Record Business Data, stop recording Irrelevant Corporate Data

The corporation is overwhelmed with “Management Information”

The corporation is organized through an organization structure and is managed through additional structures for corporate strategy, financial accounting, asset management, human resource management, business process management, performance management, supply chain management, production and logistics management, customer relationship management, cost accounting, project management, management information, and so on.

20^th century information systems to not manage the actual business, but manage structures laid over the business. Each structure defines a different set of information entities that must be managed. The organization is departments, functions, and positions; the strategy is objectives, operations, and target groups; the chart of accounts is centers, objects, and codes; the process is activities, stations, and checkpoints. Each of the many other structures adds on more information entities that require more work to record and process data. Large data bases are maintained on these entities and mountains of reports can be produced. Large IT investments in hardware and networks, IT architectures, data reconciliation and information management systems, etc are required to process corporate data.

Information is used to manage the corporation, and not the business

The objective or 20^th century management is to organize and manage the corporation, rather than the business of the corporation. The corporation can be managed in any of an infinite variety of ways, through a variety of contrived structures, recording a variety of data on different entities, and often overwhelming management with confusing information.

Despite all the structures and records, the 20^th century corporation does not record the sets of relevant data on the actual business and report the one complete, consistent, and accurate set of management information needed to manage the business.

21^st century management manages the business to manage the corporation

The objective of 21^st century management is to organize and manage the business of the corporation. The business includes everything that the corporation does, so managing the business also manages the corporation. The business consists of only three components to be managed. The complete business, with all transactions and outside interactions, with all strategies and plans, with all investments and development, can be managed through six information sets. Once the business is organized and managed, all the irrelevant structures and information reported to manage the corporation, along with all the wasteful IT resources can be abolished.

R-pM organizes the actual business to capture business data

The actual corporate business is the utilization of capital of worth in performance to incur costs and produce value in results. Result-performance Management (R-pM) organizes and manages the three components of business:

• Results: Specific current or planned economic outputs that must be produced by business performance
• Capital: Specific current or planned performance solutions that must be utilized in performance to produce specific results
• Performance: The specific performance solution deployed to produce a specific result to define a performance domain with rules and exceptions

Results are the inputs to and the outputs from performance. A result is a specific accomplishment, like customer order recorded, that can be counted and measured. Capital is available through business performance solutions to produce results. Performance is the deployment and utilization of a performance solutions to produce a result in a performance domain. A performance solution is an item of capital, like a human salesmanship capability solution, utilized at a performance domain to produce a result, like customer order recorded. The business organization is updated with each change to a result, capital in a performance solution, or performance in solution deployment to produce a result.

The corporation today does not organize and manage results as an information entity with all results produced defined in one set. Because of this, the corporation cannot manage the commonalities and attributes of results for business and management information. The results, perceived to be the most important are managed separately as distinct entities such as material, product, order, invoice, or revenue.

Results contain the corporate attributes for value, quality, volumes, risk, responsibility, value-added, customer, strategic rationale, etc. If results are not managed as a set, results cannot be related, compared, or managed.

The corporation does organize and manage capital as an information entity with all performance solutions utilized defined in one set. Because of this, the corporation cannot manage the commonality and attributes of performance solutions for business and management information. The performance solutions, perceived to be the most important are administered separately as entities such as employees, assets, cash, etc. Other performance solutions are not defined and, collectively, may be called “intangible assets”.

Performance solutions contain corporate attributes for cost, effectiveness, capacity, uncertainty, support, capability, etc. Performance solutions are related by the capabilities needed to support the solution, and by the way solutions are utilized to produce specific results. If performance solutions are not managed as one set, solutions cannot be managed for support, or aligned and integrated to produce specific results.

20^th century management used today defines both capital utilization in the execution of actions and the output results accomplished as performance. This definition prevents separate management of capital, results, and performance. Performance must be managed as the utilization of a specific performance solution to produce a specific result to form a performance domain.

Performance defines the specific occurrence of a cost, performance effectiveness, performance uncertainty, or performance problems. Performance generates basic business data that updates the performance record, capital record, and result record. If performance is not managed as a set, the fundamental activity of the business cannot be managed.

R-pM records detailed business data not recorded today

R-pM focuses on recording data and providing management information on the actual business.

R-pM manages the set of performance domain records from basic data produced from performance, such as:

• Performance cost rules: The ruled for charging development or operating costs for the solution to the result
• Performance costs: The cost incurred by the utilization of the specific solution to produce the specific result
• Performance transaction count: The count of business transactions for utilization of the solution to produce the result that contain the performance details
• Capital consumed: The amount of capital, such as human personnel time, provided against the result
• Performance exceptions: Descriptions of exceptions from standard solution performance for the result
• Exceptions encountered: Performance ineffectiveness, uncertainty, or problems encountered

R-pM manages results in the set of results records with data, such as:

• Result volumes: The counts and other metrics that describe the number and size of results against capacity available
• Result value: The value set and maintained from what the customer will pay
• Result quality: Quality standards or determinates established, with metrics to record actual quality
• Result goals: The count, other volume, or value to be produced in a time period
• Actual result volume: The actual count or volume of results produced by time period
• Result transaction count: The count of business transactions with supporting details updating the specific result
• Total value produced: The total value of results produced by time period
• Result total cost: The performance costs recorded by time period for all solutions utilized to know total result costs
• Result value-added: The value created by period compared with the total cost to know value added and manage cases of low or negative value added
• Result actual: The actual progress or status against result goals
• Result risk: The obstacles, problems, or performance uncertainty that may or actually prevent a successful result to adjust the result or performance solutions deployed
• Result incidents: Instances of particularly good or bad results and knowledge indicating how to produce a high-value quality result

R-pM manage performance solutions in the set of capital with data, such as:

• Solution capacity: Indicators that indicate limitations in producing a volume of known results
• Solution costs: Operating or development costs established for a result, result set, instance of use, time utilization, etc.
• Performance expectations: Levels of performance expected over time for the solution
• Unamortized balance: The development costs for developed solutions still to be charged to results produced over the remaining solution life
• Capital transaction count: The count of business transactions with supporting detail for updating the performance solution
• Performance costs incurred: The total performance costs for utilization of the solution to produce all results
• Solution effectiveness: Indicators of specific capabilities to produce high quality results, or ineffectiveness that leads to result defects or low quality
• Solution uncertainty: Indicators of reliability in producing results or problems or uncertainty of solutions to produce results
• Solution incidents: Incidents of utilization for good or bad results and good result value creation
• Solution actual: Actual performance against performance expectations
• Capital worth: Assessment of the development costs and value-quality results expected over a time period or remaining life, independent of other measures like unamortized balance

R-pM records comprehensive business data and reports the information needed for management to make current and strategic business decisions.

R-pM uses information systems to manage only six information sets

R-pM is designed to utilize modern information technology to organize the business for 21^st century management. R-pM uses only the information that defines business activity in six precisely-defined sets and subsidiary entities:

1. Results: Outputs of value to produce income organized into result structures and value-quality chains
2. Performance: Specific qualified performance solutions deployed to a domain to incur costs and produce specific results
3. Capital: The set of performance solutions of positive (asset) or negative (liability) capital worth
4. Enterprises: The business enterprise with superior and subordinate units, plus suppliers, customers, business partners, solution providers, and others that interact with the business
5. Business Descriptors: The attributes of results, capital, enterprises, and the overall business to relate information to the business for industry, product group, market, customer segment, etc
6. Time Periods: Specific historic and planned future periods with result goals and performance expectations to create strategic value or develop new performance solutions and results

Subsidiary records detail results, such as material and products, and solutions, such as assets and employees. Performance transactions record details against the result, performance solution and performance domain. Business descriptor entities such as region, location, vendor support, contracts, intellectual property, etc. are attributes of results and solutions and may define additional support information and subsidiary records. Reporting only standard business entities enables comparison and collaboration across businesses.

Business results and performance solutions form the basis for business record-keeping. Business results, performance, capital, enterprises, descriptors, and time periods can be managed by existing financial and statistical accounting, relational database management, or information management and reporting systems to deliver timely information solutions. Existing information systems are utilized as process solutions to produce specific results and generate business transactions. Other results may be recorded directly. R-pM can record comprehensive details or summary levels, as needed, on the business, and provides extensive information solutions to produce and manage business results. Even so, the work involved, computer resources required, and data and information maintained by R-pM is only a small fraction of that required by typical 20^th century management structures.

Data is recorded in the business information base that is used to manage the business

The objective of 21^st century management is to organize and manage the business of the corporation. R-pM directly organizes and manages the business to record actual business data, to update one complete and accurate set of data in the business information base, and to deliver business management information solutions on result value-quality chains, result value-added, actual return on investments, capital and corporate worth, etc that cannot be provided today. R-pM provides the solutions, so that 21^st century management can concentrate on managing the business.

Visit Result-performance-Management.com to learn more about organizing your business with R-pM for 21^st Century Management, and to obtain the R-pM Toolkit, your 21^st Century Management Manual.