What is the Difference Between 20^th and 21^st Century Management?

20^th century management manages the enterprise by laying organization and management structures over the business

We are all familiar with 20^th century management used today. Two important characteristics define 20^th century management:

• The definition of performance as not only business capital solutions utilized in business activity, but also business results produced as economic outputs
• The organization structure that organizes the enterprise, rather than the business, requiring that the enterprise be managed through management structures

Performance that mixes business solutions and results is employed in all management structures such as Key Performance Indicators and performance management dashboards and scorecards; and prevents the business, “the activity of providing goods and services”, from being organized and managed.

Every business, corporation, or institution has an enterprise organization structure that describes units, positions, reporting, etc. The organization structure is laid over the business, leading to later reorganization. Since the business is not organized, the enterprise must be managed through management structures laid over the business, such as business processes, information systems, charts of accounts, etc.

These two characteristics cause fundamental 20^th century organization and management problems that can never be solved by improving or adding overlaid structures. The Top 10 Problems with 20^th Century Management were summarized in an earlier article.

21^st century management manages the enterprise business as one integrated business structure

21^st century management starts over again to directly organize and manage the business of any enterprise as one integrated business structure for all organization and management. The definition of 21st century business is “the utilization of capital in performance to produce value in results”. 21^st century management directly manages two entities to manage the business:

• Results: Specific economic outputs that must be produced by business performance
• Performance Solutions: Specific capital that must be utilized in performance to produce results

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 utilized through performance solutions to produce results. A performance solution is an item of capital, like a human salesmanship capability solution, utilized to produce the result. The business structure is like a spreadsheet, with results across the columns and performance solutions down the rows, that is updated with each result or solution change, and records business transactions and data for each cell and result and performance solution total.

There are ten fundamental rules for 21^st century management

An earlier article listed the “Ten Rules for 21^st Century Management” to be competitive in the 21^st century.

The 10 rules for 21^st century management require some fundamental changes.

• Everyone in the enterprise produces planned and managed results. Enterprise-wide results are organized and deactivated continually, so all human capital performs to produce specific results
• Capital is managed as standardized performance solutions. Professional capital management replaces administration to develop, operate, and support solutions, with performance management to provide qualified solutions to produce specific results. Performance solutions are organized by solution type for business comparison, collaboration, and integration
• Strategic result value is planned and continuously managed. The strategic business structure organizes results and the performance solutions needed, at a strategic horizon. Strategic value creation and new result and performance solution development are planned, estimated, and managed by time period from the status in the current business structure

21^st century management has three dimensions; the result dimension for each result produced, the performance dimension to support capital and provide solutions to produce specific results, and the management dimension to manage operations and development over time to create strategic value.

Result-performance Management (R-pM) is the conventional method used for 21st century management

Result-performance Management (R-pM) provides conventional 21^st century business organization and management to manage the real business and eliminate 20th century organization and management problems. R-pM records the actual data that describes the business for business management:

• Result value: To evaluate results from what the enterprise pays for input results, what internal customers agree, to what the external customer pays for final results
• Performance costs: Development and operation costs captured for all tangible and intangible capital that is utilized to produce results
• Result value-added: Redeploy solutions and deactivate low-value results, reduce performance costs, or adjust result value with another result, as needed, to manage positive value-added
• Capital worth: Positive or negative capital worth captured or assessed for revenue, performance, or investment capital to record the worth of all capital, and to manage real enterprise worth

This valuable business data is not recorded in the many 20^th century accounting and other structures that do not identify all capital of worth, performance solutions that incur costs, results that create value.

R-pM manages performance capacity used for result volume, performance costs against result value, performance effectiveness for result quality, performance uncertainty to reduce result risk, and performance expectations to reach result goals to optimize the business of the 21^st century enterprise.

Your 21st Century Management Manual is in the R-pM Toolkit

The R-pM Toolkit is the only source for learning, procedures, examples, and updates to implement and utilize R-pM for 21^st century management. The R-pM Toolkit is under continuing development to expand and refine 21^st century management. The R-pM Toolkit provides the glossary, definitions, and guidance to enable 21^st century business comparison, collaboration, and integration.

Join the R-pM Community at Result-performance-Management.com for no cost or obligation to download your 21^st Century Management Manual.