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

20^th century enterprise management lays organization and management structures over the business

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

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

Performance that mixes capital solutions utilized and results produced is employed in all management structures such as Key Performance Indicators and performance management dashboards and scorecards. This prevents the business from being organized and managed. Capital investments are not identified and managed as specific solutions in the set of capital implemented in the business. Business results produced are not identified and managed as specific results in the set of economic outputs from the business. Business performance is not identified and managed as specific solutions utilized to produce specific results in the set of business performance.

Every corporation, association, 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 and change management problems. Since the business is not organized, the business cannot be managed. The enterprise must be managed through management structures laid over the business, such as strategic maps, business processes, administrative functions, charts of accounts, activities for costing, quality measures, position and grade tables, etc.

These two characteristics cause fundamental 20^th century enterprise organization and management problems that can never be solved by continuing to lay new or improved structures over the business.

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

21^st century business management starts over again to directly organize and manage the business of any enterprise as one integrated business structure for all organization and management. 21^st century management directly manages three entities to manage the business:

• Results: Specific economic outputs that must be produced by business performance
• Capital Solutions: Specific capital investments that must be utilized in performance to produce results
• Performance Domains: The utilization of a capital solution to incur costs to create value in the result produced

Results are the inputs to and the outputs from performance. A result is a specific accomplishment, like customer order booked, that can be counted and measured. Capital  solutions are specific items of capital, like the order booked business process, a human salesmanship capability, facility cash and supplies, and competitive management tactics solutions utilized to produce the result. The business structure is like a spreadsheet, with results across the columns and capital solutions down the rows. The business is organized when capital solutions are implemented as performance domains in specific cells to produce results. The business structure is updated with each result or solution change, and records business transactions and data for each performance domain and result and capital solution total.

The one business structure is used for all business organization, planning, direction, control, reporting, and governance.  Structures laid over the business are cleared away along with unsolvable 20^th century management problems.

21^st century business management captures actual business data

21^st century business management manages the real business and eliminate 20^th century organization and management problems. Actual business data is captured to report 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 (asset) or negative (liability) capital worth captured or assessed as solutions deteriorate or become outdated to record the worth of all capital, and to manage real enterprise and business 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.

Business management 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 21^st century business.

21^st century business management manages in three dimensions

21^st century business 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.

Management in these three dimensions requires some fundamental changes.

• Everyone in the enterprise business 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 capital solutions utilized across the business. Professional capital management replaces administration to develop, operate, and support solutions, with performance management to provide qualified solutions in performance domains to produce specific results. Capital solutions are organized for business comparison, collaboration, and integration
• Strategic result value is planned and continuously managed. The strategic business structure organizes results and the capital solutions needed, at a strategic horizon. Strategic value creation and new result and capital solution development are planned, estimated, and managed by time period to identify variations from the strategy

21^st century business management provides the management of result value for investment returns and capital worth, management of performance costs to produce value-added contributions to profits, management of performance to ensure that solutions are utilized properly to control costs, and management of the business by time period to bring the current business structure to the strategic business structure creating strategic value.

Result-performance Management (R-pM) provides the knowledge and procedures for actual business management and reporting

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. Business management knowledge and the Business Management Toolkit are available and supported today 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.