Archive for the 'Investing in a Changing Enterprise' topic

R-pM is a breakthrough to manage the actual business and leave 20^th century management problems behind

R-pM organizes and manages the actual business, “the utilization of capital of worth in performance to incur costs and produce value in results”, without 20^th century management problems with reorganization, business change, business and information complexity, complex and costly IT infrastructures, unknown costs and value, unknown capital worth and returns, excessive overheads and costs from overlaid structures, and on and on.

R-pM is a new natural business perspective requiring little investment or risk

R-pM minimizes capital to that required by the business, optimizes business performance to reduce performance costs and increase result value, and manages result value-quality chains to produce customer input results. R-pM provides enormous competitive advantage, while the investment and risk is minimal. R-pM is mainly a change in thinking, which requires time to take hold. Human capital learns to operate and manage the actual business, instead of structures laid over the business. Existing information systems likely can be utilized as business process solutions, if the business is properly defined and organized.

The existing business is gradually redefined into result value-quality chains and one integrated business structure. Obsolete structures laid over the business and unsolvable 20^th century management problems are gradually abolished. As the enterprise learns R-pM, implementation accelerates and the competitive advantage of R-pM increases until the complete business is organized for 21^st Century Management.

Owners, investors, shareholders, lenders and others with a financial interest must lead the way to manage the actual business

Business owners, shareholders, potential investors, lenders, etc have the most to gain by being among the first to use R-pM. [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 performance 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 performance 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 performance solutions utilized and the results produced by the business 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 performance 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 management does not organize or manage results or performance

20^th century management does not manage the enterprise business, defined as “the utilization of capital of worth in performance to incur costs and produce value in results”. The business has three components: 1. capital available as performance solutions, 2. results required, and 3. performance in the utilization of a specific solution to incur costs and produce value in a specific result.

20^th century management does not define specific results produced and performance solutions utilized to be managed as sets. Added result value cannot be managed to provide benefits and specific performance solutions developed cannot be managed to know costs. Capital development is a difficult exercise separate from the business context to develop performance or tangible assets to produce some estimated return on investment. Much capital development and performance solution implementations fail to create the added result value needed for the return on investment.

R-pM manages result and capital development as part of the business for measured and managed return

The answer for all future result-capital development is Result-performance Management (R-pM) to organize the business for 21^st Century Management. R-pM manages performance solutions utilized and the business results produced to plan and manage the value added to results. R-pM provides 21^st century Result-performance Development to manage new performance solution development to produce new or improved results. R-pM manages each result-capital development project as part of the business with its own project business structure. R-pM manages implemented solution development and operating costs and the additional value-added to results to measure the actual return on investments. R-pM is the essential approach for any new result-capital development. It is all described in The R-pM Toolkit, your 21^st Century Management Manual

Result-capital development arises from the business requirements to improve results or produce new results

Result-performance Development is initiated by result symptoms in missing or deficient results. [more...].

Investment Analysis is one of the top 10 problems of 20^th century management

20^th century investment analysis cannot plan the actual return on investments

How does your company analyze strategic investments in capital development? Does your company perform a cost-benefit analysis? Are all the specific investments needed for business success planned? Are the costs of the investment analyzed, itemized, and scheduled? Are the benefits of the investment analyzed, itemized, and scheduled? Is the value to be added to the business planned and set up as goals to menage the return on investment?

For the most part, 20^th century investment management cannot itemize the costs or benefits of investment, particularly investments in management improvement and business change. Costs are project expenditures rather than investments in specifically-identified capital items. Benefits are usually estimates of increases in revenues or reductions in costs.

R-pM plans and manages the return on all investments through Result-performance Development

Result-performance Management (R-pM) manages the economic outputs of the business as specific results and manages the invested capital utilized to produce results as specific performance solutions. The benefits of development investments come from adding value to specific existing or new results. The cost of investments come from developing the capital needed as specific performance solutions to produce each result. The return on investments come from [more...]

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

When people talk about business organization, business management, or business change they think they are talking about organizing, managing, or changing the actual business. But, the fact is that they are not talking about the actual business. The enterprise business, defined as ‘the activity of providing goods and services“, has never been organized or managed.

They are talking about enterprise structures laid over the business. The organization structure does not organize the business. A structure is laid over the business to organize the enterprise. The business changes while the organization structure remains rigid. Reorganization and related change management is not business change. It is change to the overlaid organization to align a new structure closer to the actual business. The organization structure is the fatal error of 20^th century management that prevents the business from being managed.< [more...].

20^th century management does not provide a means to directly manage capital development or business change projects. The results enabled by development and the capital developed are mixed together as performance and are not managed properly. There is no way to itemize investment and business change benefits, plan and control actual development costs, plan the return on investment, or measure the actual return. There is no way to integrate the project and capital development with the actual business. There is no way to manage the enterprise properly as a business, or to manage projects properly as a subsidiary business.

These problems are eliminated by Result-performance Management (R-pM), a breakthrough to enable you to manage projects properly. It is all explained in the download “How to Manage Projects in the 21st Century”, available at result-performance-management.com. The download explains how to plan and manage the new performance to be developed and results of value to be produced by the enterprise business. The download also explains how to plan and manage project performance to produce project results, which are the solutions to improve and add value to enterprise results.

R-pM manages one integrated Enterprise Business Structure

R-pM is a significant breakthrough with one simple objective: to organize the enterprise business for 21^st Century Management, in an easy-to-manage Enterprise Business Structure, defined by only two entities:

• Results: Specific economic outputs that must be produced by business performance
• Performance Solutions: Specific capital that must be utilized in performance to produce results

Results are the inputs to and the outputs from performance. [more...]

20^th century capital development is not integrated with the business

20^th century management provides no business framework for capital development, particularly for new solutions that must be integrated with the business. Most capital is not recorded as capital. Much capital is considered as “intangible assets” and is ignored. There is no direct management of capital developed to provide the return on capital development investments. Capital is developed as a fixed asset or simply as a project outcome.

Most development is performed as an ad-hoc project, and managed as an isolated undertaking to implement new structures and solutions over the business. This makes it difficult to manage the relationship between the project and the business, gain business user acceptance of new solutions implemented, and plan and measure return on the capital development investment. A previous post in this series discussed the Logic of Business Change, which provides some background.

Capital is developed and utilized to produce business results

The purpose of enterprise capital is to provide the performance solutions needed by the business to produce value in business results. [more...].

Corporate investors invest in high overhead 20^th Century Corporations that do not manage the business

Last month, we discussed “How the Business Owner Benefits from R-pM“. This month, we take the different perspective of the corporate investor and shareholder.

Corporate investors invest in corporations that do not manage their business and are burdened with many unwieldy overhead structures. Corporate shareholders have to incur the costs of the many unsolvable 20^th century problems, described at the Business Change Forum. Every article posted shows different unnecessary costs absorbed by the 20^th century Corporation that ultimately reduce shareholder value.

Corporate investors benefit by investing in 21^st Century Corporations

Many corporations are researching Result-performance Management (R-pM) and making plans to move to 21^st Century Management, so corporate investors should watch for announcements.

21^st Century Management with R-pM provides many advantages to the Corporation and the Corporate Investor that no 20^th century corporation provides today, such as.

• An organized and directly managed business with one integrated and transparent business structure that shows capital in performance solutions utilized to produce results, at selectable levels of summarization or detail
• Abolished costs and overheads by removing the costly and irrelevant overlaid structures that prevent business management and cause unsolvable problems
• A clear value-creation strategy described in a strategic business structure showing strategic result value and the planned capital development for specific performance solutions needed to create result value, by time period as needed
• Complete and accurate financial and non-financial business records on relevant result value created, performance costs incurred, result value added, corporate and capital worth, result quality, performance effectiveness, result goals, performance expectations, result symptoms, performance problems, etc.
• Result value-added management to manage result value less all performance costs for all results between supplier-provided input results, through the enterprise result value-quality chains to final results that are customer input results
• Good corporate governance directed at period by period result and performance development and result value creation to achieve the approved result value established in the strategic business structure
• Managed shareholder value result that is continually updated from result value created and performance costs incurred
• Flexibility for fast change, since change is simply a matter of producing new results and utilizing new solutions in an updated business structure
• Streamlined information capital maintained on only those entities relevant to actual business management and timely information solutions to utilize performance solutions effectively to produce quality results
• Significantly reduced information technology overheads by focusing on those few information systems needed to directly manage the business and by properly managing capital that is now managed as information technology
• Eliminated administration overheads by managing capital management results, plus performance management results to provide qualified solutions
• Significantly reduced costs and capital requirements by focusing on only the performance solutions needed to produce value-quality justified results
• Optimized utilization of capital to produce results through professional capital performance management and result and performance optimization
• Planned and justified investment and capital development management to produce the specifically itemized result value from developed performance solutions, supported by result goals that are set to achieve the planned return on every investment and capital development project

These are just a few of the advantages of R-pM to the corporate investor that are not possible with rigid structures laid over the business of the 20^th century Corporation.

When will the Corporations you invest in now move to 21^st Century Management

There are two considerations for the corporate investor on moving to 21^st Century Management.

• When will the Corporations they invest in move to 21^st Century Management to gain competitive advantage and increased profit and shareholder value results
• When will the industry competitors move to 21^st Century Management, putting the Corporation and their shareholders at a significant disadvantage

Check with the Corporations in which you have invested. Chances are, you will find strong resistance to improvement and 21^st Century Management. But, maybe you will be fortunate enough to discover and invest in the forward-looking corporations that are working with R-pM to organize their business for 21^st Century Management. These corporations will have significant cost-effective performance and value-quality result advantages over 20^th century corporations, still held back by unsolvable problems.

The information to learn and use R-pM is in the R-pM Toolkit

R-pM is the future of business management. You likely still need a better understanding of R-pM. Go to result-performance-management.com to learn more under What is R-pM?. The guidance you, and the corporations you invest in, need to learn R-pM and gain immediate advantage from R-pM is provided in the R-pM Toolkit, the 21^st Century Management Manual, at result-performance-management.com. The R-pM Toolkit is offered at a nominal cost to encourage wide individual research into R-pM and wide corporate use of R-pM. .

The accepted definition of business is the “Activity of providing Goods and Services”

The generally accepted definition of business in on-line dictionaries is “the activity of providing goods and services”. If we start from this definition, we see that the business actually has two components:

1. “The activity of providing”, which is the action of business performance in the utilization of human and other capital
2. “The goods and services provided”, which are the outputs or business results produced from performance that can be counted and measured

So in order to manage the business, “the activity of providing” and “the goods and services provided” must be managed.

“Activity of providing” is the action of business performance in the utilization of capital invested in the business

“The activity of providing” is the business performance that utilizes capital. People perform using such business solutions as business processes, systems, knowledge, equipment, supplies, plans, tactics, and information. The people are human capital that are developed and paid by the business. People use business performance solutions provided by capital investments in the business. So, business performance utilizes human and other capital invested in the business.

The capital must be organized and managed as business performance solutions that can be utilized by people. The utilization of specific solutions to produce specific results can be explained through human knowledge solutions. The most important capital is human capital, but other capital must be managed properly to utilize capital available, to capture performance costs incurred in utilizing the capital, and to determine the returns on capital investments.< [more...].

New enterprises must not waste that precious “green field” advantage

Every day new enterprises are being organized around the world. Virtually all of these new enterprises employ obsolete conventional methods and doom themselves to the burden the unsolvable 20^th century problems discussed here at the Business Change Forum. These enterprises waste the precious “green field” advantage of no legacy structures and the opportunity to do it right from the start.

Conventional wisdom says copy a business model and do not “reinvent the wheel”. The model involves products, marketing, customers, etc. The business must be organized within the business model.

Management consultants are still recommending that new enterprises overlay conventional organization and management structures, rather than organizing and managing the business for significant competitive advantage.

Managers and consultants must employ the best structure available to protect future shareholder worth

Any manager or management consultant involved in organizing a new enterprise has a duty to study all options to protect the worth of the shareholders’ investment. Most will take refuge in convention and rely on the excuse that they did what everybody else does. But, the capable professional will learn and use the best organization and management structure available.

The best organization and management structure is the enterprise business

There is no better organization and management structure than the enterprise’s own business. So before making the fatal error of overlaying an arbitrary organization structure of organization units, positions, etc. on the business, the new enterprise must organize the actual business with R-pM. [more...]M.

There are many methods for capital development project management, but they all have difficulty planning and developing specific project benefits, gathering development costs for specific capital to be utilized in operations, and relating the costs of specific performance solutions developed to the actual benefits provided in operation to measure the return on investment. We have discussed these difficulties in many “Capital Development Plans and Projects” posts in the Business Change Forum.

21^st Century Management manages investments to gain a planned result value return

Rule No. 7 of The 10 rules of 21^st Century Management with R-pM: Manage investments to gain a planned return. The enterprise cannot manage the benefits of development unless the specific results to be produced by the developed capital are defined and managed. The enterprise cannot manage costs against the benefit to know the specific return on investment, unless the specific performance solutions being developed are defined and managed.

Result-performance Management (R-pM) is the conventional method to organize the business for 21^st Century Management. R-pM uses unique bottom-up Result-performance Development to develop both the costs and benefits of development, so that they can be tracked into operation to provide the planned and managed return on investment.

R-pM provides a business structure for capital development project results produced and performance solutions utilized for effective project management and to capture of costs of new solutions developed as project results.

Do not attempt any capital development project without studying and understanding the benefits of R-pM as summarized in the article “R-pM for Capital Development Project Management” in 21^st Century Management Magazine.

21^st Century Management eliminates 20^th century problems

Result-performance Management (R-pM) eliminates the capital development problem and other costly 20^th century problems. Slash costs, simplify business management, and boost competitive advantage through R-pM, the conventional method for 21^st Century management.

Download your 21^st Century Management Manual today

Your 21^st Century Management Manual, The R-pM Toolkit, is available today and is under continual development to expand and refine 21^st Century Management. The R-pM Toolkit explains how to manage capital development projects with R-pM to know the results being improved and the performance solutions being developed to add future value to the results for the value-added return. Get your R-pM Toolkit, and future updates, at result-performance-management.com.