The Commonalities of all Businesses Build the Foundation for Business Management

Enterprises organize with different legal forms, structures, and ways of doing business

We have defined many different kinds of enterprises in companies, business, corporations, institutions, government agencies, etc. We have defined many different industries. We have defined different legal forms; public, private, partnership, etc. We contrive many different structures that can be used to manage the enterprise, such as organization theories, business processes, various information systems, administration functions, account charts, cost structures, quality structures, performance management scorecards and control panels, and so on. Then we combine these structures in different ways to produce different ways of doing business for each of the different kinds of enterprises.

All of the things we define make our basic enterprises different and separate. We usually think that is good to be different and demand industry-specific or custom solutions to show that we are different. But being different is not the same as competitive differentiation. Competitive differentiation takes advantages of opportunities to add customer, partner, or public value. Being different just adds costs, and hampers collaboration and prevents common solutions. So, we should define the commonalities of all enterprises businesses and build on the commonalities, rather than the differences.

Organizing the enterprise and not the enterprise business creates many unsolvable problems

A big part of the problem is that we organize and manage the enterprise. But no enterprise organizes or manages the actual business. There are many ways to define, organize, and manage an enterprise and many ways an enterprise may “do business”. Organizing the enterprise rather than the business causes many unsolvable organization and management problems, like reorganizations, alignment, unknown costs and value, unknown capital worth and returns, intangible assets, business collaboration, and on and on.

21^st century business management organizes and manages the commonalities of all businesses

There is only one way to define, organize, and manage the actual business of the enterprise. There is only one way of doing real actual business. The way is 21^st century business management. Result-performance-Management (R-pM), provides the breakthrough knowledge and procedures to organize the business of any enterprise of any kind in any industry for 21^st century business management.

21^st century business management builds on the commonalities of all businesses. Every business must:

• Have an objective or reason for existence
• Produce output results in order to achieve the objective
• Perform in order to produce results
• Utilize capital in performance
• Utilize common kinds of capital to perform
• Utilize specific capital solutions to produce specific results
• Utilize or consume capital in performance to incur costs
• Create value through performance in results produced
• Create result value greater than performance costs to survive
• Change and improve in order to grow
• Deteriorate naturally, if there is no change and improvement
• Invest in additional capital to improve performance
• Acquire or develop capital as solutions of worth
• Utilize invested capital to increase the value of results
• Increase the value of results in order to gain the return on investments
• Create more value in results than the cost of capital in performance for shareholder value
• Have capital solution worth in the attributed result value-added over the remaining useful life
• Have business worth in the average annual result value-added over a payback period at a desired investment return

These points are common to all types of business in any enterprise structure, in any industry, and in any type of legal entity.

Business management builds on the commonalities of all businesses

The fundamental principles of business management correspond to these commonalities, so that any enterprise can employ 21^st century business management.

These business commonalities and corresponding business management principles produce an innovative breakthrough to utilize performance to produce valuable results in operations and to use result requirements to produce justified capital solutions needed for performance improvements in development

21^st century business management defines the enterprise business as “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. This definition is implemented in a business structure. The business structure is a matrix like a spreadsheet with results across columns, capital solutions down rows, and performance in each cell, where a specific solution is deployed to produce a specific result. Results include product, order, service or project or assignment completed, or other output that can be counted. Capital includes all tangible and intangible assets organized as specific solutions in business, human, facility, and management capital. Once the business is organized the commonalities of the business are defined and can be managed directly.

All businesses are organized through one consistent business structure

The business is organized and managed using one structure for the current business and another structure for the strategic business to organize strategic results and capital development required to provide solutions needed. Result goals show strategic value creation by period from the current to strategic business. The current and strategic business structures are used for all business organization and management to replace organization and management structures laid over the business today.

Business management does not organize people or business organization units. Business management organizes the results that the enterprise must produce to create value and the capital solutions that must be utilized to produce the results. People are human capital and are deployed as personnel solutions to be ready to produce results and as developed capability solutions to produce specific results. Business result units are business organization solutions deployed to produce a set of specific results.

The enterprise business is structured by the results that it must produce and the relationship between results for results that contribute to a bigger result, results that are part of a chain leading to a final results, results that add costs or value to another, etc. By structuring results, capital solutions, and performance in the utilization of solutions to produce results, 21^st century business management organizes the business of any and all enterprises.

Businesses standardize for cost-effective performance and differentiate only where needed for value-quality results

The enterprise benefits by standardizing where possible for cost-effective performance solution utilization. Capital solution utilization in performance is on the cost side and must be controlled, to produce profit margins.

The enterprise produces three categories of results on the value side:

• Capital results manage and support capital solutions and the provision of qualified solutions to be utilized in performance. The enterprise benefits by standardizing these results and the performance supported.
• Revenue results generate revenues and achieve objectives. The enterprise benefits by differentiating revenue results appreciated by customers to increase value and reduce costs as input results or capital solutions utilized in the customer business structure and result value-quality chains.
• Investment results manage capital development, value creation, and change over time. The enterprise benefits by standardizing these results, and by planning and managing projects subsidiary to investment results as businesses with a project business structure.

The only place the enterprise differentiates is in the value created in specific results appreciated by the customer, partners, or public. The differentiation is not in the business structure, but only in the value and quality of result design and the cost-effectiveness of capital utilized in performance to produce the value-quality of the result.

Therefore, all enterprises should emphasize their commonalities to reduce costs, collaborate effectively, and share solutions and emphasize differentiation only in the design and value and quality of specific results produced.

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 20^th 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 21^st century management conventions, definitions, and standards. Management consultants who base 21^st 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 20^th 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 20^th 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.