Managers today do not manage the business or make business decisions
Managers and directors may think that they manage the business and make business decisions. But, in fact, managers are unaware of the definition of the actual business or the components of the business. Managers have never been taught and do not have access to learning on actual business management and business decision-making.
Managers do not have the business context, business management experience, or actual business management information needed to make decisions directly related to the business, to implement business decisions to change the business, and to measure the results from decisions.
Managers use dead-end 20th century enterprise management to manage the enterprise and not the business. Organization and management structures are laid over the business to prevent business management. All management and decision-support information is reported against overlaid structures rather than the actual business. All management decisions made today are enterprise decisions based on changes to overlaid enterprise structures. Management decisions are implemented by changing organization, process, system, account, etc structures laid over the business or laying new performance management, IT architecture, records management, etc structures over the business.
Business decisions must involve the actual business and be implemented in the actual business
The actual business is not defined or managed today. 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”. The business has three components:
- Capital in the investments in specific solutions of worth available to the business
- Performance of the business in the utilization of capital that is implemented as a specific solution in a performance domain to produce a specific result and incur performance costs
- Results in the economic outputs of value produced by utilizing capital in business performance
Every current or strategic business decision boils down to what result to produce and what capital solution to utilize. Every business change is a change to a specific result produced or to the capital solutions utilized to produce results. Every business decision is implemented through a new or improved result or new or improved capital solution. Every business decision is recorded and measured in actual performance in the cost and effectiveness of the solution to produce value and quality results. Therefore, we must organize and manage the business as capital, performance domains, and results in order to make actual business decisions and manage business change.
Management has no context or information to support business decision-making
Business decisions must be made in the actual business context and by using actual business management information that does not exist under 20th century enterprise management. Output results are not defined as a set to be managed. Capital investments in tangible and intangible assets are not defined as a set to be managed. Business performance that produces business costs is not defined as specific solutions that produce specific results. Therefore, business performance cannot be managed or reported today.
In order to make informed business decisions management needs a context of results of known value produced across the business to decide on specific new or improved results needed. Management needs a context of the worth and costs of capital utilized as capital solutions in order to make actual business capital development decisions on specific solutions needed to create value in specific results. Management needs decision support information on the value and quality of results produced in value-quality chains and the cost and effectiveness of performance producing results. Management must gain experience with actual business management performance indicators and result metrics like performance costs, capital worth, solution performance against expectations, result value-added, result value returns on capital investments, result goal setting, customer result quality requirements, performance effectiveness, determined result quality, progress in creating strategic result value, strategic result value estimates, etc. Management cannot make informed business decisions without the context and information provided by the organized business.
21st century business management organizes the business to enable business decisions
No business schools or management books teach managers how to manage the actual business or how to make real business decisions. The only answer is 21st century business management to organize results produced across the business and the capital utilized in each solution to produce each result. Actual business data is generated each time a volume of full or partial results are produced in performance domain transactions that document solutions utilized to incur costs to produce value-quality results. Actual business management information in result value, costs, and value added is reported to support business decisions. Business decisions are implemented in new or improved results and capital solutions for actual business change.
Strategic decisions are implemented in the strategic business structure at a future horizon to plan strategic results and capital development required to provide specific capital solutions to produce new result value. Strategic decisions are substantiated through result goals by time period to implement solutions needed and to produce strategic result value. Management information is reported each period on progress to the strategic business and new strategic estimates to govern approved business decisions.
Result-performance Management (R-pM) provides the knowledge for actual business management
Result-performance Management (R-pM) is the only source of knowledge and expertise on how to manage the actual business. Forward-looking enterprises are now using R-pM guidance to organize and manage their business to gain breakthrough advantages over competitors burdened by unsolvable 20th century management problems. Business management is explained and documented in the Business Management Toolkit. The Toolkit provides procedures for actual business management and maintains emerging 21st century management conventions, definitions, and standards. Management consultants who base 21st century business management services on R-pM knowledge are licensed to help enterprises learn, organize, and manage the actual business. R-pM and business management are supported at result-performance-management.com.
The Solution to the Economic Crisis is explained in free downloads
Three free white papers explain the dead-end 20th century management problems, such as the failure to plan, account for, and manage the actual business, that caused the economic crisis, the way to eliminate the problems, and a government program to address the crisis by stimulating the economy, solving the problems, building a structure for financial and economic management, and organizing local businesses to flourish in the eventual recovery.
- How to Eliminate Problems that caused the Economic Crisis explains the major unsolvable 20th century management problems and the solution to eliminate the problems
- Business management; the only Solution to the Economic Crisis explains how to plan and manage the business to capture business data and provide management the information needed for actual business, corporation, industry, and economic management
- A Government Business Management Program to Answer the Economic Crisis outlines a government program to encourage business management, stimulate the economy, restore confidence, organize businesses to flourish in the recovery, and manage economic cycles to prevent future crisis
These three white paper downloads are available to R-pM Community Members at result-performance-management.com. There is no cost or obligation to join the R-pM Community. Join by entering your email address and personal password. Your email address is protected and used only for download problems, product updates, and occasional R-pM Member news and white papers.
