Archive for the 'Project Management' topic

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

Identify and value results needed to justify investments and set result goals to manage the return on all investments

21^st century business management manages the economic outputs of the business as specific results and manages the invested capital utilized to produce results as specific capital solutions. [more...]

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...]

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...].

Business change and change management are unsolvable problems of 20^th century management used by business enterprises today. The unsolvable problems are caused because the actual business “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results” is not organized or managed. 20^th century management fails to define, organize, and manage the three components of the business.

• Results: The economic outputs of value produced from business performance
• Capital: Investments in the business to provide capital solutions of worth to be utilized in business performance
• Performance: The specific capital solutions utilized in performance to incur costs and to produce specific results

There are only two entities that change in business change and in capital development – results and capital solutions. All business decisions and changes involve results to produce from the business and the human and other capital solutions to utilize in performance to produce results.

If the business is not defined, organized, and managed it is impossible to change the actual business. Instead of changing the business and managing business change properly, 20^th century management lays structures over the business. The organize structure is laid over the business. This is a fatal error. Once an organization structure is laid over the business, the business cannot be managed. [more...]

According to the Business Change Forum “Investment analysis and capital development” is one of the top 10 problems of 20^th century management . This includes the problems with project management structures and systems.

Project management structures concentrate on managing activities and performance

Project management has always attempted to manage people, tasks, and activities. This is the cost side of the project. However, even with the attention to the cost side, there is no good method to manage costs. The benefit side is not managed.

The problems arise in investment analysis and capital development from three main sources:

1. Failure to plan and manage the economic outputs or results to be produced by utilizing the developed capital to set up value creation
2. Failure to define the capital being developed as specific solutions to be utilized in performance to produce economic outputs or results, to capture the cost of development, to set up specific capabilities to support and manage utilization of capital in operation, and to capture the cost of capital consumption in operations
3. Failure to organize and manage capital development projects as a business to utilize assigned capital in performance to produce project results as a sub-business of an enterprise result in progress like “implemented capital solution” or “development project in progress”

The failure to define results and performance solutions affects both the external management of the capital being developed by the project and the internal project management of performance solutions utilized to produce project results.

Project management problems arise because we do not organize and manage the business

These problems arise because we do not organize and manage the business. The precise definition of the enterprise business is “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. If we are going to plan, organize, or develop a business, including a project, we must plan, organize, and develop the three components of the business:

• Results: Specific economic outputs of value and quality produced at any level from business performance
• Capital: Specific invested capital available as solutions to be utilized in business performance
• Performance: Utilization of a specific solutions of worth to incur costs to produce specific results

20^th century capital development and project management structures manage the project to develop capital as tangible assets or a completed project, but do not manage the new results to be produced and the specific capital solutions needed to produce the results.< [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...].

The business is the utilization of capital as business solutions in performance to produce business results. Business results are the specific economic outputs of value. Results can be counted and may be measured in other ways. Results have attributes that define the quality, value, and other characteristics of the result. Results must be logically structured by the management responsibilities for results and by the overall objectives of results.

Results are organized into one enterprise result structure, containing all the results produced by the enterprise, and deactivated results that still have recorded value, costs, and other attributes. The result structure is managed by result organization relationships from end-results to set-results to key-results to show the reporting lines and relationships for managers responsible for results by level of management. The result structure is organized by result objective to organize revenue results, capital results, and investment results.

Special extracts from the result structure may use other result relationships and may be managed to focus on result sets, value-quality chains, result management or participation responsibility, result value evaluation, and other purposes.

The Result Structure is business organization capital to organize results produced by the actual business

The enterprise business organization consists of the business result structure and the business performance structure. [more...]

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.