The conventional 20th century enterprise faces many unsolvable performance problems, because invested capital solutions utilized, performance in the utilization of solutions, and results produced are mixed together as performance and are not specifically defined and managed. Performance problems arise because performance is defined to include the utilization of capital in actions executed and the output result accomplished. The definition of performance is the main cause of performance problems.

Result-performance Management separates results from performance for 21st century management

The problems can only be eliminated by separately organizing and managing capital utilized in performance, performance in the utilization of capital to produce results, and output results produced from performance through Result-performance Management (R-pM). R-pM organizes, plans, operates, develops, and reports results, capital, and performance as separate components of the business. Result-performance Management provides one integrated business structure to organize and manage the business for the 21st century and leave unsolvable 20th century performance problems behind.

The 20th century enterprise has always faced unsolvable problems

Since capital utilized, actions executed, and results accomplished are mixed together as performance, all problems in capital utilized, actions executed, and results accomplished are called performance problems. We all have experience with unsolvable performance problems that the 20th enterprise has to work around today:

• Periodic reorganization and upheavals, because the business is not organized

• Faulty investment analysis because benefits cannot be itemized

• Unbeneficial capital development, because unknown benefits are not managed to gain the return

• Unmanaged capital, intangible assets, unknown costs, unknown value, distorted capital worth

• Performance management methods that do not manage performance, because performance is not properly defined

• Contrived value management because the creation of value is not understood and managed

• Misleading cost management because many performance costs are not known and costs are charged to the wrong entities

• Inaccurate and incomplete financial recording because recording is dictated by principles and does not record the actual business

• Corporate governance based on distorted financial reports and arbitrary compliance rather than accurate management of strategic value

• Alignment problems aligning strategies, processes, systems, outsourcing, technology, etc with the business because the business is not defined

• Quality focused on final products because of hard-to-define performance quality along a process

• Barriers to collaboration due to lack of means to determine shared costs and values

• Re-engineered business processes that hamper capital, quality, and cost management and prevent creation of value chains

• Business complexity due to various overlaid structures that do not fit together as one whole and obscure the view of the business

• Auditing to ensure that rules are followed, and no one looking at how capital is utilized to produce results and reach objectives

• Insufficient information because information abounds, but does not directly describe the business and is not managed as capital to provide benefit

• Unmanaged capital because high-worth information, intellectual, and management capital is labeled as intangible rather than being managed to understand its worth as part of enterprise worth and its performance costs as part of enterprise costs

These are just some common performance problems arising from combining capital and results in with performance.

20th century problems, caused by conflicts between structures and the business, can never be solved by more overlaid structures

These unsolvable performance problems arise because the enterprise today organizes people, positions, units, functions and other contrived entities rather than the business. The organization structure is laid over the business. The business must adjust to the organization, which restricts business flexibility and hampers business change. The enterprise is managed by additional structures laid over the organization for strategic planning, processes, accounting, administrative functions, costing, performance reporting, etc. Each structure defines its own contrived entities: such as center, activity, task, object, account, process, rank, etc. that do not describe the business.

Management books and solutions try to solve unsolvable performance problems by laying new contrived structures, over the existing structures, such as data reconciliation, enterprise information management, performance management scorecards, IT architectures, etc. The performance problems continue, because they can never be solved by adding new structures or improving existing structures.

Results must be organized and managed separate from performance

The biggest barrier to managing the business has been the 20th century definition of "performance" that defines results to be the same as performance, and does not distinguish capital utilized. Even today new methods for performance management, key performance indicators, business processes, etc. employ this definition, and mix results and performance together.

20th century problems must be eliminated by organizing managing the 21st century business

The only way forward is to eliminate all obsolete 20th century structures by defining, organizing, and managing the enterprise business.

Due to the definition of performance, enterprises today do not organize and manage the only three components that actually comprise the business.

• Result: Specific economic outputs produced by performance across the totality of the business

• Capital: Investments defined as specific solutions that are utilized in performance

• Performance: The utilization of a specific solution to produce a specific result

Results must be organized as a complete set to manage the value and quality of each result produced along a result chain and across the business. Capital must be organized as a complete set to be supported properly and to be integrated and utilized in performance. Performance must be organized as a set to manage the cost and effectiveness of each solution utilized to produce each result to organize and manage the complete business.

Result-performance management is a breakthrough to manage the 21st century business in three dimensions

Any enterprise today can organize the business for 21st century management and to leave 20th century performance problems behind, through a new breakthrough Result-performance Management (R-pM). As shown at www.result-performance-management.com, R-pM defines, organizes, and manages the enterprise solely in terms of results, capital, and performance.

R-pM also defines the periods of time utilized for strategic, operational, and development planning, enterprises that interact with the business, and precise business descriptors for the attributes of results, capital and enterprises. R-pM then manages the enterprise in three dimensions.

• Result: To manage each economic output produced to contribute to revenue goals

• Performance: To manage each performance solution utilized to contribute to profit margin goals

• Management: To manage period by period to develop, reach return goals, and create strategic value

This completely defines the enterprise business. The business structure is the only structure needed for all business management. R-pM clears away contrived structures for transparent and systematic 21st century management.

R-pM measure and manages the attributes of results separate from performance

The enterprise creates value through results. Quality is an attribute of the result, not of the performance. Value must be added to results to justify improvement or development. Risk is the chance that a result will not be produced completely or on-time, as planned.

Costs are incurred through performance. The performance cost can only be charged against the value created in the result. Performance effectiveness puts quality into results. Performance capacity in each solution utilized is needed to produce a volume of results. Performance improvement or development can produce benefit only by adding value to results. Performance uncertainty causes much of result risk.

If the enterprise does not manage capital, results, and performance, it cannot manage costs, value, benefits, worth, volumes, quality, risk, uncertainty, and other attributes of capital, results, and performance that are not precisely managed in the 20th management.

The challenge all 20th century corporations face is to organize and manage their business to compete in the 21st century

So, again, challenge for an enterprise is to move from managing the enterprise through structures laid over the business to managing the business itself as on organization and management structure. Each enterprise must organize and manage its own business in terms of the results produced, the tangible and intangible capital invested in as specific solutions, and the utilization of solutions in performance to produce specific results. This produces one business structure to organize and manage the complete current and strategic business. No other structures are laid over the business. Once the enterprise has defined its own business, it is easy to implement and utilize R-pM for 21st century management, to leave 20th century performance problems behind.