and utilize are not known and managed
• Performance in the utilization of capital solutions to produce results is not defined or managed
• The specific changes needed for success can not be identified and managed
• Consultant services do not change the business, but change structures laid over the business
• The enterprise must learn new organization, plan, process, system, or performance structures with added terminology and definitions
• Changed structures are implemented to adds costs, but not to create value
• The value-added by consulting services is not measured to know success
• The enterprise lacks the capability to manage the investment in development and change
  
• The enterprise does not lead and participate properly to best take over changes
  
• Human and other capital is not managed for utilization allowing change problems
  

These are some common problems with organization and management structures and management consulting approaches utilized today for capital development, business change, and management improvements. Today, the enterprise client and consultant must work in good faith in an unmanaged business environment to produce ad-hoc changes that may or may not improve business results. Business organization and management consulting services tend to be led by the consultant and the client enterprise awaits a deliverable and then decides whether the deliverable is acceptable.

Enterprise clients and management consultants need to work together in partnership to improve the actual business

The enterprise and consultant need a way to define the development and improvements that will provide clear and measurable benefits to the enterprise. The only way is to base business management improvements and management consulting services on the actual business. A new management consulting model is needed that:

• Provides services to help the enterprise organize, manage, improve and develop the business for measured value-added benefit
• Provides a method for enterprises to lead and participate properly in business change
  
• Provides a clear framework to understand scope and means of participation for both parties
• Provides a way to plan and measure the value added by business change to know the return on specific capital investments
• Provides a method to plan, acquire, develop, improve, and utilize specific capital solutions required
• Provides the organization and approach that eliminates the fundamental problems in current business change
  
• Provides a methods and tools that both the enterprise and consultant understand and use
• Provides a means to plan and measure the value the consultant provides and the value-added success the enterprise achieves.< [more...].

20^th century management consulting propagates the problems that caused the economic crisis

Many capital development, business change, and management improvement programs involve management consultants. 20^th century management consulting services normally add to or change organization, account, or management structures laid over the business. Each consulting firm has their own approaches and methodologies that are not familiar to the enterprise client. Services tend to be led by the consultant, with limited client participation, and the client must await a deliverable. Misunderstandings often arise over the scope of the project and the responsibilities of the consultant and the enterprise. 20^th century management consulting does not enable clients to manage their actual business and propagates the problems that cause the current economic crisis.

21^st Century Business Management Consultants help enterprises prevent problems that cause economic crisis

21^st Century Business Management Consulting is based on helping enterprise clients organize and manage their business in “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. The current economic crisis is caused by one fundamental problem; the failure of financial institutions, corporations, and other enterprises to manage the business. 21^st Century Business Management Consulting is required to help client enterprises to organize and manage the business, and then to optimize the worth of solutions developed, the cost and effectiveness of solutions utilized in performance, the value and quality of results produced by the business, and the return on all capital solution investments.

21^st Century Business Management Consultants have a model to work in partnership with the enterprise

21^st Century Business Management Consultants work in partnership with enterprise clients in enterprise-led result-performance development projects to provide the needed capabilities and resources the enterprise lacks.  The enterprise and consultant define the development and improvements that provide planned and measured benefits to the enterprise, through a 21^st century business management consulting model that:

• Is based on organizing and managing the actual enterprise business
• Provides services to help the enterprise organize, manage, improve and develop the actual business for measured value-added benefit
• Provides a method for enterprise clients to lead and participate properly in business management improvement
• Provides a clear framework to understand scope and means of participation for both parties
• Provides the organization and approach that eliminates the fundamental problems in 20^th century business change and management consulting methods
• Provides methods and tools that both the enterprise and consultant understand and use
• Provides a means to plan and measure the value the consultant provides and the value-added success the enterprise achieves.
  

These standards cannot be met with 20^th century management structures and consulting approaches, since the structures hide the business, and there is no framework to scope change and measure the value produced from the specific scope of change.

Business management consulting organizes the actual business for 21^st Century Management

21^st Century Management Consulting is based on organizing and managing the actual enterprise business as one integrated and transparent business structure. [more...].

The economic crisis produced large investor losses

Several trillion dollars of investor funds were lost in the past six months. Investors, advisers, and experts point out many mistakes made, poor government oversight, the credit freeze, unknown asset value, investor greed, poor corporate governance, and other symptoms as the cause of investor losses. These mistakes are contributors, but not the cause of investor losses. Investment banks, investment funds, stock brokers, investment advisers, government regulators have demonstrated their lack of knowledge of what is really happening and the real cause of the financial and economic crisis and investor losses. They have demonstrated their inability to manage the problem or to identify real solutions. Blind investment professionals are leading blind investors.

Investors must look deep to understand the cause of loss to avoid future loss

Everyone looks for quick fixes and easy solutions every time there is a crisis, so the real fundamental problems continue unsolved. The fundamental problems require deep analysis and understanding of the actual business. Investors must understand the real reason for their losses. There is only on fundamental reason: the failure of financial institutions and other corporations to manage the business to plan the capital investments they must make to create value, manage the proper utilization of their investments to create value, and manage the results produced from their investments that provide value to investors.  Financial institutions and other corporations are not able to do this systematically. They cannot manage capital worth (often called asset value) in the future result cost absorption and result value-added from the utilization of investments and the result value-added to be available from the sale or disposal of the capital solution asset. They are unable to provide information on the transparent actual business for proper government supervision and informed investor decisions. Accounting accounts for cash in a contrived chart of accounts that is not related to the actual business. Arbitrary accounting principles, such as “mark to market” are employed instead of accounting for the business. Financial and risk models used are arbitrary and are not related to the business. Financial statements produced are inaccurate and limited and do not report the business to reveal problems.

Corporations lay structures over their business and manage the enterprise

All financial institutions and other corporations today employ dead-end 20^th century management. [more...].

Many of us have participated in business change projects. Likely, we share many experiences with the difficulties in gaining successful business change. We have read about many cases of problems and disasters.

Something must be wrong. Why after all this experience and the many stories of unsuccessful business change, do we continue to have problems? Have management consultants with their business change and system implementation methodologies provided the answer? Are the conventional methods we use adequate for business change management?

The real problems are fundamental in the way we organize the business. Conventional methods introduce unsolvable problems, so that no business change method or consultant methodology can work properly.

“Business change” is not change to the business, but change to structures laid over the business

The problems start with the fatal error of 20^th century management; the organization structure. [more...]

Investors are the big losers in the economic crisis

Corporate investors have lost trillions of US Dollars in the current economic crisis. The recession appears to be long and deep delaying any gains in a recovery. Investors need to understand the fundamental problem causing the widespread problems in financial institutions and corporations around the world. Corporate investors are up against conventional corporate management thinking, which propagates dead-end 20^th century management and prevents 21^st century business management. Every business in a corporation must be managed consistently to consolidate into one corporate business. Corporate shareholders must pressure corporate management to manage the actual corporate businesses to eliminate the problems that caused past and present crisis, and surely will cause future crisis.

Investors lose because they invest in corporations that do not organize, plan, direct, or control the business

The business is “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. Corporations do not manage the business today. They organize the corporation with an organization structure, plan with strategy and corporate plan structures, direct with function and process structures, control with account and quality structures, report with compliance and financial reporting structures. The structures laid over the business are not related to the business, often are not related to each other, consume enormous IT resources and costs, and do not collect or report actual data concerning the business.< [more...].