You manage your personal business to utilize your capital in performance to produce value in results

You use natural common-sense business management for your personal business. You do not lay structures over your business. You utilize your time, capability, and possessions as capital solutions in your performance to produce personal results, such as item purchased, enjoyed night out, or exercised and fit body. The value of the result must exceed the cost incurred in performance to be happy with the result. Your performance uncertainty risks poor or delayed results. Your input result quality and performance effectiveness determine output result quality, such as a repaired household item. You do not follow processes; you produce results, as needed, or along a chain to a final result.

But, when you get to work you must follow enterprise processes and procedures

When you get to work you are unable to apply your natural business management. The enterprise you work for has never defined or organized the business. Results produced across the business have never been identified as a set to be managed. Capital investments in the business have never been identified as specific capital solutions that can be utilized in performance to produce results. Therefore, you must follow the processes, procedures, and systems laid over the business to produce selected output results. You are unable to manage the common attributes of capital, performance, and results that produce actual business data or to obtain actual business management information that is needed to manage the business. [more...]

20^th century accounting does not keep complete or accurate financial records on the business

Today's enterprise faces many obstacles to professional record capital management because of several 20^th century management problems. Financial accounting is often seen as enterprise records management, but maintains a professional view of what it will record, and acts as an administrative function. Financial accounting records some financial data against a chart of accounts laid over the business. Financial accounting does not keep complete and accurate financial and non-financial records of the actual business. Most actual business data is not captured in financial, statistical, or cost accounts or other enterprise records today. Most other enterprise records are not maintained as information capital to be available to provide needed management information solutions. Problems with intangible assets, unknown value creation, unknown costs, unknown capital worth, inaccurate business net worth, etc have never been solved. Records management is a growing problem in today's enterprise requiring a comprehensive professional records management solution.

21^st century business management maintains complete and accurate financial and non-financial records of the actual business

Business data and record transactions are captured against one business structure to integrate organization, planning, directing, control, and reporting. Structures laid over the business and irrelevant bases of data collected against the structures are removed. Management information includes result value, performance costs, result value-added in excess of costs, capital worth, and capital investment returns that are "unknown" today. Tangible information capital is maintained as facility records to record all financial and non-financial business transactions and activity in computer records, documents, images, archives, etc. Accounting continues independently but can be incorporated as one sub-set of professional records management.

Business management provides an opportunity for accounting to broaden to professional records management

Managing the actual business provides a unique opportunity for the accounting profession to expand to professional records management and eliminate unsolvable accounting and financial management problems. Professional facility records management maintains financial and non-financial facility records of the actual business, and provides information capital solutions from records, where needed to produce results at all levels of business management. [more...]

Business information is inconsistent, incomplete, and inaccurate in today's enterprise

Enterprises have much to gain by properly organizing and leveraging information to provide value. Information is not managed properly for support and utilization in today’s enterprise. The business is not organized and managed to capture information produced directly by the business and to apply information directly to the business. The categories of information are not supported as information capital to produce business results. There are no precisely-defined data entities to integrate information from the various systems into a business information base for consistent management information. Most direct business data is never captured, management information is reported in conflicting and inaccurate sets, and actual business management information remains unknown.

The information complexity and accuracy problems are addressed by additional information technology investments

Each management structure and information system defines the enterprise differently producing the information complexity and accuracy problem. Large information technology investments for data reconciliation, enterprise information management, IT architectures, specialized knowledge and records management, etc produce excessive enterprise overheads and never solve the problems.

The managed business integrates actual data, knowledge, records, and intelligence in one Business Information Base

The only solution is to manage the business directly to capture actual business data and produce information capital solutions needed to manage the business directly. Business management provides the proper support for information capital to provide information solutions, to utilize solutions to capture data and apply information directly for the business, and to integrate information on the business in one consistent and accurate Business Information Base for transparent management and good corporate governance. [more...]

Corporations today are not able to manage their businesses as part of a corporation business

All business managers are familiar with such 20^th century management problems as unknown costs, unknown value and quality chains, unknown investment costs, unknown return on investments in specific capital items, unknown capital worth (asset value), intangible assets, inaccurate and missing management information, and on an on. These unsolvable problems are symptoms of the one fundamental corporate management problem the failure to manage the corporate business. Corporations today lay organization and management structures over the businesses at headquarters, division, subsidiary, and other levels that prevent management of corporate businesses. The various corporate businesses cannot be consolidated into one corporation business.

Business management at all levels is the only solution for effective corporation business management

Business management is the only method available to consolidate and manage the corporation business. Each part of the corporation must be organized and managed as a business. Businesses at a lower-level add into the businesses at a higher-level until the corporation is managed as one business with one complete, accurate, and transparent business structure. All 20^th century management structures laid over corporate businesses at all levels and the related unsolvable problems are left behind. [more...]

20^th century management does not maintain accurate financial and non-financial records on the actual business

Management needs complete and accurate information on the actual business for good corporate governance and business management. This is not possible with 20^th century management used today, which does not organize or manage the actual business. Records are not kept on the capital investments utilized as capital solutions by the business as a set or on the economic output results produced by the business as a set. Thus, there is no set of complete and accurate records on the business to provide actual business management information. Instead, information is maintained against contrived structures laid over the business, such as organization, planning, budget and account, and reporting structures.

Instead of accounting for the business, a chart of accounts is laid over the business. Accounting maintains a sub-set of enterprise records in financial and statistical accounts. The full cycle of performance costs incurred and result value created is not recorded. Many non-financial records that should be maintained are not considered as accounting responsibility and are never recorded and managed as information capital.

The records management problem is getting serious with the explosion in email, file transfers, and other records created, entering, and leaving the enterprise. The enterprise has no way to reference records to the actual business, to prevent records being lost due to information complexity, and to properly manage records as information capital.

Rule No. 4 for 21^st century business management: Keep financial and non-financial records on full business operations and development

21^st century business management requires accurate financial and non-financial records for the full cycle of business operations, along the chain of results produced by the business, and across the operation-development continuum. Business management maintains financial and non-financial records on the actual business to provide accurate and complete management information. The actual business is recorded so that one consistent set of accurate and complete facility records can be maintained on the business and accurate reports on the full business cycle of cost-effective performance producing value-quality results, the results from supplier-provided input results and through enterprise business results to final customer results, and the investment costs in new capital solutions and the return in new result value are provided. 21^st century business management broadens traditional accounting to professional records management for complete financial and non-financial business records. [more...]

20^th century enterprise management lays strategic structures over the business

20^th century enterprise management contrives structures to define the corporate strategy in corporate plans, maps, investment plans, IT plans, financial plans, and other structures laid over the business. The strategic business is not planned. The overlaid structures do not relate to the actual business and may conflict with structures used to manage the corporation. Strategic value numbers are pulled out of the air. There is no good method to govern the transition from the current corporate status to the strategic objective. Corporate governance cannot govern the actual business, so it governs through compliance with arbitrary rules and regulations.

Rule No. 6 for 21^st century business management: Plan and govern the transition from today’s value to approved strategic value.

The business is “investments in capital as solutions of worth utilized for cost and effectiveness of performance to produce value and quality in results”. The business must be planned to know the economic output results that must be produced for business success and the capital investments in the business that are required to produce the results. The business must be managed to know result value, full performance costs, result value-added, complete capital worth, capital investment returns for all solutions, and other essential business measures that are unknown today. The strategic business structure provides the foundation for planning the results to be produced and capital to be utilized at a 2-5 year strategic horizon. Strategic result value is substantiated in specific period by period result goals requiring growth in value of current results and the value of new results enabled by implementation of capital of worth.

Business goals are planned from the current to strategic business for management and good governance

21^st century business management enables good management and governance of the transition to the strategic business by reporting financial and non-financial status against result goals and performance expectations, updating strategic estimates, providing result evaluations and performance assessments, and providing management information on anticipated opportunities, threats, and developments. Good corporate governance ensures responsible business management and planned progress to the approved strategic business. [more...]

Actual business decisions are not supported by today's 20^th century enterprise management

All business decisions involve what do we want to accomplish in the business and how do we accomplish it. Each business decision seeks to answer the basic question: What specific output result is to be produced and what specific capital in human and other capital solutions are to be utilized to produce the result?

20^th century enterprise management used today does not support management decision-making. Results produced by the business and capital solutions utilized in business performance are not identified and managed as data sets or reported to management. Therefore, decisions cannot be implemented to change or improve the business. Changes are implemented through an organization structure, changes are executed through business process, information system, and function structures, changes are tracked through an account, costing, or quality structure, and changes are reported through financial statement and other management reporting structures. The actual decision is not recorded or reported.

Results produced and capital solutions utilized must be managed to implement, track, and measure management decisions

We can implement, followup, manage, and evaluate decisions made only if we implement, execute, track, measure, and report each specific result to be produced in the set of business results needed for business success; and the human and other capital investments utilized as specific capital solutions in the set of capital invested in the business. We must manage the value of the result produced, the cost of performance in producing each result in order to manage the value-added and other direct impacts of the decision on the business.

Organize the business as one business structure to manage all business decisions

Business management organizes business results produced and capital solutions utilized to produce each result. Management decisions are directly implemented, executed, tracked, measured, and evaluated. Good decisions are identified quickly and built upon. Bad decisions are identified quickly and changed. The business is flexible to quickly implement and change decisions to keep ahead of the competition. [more...]

Unreliable and inadequate accounting arises from failure to manage the business

Incomplete and inaccurate accounting is one of the major outgrowths from the failure to manage the business of enterprises today. Since the business is not managed, actual business transactions are not recorded and actual financial and non-financial management information is not reported. Many managers complain about the shortcomings of today's accounting, but the problems and shortcomings continue to be ignored by the accounting profession. Financial statements only report known capital and expenditures in whatever accounts are maintained, and often mislead management, shareholders, and regulators.

Today's accounting does not record the business or provide the information needed for business management

Significant problems arise due to the failure to account for capital invested in the business as specific solution investment balances, capital worth decline in performance costs as solutions are utilized or consumed, business result value and value-added after performance costs, return on solution investments as payback in costs and gain in result value-added, capital solution worth (asset value) in the value of utilization and disposal over the remaining life, and business performance statistics that add meaning to financial and cost records.

The business must be managed in order to account for the business

Since the business is not managed the business cannot be accounted for. The actual business structure in results produced, capital solution investments, and utilization of solutions to produce results provides the only valid business recording (or account) structure. In the absence of a valid structure, a generally-accepted chart of accounts is laid over the business for hit and miss 20^th century accounting to record actual and accrued cash expenditures and known capital. Therefore the first step to complete and accurate 21^st century financial, cost, statistical, and qualitative records management and accounting is to learn and organize the actual business. [more...]

Today, data is collected and information is reported against structures laid over the business

Today, companies and other enterprises collected data against organization, account, activity, process, information system, and other structures laid over every business. Enormous amounts of data is collected against the overlaid structures, but actual business data is never captured and actual business management information is never reported. Enterprise and corporation management is hampered by the overload of conflicting information on enterprise structures and the lack of management information on the actual business.

Business management captures actual business data and reports actual business management information

Business management captures one set of complete, consistent, and accurate data against the actual business structure and reports one set of relevant, complete, and accurate management information. Actual business information is reported at the enterprise business level and consolidated in the corporation business structure at the corporate level. Government business reporting requirements can consolidate consistently defined enterprise business data in government business structures by industry, economic sector, market, or economy.

Management has the complete and accurate information to manage and optimize the business and new investments in the business

Management has information that is not available today to manage the actual business. Capital investments are managed to provide the planned and measured return and to manage the ongoing worth of capital solutions utilization and eventual sale or disposal. This includes the "asset value" of capital investments in securities and other instruments to produce income, dividend, and growth results. Business operations are managed as result value-quality chains to manage result value-added across the business to produce profit and shareholder value results. Management has one set of management information needed for business organization, planning, direction, control, reporting, and governance. [more...]

Information Technology is a high-cost corporate overhead today

The typical corporation spends enormous sums on Information Technology and has many complex enterprise information systems, but still does not have an information system to manage the actual business, The corporation has much capital administered as IT instead of being managed for corporate benefit, and has much information administered as technology instead of being managed to provide information solutions for business and management results.

Reduce enterprise information systems to essential business processing and management

The key to proper information system utilization and information technology management is 21^st century business management. Result-performance Management (R-pM) provides the knowledge and procedures to use IT to manage the actual business as one simplified Business Management System. System processing routines or simplified application programs are designed and managed as capital solutions integrated with the business process, where needed, to produce a specific result. Other overlaid 20^th century information systems, duplicated and irrelevant information, and the need for a large IT overheads are eliminated. All capital, including IT and information capital, is developed and supported through capital management to produce specific results.

Manage data, knowledge, records, and intelligence as information capital

The managed business manages all information as capital to produce data, knowledge, record, and intelligence solutions needed to produce specific business results. All information in the enterprise references a business data entity as part of one integrated Business Information Base. Information technology capital, support, and capabilities are integrated as part of normal 21^st century business capital management, replacing the IT organization and eliminating excessive IT costs. [more...]