Enterprises today cannot collaborate in result value and quality chains

Business collaboration is an unsolvable problem of 20^th century enterprise management used today. Organizations, processes, systems, accounts, reporting and other structures laid over collaborating businesses conflict and employ inconsistent definitions and methods. The problem is addressed by laying other structures over the businesses for data reconciliation, information management, or a contrived multi-business process. This does not enable real collaboration, but allows reporting on what is occurring across the collaborating enterprises.

Business collaboration is impossible until businesses are managed

By definition business collaboration requires that first each business that is to collaborate is managed. The business is defined as “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. Each collaborator must manage the results of value and quality produced by the business, the capital of specific investment and operating costs utilized in the business, and the costs and effectivness of performance that produces each specific result.

Business management enables collaboration and management of shared value

When each collaborator manages the economic output results produced, capital investments implemented as solutions, and the performance of each solution to produce a result following 21^st century business management conventions, definitions, and standards, there can be real business collaboration. A result value and quality chain can be linked across businesses to produce each result where the best value and quality can be achieved, eliminate duplicated results, and control capital utilization to produce the maximum value-added in the final customer result from the chain. [more...]

Business processes and information systems laid over the business today prevent management of costs, value, and quality

20^th century management lays monolithic business processes and information systems over the business to manage business performance. Results produced by the business are defined as performance and are not specifically identified and managed as a set or chain leading to final results that go to the customer. This prevents to business from managing the cost of producing a result, the result value, the result quality, and the result value added. Much time and money is wasted trying to reconcile ill-defined processes and systems for business collaboration, since result chains cannot be organized or managed.

Rule No. 2 of the 10 rules of 21^st century business management: Generate profits from a chain of managed value and quality

21^st century business management organizes the capital investments available to be utilized in business performance, performance producing each result, and business output results as value-quality chains. This allows capital solutions to be utilized in cost-effective performance to produce value-quality results leading to high-value and high-quality customer results.

Customer results are outputs from managed result value-quality chains

Business management redefines business processes and information systems as process solutions by the results produced and manages each result in the result value-quality chain starting from input results from the supplier, result value added along the enterprise result chain, and the final result to the customer. Result value-added is managed across the chain to contribute directly to the profit result. The business can integrate and manage the chain to help suppliers meet enterprise input needs and to add more value by meeting customer needs. [more...]

Alignment is an unsolvable 20^th century enterprise management problem

Many books have been written offering solutions to the "alignment problem"; to align outsourced and internal solutions, processes and information systems with the business, capital development and business operations, customer solutions and the business, etc. Despite all the books the alignment problem continues unsolved today.

The business must be organized to provide the structure for alignment

The alignment problem cannot be solved because the business is not organized. Capital investments in the business are not identified as specific solutions. Solutions provided by other parties such as outsourced solution providers, business partners, or customers are not identified as solutions to be managed. The results produced by the solutions are not identified as a set of economic outputs from the business. Therefore, the business cannot be organized by aligning the internal and external solutions utilized in performance with the result produced.

Aligned solutions are integrated to produce results as part of the business

When the business is organized all capital invested in the business and all the outsourced, business partner, or customer solutions utilized are aligned and related to the results produced by the solution. The full set of solutions can then be integrated to work together to produce a specific result. The result manager is responsible to utilized the full set of internal and external solutions to ensure that the result is produced to meet solution performance expectations and achieve result goals. [more...]

The economic crisis is caused by the failure to manage the business and results as part of 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”. In order to manage the business, three components of the business must be managed; the capital investments in the business as capital solutions of worth, performance of the business in utilization of specific capital solutions to incur costs and produce specific results, and output results of managed value and quality produced across the business.

20^th century management utilized by all corporations, financial institutions, and other enterprises today do not identify or manage specific capital solution investments as a complete data set and do not identify or manage specific output results produced as another data set. Financial institutions are not able to manage "asset value" in the worth of solutions in their investment portfolios. Corporations are not able to manage diverse businesses within the corporation as part of an integrated and managed corporate business. These are examples of causes cited for business failures and downturns that caused the economic crisis.

Result-performance Management organizes and manages the actual business and results as part of the business

R-pM organizes and manages one integrated enterprise business structure. The business structure is comprised of the result structure to organize and relate results required for business success, the capital structure to organize capital solutions available, and the performance structure to implement the capital that is utilized to produce specific results.

The key component of the business structure is the result structure that organizes economic outputs to be managed for the volume, value, and quality that lead to revenue, profit, and stakeholder value results. All enterprise management responsibilities are to produce specific results. Strategies are organized by the strategic results to produce in the strategic result structure. A well-managed enterprise business must manage the value and quality of all results produced by the utilization of specifically-qualified and cost-effective capital solutions. [more...]

The economic crisis shows the problems with 20^th century Business Process Management

Financial institutions and other corporations state that they have problems due the the failure to manage asset value, full operating costs, and the margins in outputs produced. This is part of the basic problem causing the economic crisis, failure to manage the business. One of the major features of 20^th century management, Business Process Management, prevents management of the business. Corporations must manage processes and cannot manage specific capital investments, output results produced, and the performance of capital solutions utilized to produce a result.

Business processes must be replaced by result chains to manage costs, value, and quality

Rule 2 for 21^st Century Management is to: Generate revenues from a chain of known value. The rule says to define the results produced and manage each result in the result value-quality chain; starting from input results from the supplier, proceeding through result value added along the corporate chain, and ending at the final result to the customer. Business processes used today do not allow this. The corporation must redefine business processes by identifying the results produced and the capital solutions utilized within the process to isolate the most cost-effective performance to produce the highest value-quality result. Results must be managed result by result within a set to produce the input result to the customer value-quality chain.

R-pM manages result value-quality chains as part of the managed business

Result-performance Management is the only method to manage the corporate business and result value-quality chains to know full costs to produce a result, the value of the result, the value-added by performance as well as capital solution qualifications, performance effectiveness, and the quality result by result in the chain. R-pM ensures that customers receive managed value and quality in goods and services from the corporation. [more...]

The financial crisis is caused by business performance problems

Business performance used by financial institutions, corporations, and other enterprises today is a problem. Business performance is defined to include both the performance of the business in the utilization of capital and the output results produced by the business. Capital utilized in performance and results produced are mixed together in business processes, performance management, key performance indicators (KPI), and other business performance structures laid over the business. Business performance improvement stresses performance, performance quality, and the flow of performance without managing improvement to business results produced by the performance or the investment in capital solutions utilized by the business to manage investment returns and capital worth (also called asset value).

Business performance management prevents actual business management

Structures laid over the business hide actual business capital solutions, actual business performance, and actual business results produced. The business changes with each change to a result produced or new investments in capital solutions utilized. Business change cannot be managed and conflicts with overlaid structures causing unsolvable 20^th century management and performance problems.

R-pM converts performance management to Result-performance Management

Result-performance Management (R-pM) organizes the actual business through organized and managed capital solutions utilized in performance to produce specific results in a business structure. The one integrated business structure is used to manage the business for each part of the enterprise. The organized businesses within a larger enterprise add up the enterprise business structure. R-pM manages each business in the enterprise and the complete enterprise business to eliminate performance problems through 21^st century management. [more...]

The current financial crisis shows the need for actual best business management practices

After every corporate financial, management, or governance crisis or scandal the call arises for best business management practices. However, nobody knows what real best business management practices are, since no one has any experience in actually organizing and managing a business. The practices installed are never actual best business management practices, but are a collections of rules and regulations or methods to better manage structures that hide the business and prevent actual business management.

20^th century best practices are the best of bad business practices

20^th century best business practices are a collection of organization, process, system, and administration structures laid over the business for a particular purpose, which have proven effective elsewhere. All 20^th century best business practices are bad business practices, because they add to enterprise overheads and costs, and do not help the enterprise to operate or manage the actual business.

R-pM provides the business definitions and structure for good best practices

Result-performance Management (R-pM) instills best practices across the business for 21^st Century Management. R-pM manages the business by managing the capacity, investment, qualifications, reliability, return, and worth of capital solutions; utilization, cost, effectiveness, uncertainty, and value-added of each capital solution in guided performance; and the volume, total cost, quality, risk, value, and value-added of each result produced. The set of solutions deployed and utilized to produce a result is defined as a capital module. The capital module that produces the best value-quality result can be defined as a best practice. All best practices are then built into the business structure to operate and manage the actual business.

The only way to prevent future corporate financial, management, and governance problems is to use R-pM to organize and manage the businesses. Governments that want to improve local business competitiveness significantly and prevent future crises, must investigate R-pM. [more...]

Many methods and books have addressed the alignment problem, but the problem remains unsolvable

The 20^th century enterprise has contrived many methods and spent enormous sums to solve the alignment problem inherent in aligning performance with performance. Even after all this, the unsolvable alignment problem remains. In an early Article, we identified alignment as one of The Top Ten Problems with 20^th Century Management.

The alignment problem can be solved only by organizing the business to align capital utilized in performance with the result produced

The solution to the alignment problem is very simple. Follow the first rule of 21^st Century Management; organize and manage the business. Result-performance Management (R-pM) organizes the business in economic output results produced, investments in capital solutions to produce results, and the deployment, alignment, integration, and utilization of specific solutions to produce specific results. Capital solutions utilized to produce the same result are aligned. [more...]

Value has no value in 20^th century management used today

Value is an impressive word. People talk of value propositions, strategic value, value chains, value creation, and value management as if they were actually measuring and utilizing value as a day-to-day business metric. But looking further, we find that value is calculated from a contrived business overlay or formula.

20^th century enterprise organization and management prevents the utilization of value as a day-to-day business metric.

R-pM organizes the business to make value a manageable and valuable result metric

We must organize the business through Result-performance Management (R-pM) for day-to-day 21^st Century Management. Value is an attribute of output results produced by the utilization of capital in performance across the business. The value of input results from suppliers, plus each result in the business result chain, equals the value imparted to customer results in customer willingness to pay. [more...]

Capital solutions are not implemented today to produce specific benefits

Your enterprise likely has implemented information systems or major capital solutions. Were the benefits or return based on a quantified list of specific benefits and not just estimates of increased sales or revenues? Did users have goals to achieve the return on the investment? Were change management problems or resistance prevented by professionally-managed implementation of human and other solutions? Was professional support for all new or changed solutions established as the routine? Was the investment planning and capital development professionally managed? Were consultants utilized to achieve the return on the investment? Was the return on investment managed and measured?

20^th century management does not enable capital management and measured return on capital investments

If you can answer yes, your enterprise is a rare exception. 20^th century management has many inherent obstacles to overcome to implement new solutions to produce managed value-added to provide an measured return. The enterprise must organize and manage the business first, in order to manage change and improvement to the business effectively. Otherwise the enterprise will continue to implement new solutions to produce old problems.

R-pM organizes the business to implement specific capital solutions to add value to business result produced

The prior article showed how to design packaged solutions that any enterprise can use. In order to produce planned business benefits and gain the return, the business must be organized and managed using Result-performance Management (R-pM). Results must be defined to plan and manage value-added by implemented solutions. Capital solutions must be organized for professional support. Specific solutions required must be integrated and utilized in performance to produce specific results. The return on investment comes from added result value-added over the payback period compared to result value-added with no improvement. [more...]