Abolish excessive Information Technology overheads

IT has become an enormous unmanageable overhead that creates business problems

In most corporations, Information Technology (IT) has grown into a large IT organization and overhead that carries out its own agenda, rather than managing capital to provide the solutions for users to produce results of value.

The following basic problems are inherent in IT today:

• Information systems do not manage the actual business, as one simplified and integrated business system, but manage management structures laid over the business by implementing many complex enterprise systems
• Information systems do not capture actual business data or provide consistent, complete, or accurate business management information
• IT administers diverse capital as technology and prevents proper capital management
• IT administers information as technology preventing proper information capital solutions

So, instead of spending thousands of dollars for the simple information systems needed to manage the actual business, corporations spend millions of dollars administering information technology and monolithic enterprise management systems.

IT systems do not manage the business, but manage structures laid over the business

20^th century management evolved long before IT existed to manage the actual business. Actual business data is produced by the utilization of invested capital as specific performance solutions that incur costs to produce economic outputs as specific business results that create value. It is difficult to capture and manage actual business data on the range of performance solutions and costs and the range of results and value manually, without information technology. So, the enterprise was managed, instead of the business, by laying separately contrived enterprise structures for organization, corporate planning, working methods and processes, accounts, administration, performance management, etc. over the actual business.

When IT evolved, no one applied IT to manage the actual business or capture actual business data. IT was applied, instead, to convert overlaid enterprise structures to the computer. IT enabled each separate overlaid structure to become more complex, until we have today’s complex business processes and information system structures, like SCM, MRP, ERP, CRM, etc., that hide the actual business and prevent actual business management.

Each overlaid structure describes the enterprise differently creating the information complexity problem

Each overlaid structure contrives its own separate set of duplicating and conflicting information entities that describe the enterprise and not the business (department, section, responsibility, target group, station, center, agency, business unit, etc.). Most of these contrived entities are irrelevant to the actual business, but are recorded by IT systems producing the enormous business and information complexity problems faced by corporations today. Much of the IT expenditure today is not on the processing, needed by users, but is on the systems, hardware, and specialists needed to manage the duplication and complexity of overlaid IT systems and to reconcile the massive irrelevant information maintained. The actual business and actual business data are not managed directly by any 20^th century enterprise information system.

IT administers diverse capital as technology, preventing proper capital management

We have well known problems today in the administration of diverse capital under the label Information Technology. Prior articles discussed the CIO problem. Application system processing and business data is administered as technology, instead of being managed as business capital. The information system hardware, operating software, networks, and other facilities are administered as technology, instead of being managed with other infrastructure as facility capital. Information Technology strategies and planning are separated from management strategy capital, hampering integrated strategic business planning.

IT administers information as technology, preventing proper information capital solutions

Much of today’s data, intelligence, and other information are administered as Information Technology preventing proper information capital management and solution development. Responsibility for information capital is confused between IT and administration, so that information capital is not developed and supported by professionals as separate data, knowledge, records, and intelligence.

Result-performance Management (R-pM) utilizes Information Technology for 21^st Century Management

Result-performance Management (R-pM) organizes the business for 21^st Century Management, to eliminate the Information Technology problem, through the following measures:

• R-pM manages the actual business as capital as performance solutions of worth utilized in performance to incur costs and to produce value in results. The actual business can be managed by a simple Result-performance Management System to manage one base of actual business data such as performance costs, result value, result value-added, and capital worth. The business is managed through six consistently-defined data entities
• R-pM manages other simplified application programs or redefines applicable enterprise systems as performance solutions integrated with the business process, where needed, to produce a specific result or set of results
• R-pM organizes all capital, including that administered as IT today, to be managed by professionals with the specific capability needed as business, human, facility, and management capital
• R-pM references all information produced in or entering the business, including emails, Internet search results and downloads, and transmitted files to a business entity for inclusion in one integrated Business Information Base.
• R-pM organizes information capital separately as business data, human knowledge, facility records, and management intelligence to apply proper support and solution development capabilities
• Information solutions are developed, referenced to a business entity like result and performance solution, delivered, and integrated as information capital to enable users to produce specific business results.

R-pM simplifies information systems, eliminates duplication and complexity, and abolishes the unneeded 20^th century IT overhead. This eliminates excessive costs and reduces the complete IT problem, so that there is no need for an separate IT organization. There is still need for IT capabilities, but they are placed where than can be effective as part of normal business operations and development. Information Technology is integrated with like capital to be properly managed and utilized as performance solutions to produce the results needed to create strategic value and ensure the success of the enterprise.

Learn about R-pM and obtain the R-pM Toolkit, your 21^st Century Management Manual, at Result-performance-Management.com