Page |1
Handout 5
Entrepreneurial Habits
- mental habits set entrepreneurs apart from non-
entrepreneurs.
Habits of entrepreneurs:
 Curious being
- open and curious about everything.
- curiosity keeps them asking questions and generating
ideas for their next moves.
 Turn obstacles into assets
- entrepreneurs believe and act as if everything is a gift.
 Having a high tolerance for ambiguity
- clear set of rules and expectations.
 Using fears and anxieties as fuel
- the anxiety must be reframed as excitement.
 Focus on the causes, not effects, of confidence and
success
- success represents more incredible adversity than
failure.
 Be proactive
- merely taking the initiative.
- as human beings, people are responsible for their lives.
 Put first things first
- Two (2) factors define an activity: urgent and important.
1. Urgent
- requires immediate attention.
- usually visible; they insist on action.
2. Importance
- results.
- contributes to an entrepreneur’s mission,
values, and high-priority goals.
 Think win-win
- frame of mind and heart that constantly seeks mutual
benefit in all human interactions.
- agreements or solutions are mutually beneficial and
satisfying.
 Seek first to understand, then to be understood
- profound paradigm shift.
- seek first to be understood.
 Synergize
- relationship of departments within an organization is
catalytic, empowering, unifying, and exciting.
 Sharpen the saw
- balanced program in four (4) areas of life (physical,
social/emotional, mental, and spiritual).
HANDOUT 6
Naert’s Model
- Philippe Naert, dean of the Antwerp Management School in
Belgium
- value creation is the purpose of business.
- economic and societal values can be pursued at the same
time.
Van Duzer’s Model
- Jeff Van Duzer, dean of the School of Business and Economics
at Seattle Pacific University.
Purpose of business is two (2)-fold:
 To serve customers by providing goods and services
that promote human flourishing
- customers and the broader community.
 To serve employees by providing opportunities for
meaningful and creative work
- tends to focus on employees and vendors.
- profit should be best viewed as a means to serve customers
and employees.
- pursuit of profit is necessary for business but is not the
purpose of business.
“The purpose of a business, in other words, is not to make a
profit, full stop. It is to make a profit so that the business can
do something more or better.” – Jeff Van Duzer
Parikh’s Model
- Indira Parikh, president of the Foundation for Liberal and
Management Education (FLAME)
- ancient wisdom of Hindu scriptures can be appropriated to
business practices.
 Bhagavad Gita
- thoughts and actions rather than the outcomes of
those actions.
1. Greed is bad
- never engage in action only for the desire of
rewards.
2. Be fair
- leaders are compassionate and selfless.
- “They treat everyone as equals.”
3. Act rather than react
- leader’s actions today can become the “karma”
that influences their status tomorrow.
- “excellence by taking action.”
4. Seek higher consciousness
- view problems within their larger contexts.
 Dharma
- Dr. Athreya, renowned management guru.
- core concepts of Dharma (natural law), as enshrined in
the Indian Shastras (timeless principles).
- righteous duty or the right path to uphold the family
and the organizational and social fabric.
Main principles of Dharma:
1. Loka Sangraha (Public Good)
- seeking one’s gains and catering to the welfare
of others.
2. Kausalam (Efficacy)
- use of resources for future generations.
 Page |2

3. Vividhta (Innovation) of investment involved.

- engine of innovation, constantly seeking more Income Statement
effective solutions to meet its economic and social - summarizes the revenues earned and expenses incurred by a
business over an accounting period.
expectations. - profit-and-loss (P&L) statement.
4. Jigyasa (Learning)
- change and continuity coexist. Income statement may help in providing information on:
 Wealth generation
Business Model - wealth has been created is vital for businesses.
- firm’s business plan, income statements, and cash flow  Profit derivative
- information needed to gauge business performance.
projections.
Cash Flow Statement
- conceptual, rather than a financial, framework. - focuses on liquidity.
- describes how a company creates and captures value. - cash flows are the inflows and outflows of cash into and
out of business.
Primary considerations in developing a business model: - net cash flows are the difference between inflows and
1. A more personalized product or service outflows.
- tailored to customers’ individual and immediate needs.
2. A closed-loop process Financial Ratios
- closed loop, in which used products are recycled. The following are the common types of ratios:
3. Asset sharing
- innovations succeed because they enable sharing of Return on Investments (ROI)
costly assets. - return on the owner's equity; hence it is sometimes referred
4. Usage-based pricing to as return on equity (ROE).
- charge customers when they use the product or service FORMULA:
rather than requiring them to buy something outright. Return on Investments = ___Income After Income Tax___
5. A more collaborative ecosystem Average Stockholder’s Equity
- new technology improves the relationship with supply Profit Margin/Return on Sales (ROS)
chain partners - the income to net sales ratio.
6. An agile and adaptive organization
FORMULA:
- make decisions that better reflect market needs and
Profit Margin = ___Income___
allow real-time adaptation to those needs.
Net Sales
Handout 7 Return on Assets (ROA)
Types of Financial Statement: - effectively the company has utilized its assets.
Balance Sheet/Statement of Financial Position FORMULA:
Return on Assets = _____Income_____
- financial position of a business on a certain date (usually the
end of the month or year). Average Total Asset
- presents a business view of assets equal to the sum of Current Ratio
liabilities and capital.
- relates current assets to current liabilities and shows a firm's
Primary functions of a balance sheet: immediate solvency and liquidity.
 Business funds Solvency
- meet long-term obligations.
- capital contribution of owners and outside lenders.
Liquidity
- acquired assets of the business.
- enterprise's ability to pay short-term bills and debts.
 Business value FORMULA:
- firm's value since it lists all the assets and business Current Ratio = __Current Asset’s__
claims.
Current liabilities
 Business assets and claims Quick Ratio (Acid-Test Ratio)
- relationships between various statements of financial - company's short-term liquidity and measures.
position items. FORMULA:
 Business performance Quick Ratio = ____Quick Asset____
- generating wealth can be assessed against the amount Current liabilities
 Page |3

- drives companies to focus simultaneously on eliminating,

Debt Ratio reducing, raising, and creating while unlocking a new blue
- compares a company's total debt to its total assets. ocean.
FORMULA:
Debt Ratio = ___Total Liabilities___
Total Asset
Stockholder's Ratio
- measures how much of a company's assets are funded by
issuing stock rather than borrowing money.
FORMULA:
Stockholder's Ratio = __Total Stockholder’s Equity__
Total Asset
Debt-Equity Ratio
- percentage of the company's balance sheet.
FORMULA:
Debt-Equity Ratio = ______ Total Liabilities______
Total Stockholder’s Equity
Interest Coverage Ratio
- company's ability to meet its interest payment obligations.
FORMULA:
Interest Coverage Ratio = __Operating Income__
Interest Expense

Handout 8
Blue Ocean Strategy
- creates a new market space and stimulates new demand.
- can create brand equity that lasts for decades.
- rejects the fundamental principle of conventional strategy.
Red Ocean Strategy
- competing in an existing market space to capture demand.
Red Ocean Strategy
Compete in existing market space
Beat the competition
Exploit existing demand
Make the value/cost tradeoff
Align the company’s activities with its strategic choice of
differentiation or low cost
Blue Ocean Strategy
Create uncontested market space
Make the competition irrelevant
Create and capture new demand
Break the value/cost tradeoff
Align the whole system of a company’s activities in pursuit of
differentiation and low cost
Strategy Canvas
- graphically depicts a company’s and its competitor’s value
proposition.
“Four (4) Actions Framework”
- tool in crafting a future strategy canvas.
Eliminate-Reduce-Raise-Create (ERRC)
- developed by W. Chan Kim and Renee Mauborgne