Redefining BPM: Why Results and Performance Must Be Separated
The June 2008 issue of BPM Business Performance Management Magazine carries a lead article, where I explain the business organization and management breakthrough with Result-performance Management (R-pM). The article, “Redefining BPM: Why Results and Performance must Be Separated”, explains the superiority of R-pM over 20th century management methods like BPM, be it business performance management or business process management. The article states “Many problems that plagued 20th century businesses — and continue to dog companies today — are by-products of those businesses’ lumping of the capital they utilize and the results they produce together as “performance” in their BPM”. The article explains problems with 20th century management and why R-pM as the only way to organize the business for 21st Century Management.
The 20th century definition of performance prevents business organization and management
One of the main problems of 20th century management methods like BPM is the definition of performance to include both the utilization of capital in actions executed and results accomplished. Performance management methods and Key Performance Indicators (KPI) mix together capital utilized, performance at an ongoing level, and results produced as economic outputs in a time period. This prevents the business defined as “the utilization of capital of worth in performance to incur costs and produce value in results” from being managed.
Results and performance must be separated to organize and manage the business
The article points out that results and the utilization of capital in performance must be separated and managed as three distinct entities in one business structure in order to organize and manage the business.
- Results: To manage the commonalities and value created in economic outputs from the business
- Capital: To manage the investments in specific performance solutions to know capital worth and return on investments
- Performance: To manage the utilization of a specific performance solution to incur costs to produce specific results
Result management manages the utilization of capital in performance solutions to produce results of value across the business. Capital management is one set of result management to develop and support the capital utilized as performance solutions. Performance management manages the provision and assists utilization of specific performance solutions to produce results across the business. Every domain of the business is managed for both the result produced and the performance solution utilized.
R-pM is the only way to organize and manage the business
The article explains R-pM the only way to organize and manage the business. R-pM manages result value-quality chains in the performance utilized to incur costs to produce each result in the chain and the result value-added across the chain to produce customer results. R-pM manages the value creation in the current business structure and progress to strategic value in the strategic business structure. All 20th century management structures laid over the business are eliminated and the enterprise concentrates on the utilization of capital of worth in performance to incur costs and produce value in results.
More and more business managers and consultants are employing R-pM for 21st Century Management
R-pM is gaining in acceptance among enterprises that want to organize and manage the business to leave unsolvable 20th century management problems behind. Management consultants are licensing R-pM to support enterprise customers in the implementation and utilization of R-pM. Solution providers are evaluating R-pM for new business software, education, and management solutions that any enterprise capital utilize to produce results.
Details on R-pM are available at result-performance-management.com
Read the article to learn the rationale for using R-pM from the performance management perspective. R-pM is explained further at result-performance-management.com. The R-pM Toolkit is available today to provide the details on R-pM to guide consultants, solution providers, and the enterprise to organize and manage the actual business and to provide common solution and services any business can use.
