Innovation and Entrepreneurship
Introduction (Infoxchange Australia – Recommended Now)
Infoxchange Australia is one of the companies that utilize the digital technology to encourage
and promote social justice. Its major objective is to ensure that communities wishing to access
the new digital technology and enjoy its benefits are able to, without much difficulty or they are
not faced with any form of inability i.e. lack of income or location. Infoxchange aims at
providing efficient service delivery by coordinating shared information systems. After receiving
several grants from the government to lift off from the ground, Infoxchange developed a number
of products whose aim was to improve the immediate technological needs of the people living
near its operations and business activities. (Kernot and McNeil, 2011) Infoxchange came up with
innovations and business activities that besides providing essential and critical services they also
provided business opportunities for sustainable economic growth. For instance, in the year 2006,
Management 2
Infoxchange developed six core activities and business opportunities around its trading activities
i.e. these were, the service seeker, the Green Pc, Web design, advanced training in digital
technology, interstate and ISP customer help desk. http://www.infoxchange.net.au/
Financially, Infoxchange has performed very well given its aim of also providing services to the
community. In the year 2012, as the audited statements, its revenues grew by 35% from the year
- Non-current assets grew by 37% for the similar period. Short term borrowings reduced by
3% from the year 2011 while long term borrowings reduced by 22%. Net assets also increased
by 14% during the same period. Total equity also increased by 14% in the year 2012 from the
year 2011. Infoxchange annual reports for the year 2012
The short term ratios of liquidity reveal that infoxchange has the ability to take care of its short
term liabilities and obligations. ( Drucker, 1999) The current Ratio of infoxchange is 2:1 which
is the ideal standard for assets verses the liabilities i.e. the assets should be twice the number of
liabilities which makes it easier to pay off any liabilities in case there is such a need in future.
The quick ratio is still the same as the closing stock is negligible compared to the total assets.
The leverage ratios are pretty low that is as the infoxchange debt to equity or debt to asset ratio is
almost neglible compared to the total equity or assets. This is a very good financial position as it
shows the company is not overburdened by debts. However a company that does not utilize debts
may not be exploiting all its chances for growth and investment opportunities but whatever the
case the debt should never exceed 50% of its capital. The ROI of infoxchange is also favorable
but its SROI is far above average. (Millar & Hall, 2012) The nature of its social activities is
Management 3
impressive and its impact on the social scene is phenomenal. Infoxchange in my view is the best
among the three and I would recommend highly to the government for future funding in case of
an expansion strategy.
Work venture has its origins in a community church in La Perouse in Sydney, Australia in the
year 1979. The initial activities included the children vacation home, post office agency and a
clothes recycling business. In the year 1984, Peninsula Community Services were also
incorporated so as to provide training services in computer operations through Compuskill, a
computer training center. During this period there was a very high unemployment rate in the
country and the central government was trying to look for a way to promote employment in the
country by funding such enterprises to create employment. Work Ventures core philosophy was
to create a social enterprise that would train people on computer use, utilize business
opportunities found locally and in the process also create employment to marginalized people.
The business structure was modeled to replicate the ITeC (Information Technology Center)
center in UK. Three ITeC pilot projects were approved for funding by the government and were
located in Sydney, the city of Melborne and in central Perth. SIRC (Sydney ITeC Repair Center)
was established to work in partnership with IBM in building the required capacity to run and
manage the outsourcing business. (Kernot and McNeil, 2011) Work Ventures won a contract
with NCR to outsource its services and products and later when it closed down its operations, its
national center for repairs officially contracted the major work to SIRC. Most of NCR equipment
was leased to SIRC at favorable payment conditions and terms. SIRC expanded further to
Automated Teller Machines, Distribution Systems and electronic scanning. (Arvidson et al,
2010) The SIRC main purpose was to help in reduction of unemployment levels in the
community. When the profits are affected by the level of staff, work ventures prefers to retain the
Management 4
employees and utilize other resources to achieve its targets. Considering all these factors the
Return On Investments (ROI) for Work Ventures is probably below average. But the SROI
(Social return on investment) which measures other issues like the environmental factors and
social undertakings besides the financial performance. SROI has its logic on the cost benefit
analysis which is rooted in social sciences that’s normally used by the promoters or funders of
the project who are outside the organization to make judgment or determine if their investment
or the grant given is being used efficiently. Given these values of SROI of involving the
stakeholders and understanding the social changes surrounding the environment, being
transparent and verifying the results, Work Ventures performance is above average. Financially,
the performance of Work Ventures in its trading activities was not so impressive in the year
- The revenues dropped by 12.9% in the year 2012 from the year 2011. The total deficit in
the year 2012 from its trading activities was 500,367 from the previous deficit of 518,449. The
total equity at the end of the financial period dropped by 13% in 2012 from the year 2011. The
total assets in the year 2012 decreased by 13.6% from the year 2011. Total liabilities decreased
by 14% in 2012 from the year 2011. Generally most of the liabilities of the year 2011 were paid
in the year 2012. (Vance, 2003) These resulted in the deficits experienced in 2012. Future
Employment Opportunities (ERS) annual reports for the year 2012. Given the nature of Work
Ventures business model, its wide connections with the central government in its award of the
NCR contract, its general funding to increase its production and its management expertise, it’s
very hard to reconcile its unending under performance in revenue collection and its deficit or
negative returns. It’s very difficult to recommend it for more funding. I certainly reject its
recommendation for further funding.
Management 5
Work venture has its origins in a community church in La Perouse in Sydney, Australia in the
year 1979. The initial activities included the children vacation home, post office agency and a
clothes recycling business. In the year 1984, Peninsula Community Services were also
incorporated so as to provide training services in computer operations through Compuskill, a
computer training center. During this period there was a very high unemployment rate in the
country and the central government was trying to look for a way to promote employment in the
country by funding such enterprises to create employment. Work Ventures core philosophy was
to create a social enterprise that would train people on computer use, utilize business
opportunities found locally and in the process also create employment to marginalized people.
The business structure was modeled to replicate the ITeC (Information Technology Center)
center in UK. Three ITeC pilot projects were approved for funding by the government and were
located in Sydney, the city of Melborne and in central Perth. SIRC (Sydney ITeC Repair Center)
was established to work in partnership with IBM in building the required capacity to run and
manage the outsourcing business. Work Ventures won a contract with NCR to outsource its
services and products and later when it closed down its operations, its national center for repairs
officially contracted the major work to SIRC. Most of NCR equipment was leased to SIRC at
favorable payment conditions and terms. SIRC expanded further to Automated Teller Machines,
Distribution Systems and electronic scanning. The SIRC main purpose was to help in reduction
of unemployment levels in the community. When the profits are affected by the level of staff,
work ventures prefers to retain the employees and utilize other resources to achieve its targets.
Considering all these factors the Return On Investments (ROI) for Work Ventures is probably
below average. But the SROI (Social return on investment) which measures other issues like the
environmental factors and social undertakings besides the financial performance. SROI has its
Management 6
logic on the cost benefit analysis which is rooted in social sciences that’s normally used by the
promoters or funders of the project who are outside the organization to make judgment or
determine if their investment or the grant given is being used efficiently. Given these values of
SROI of involving the stakeholders and understanding the social changes surrounding the
environment, being transparent and verifying the results, Work Ventures performance is above
average. Financially, the performance of Work Ventures in its trading activities was not so
impressive in the year 2012. The revenues dropped by 12.9% in the year 2012 from the year
- The total deficit in the year 2012 from its trading activities was 500,367 from the previous
deficit of 518,449. The total equity at the end of the financial period dropped by 13% in 2012
from the year 2011. The total assets in the year 2012 decreased by 13.6% from the year 2011.
Total liabilities decreased by 14% in 2012 from the year 2011. Generally most of the liabilities
of the year 2011 were paid in the year 2012. These resulted in the deficits experienced in 2012.
Given the nature of Work Ventures business model, its wide connections with the central
government in its award of the NCR contract, its general funding to increase its production and
its management expertise, it’s very hard to reconcile its unending under performance in revenue
collection and its deficit or negative returns. It’s very difficult to recommend it for more funding.
I certainly reject its recommendation for further funding in future.
Eagle Hawk Recycle Shop (ERS) Recommended but with changes.
Eagle Hawk Recycle Shop (ERS) was founded by Future Employment Opportunities Inc (FEO)
in the year 1994 to reduce unemployment rates through creation of employment, reduce landfill
and promoting re-use. Eagle hawk Recycle Shop is a business unit of Future Employment
Opportunities which is incorporated in the city of Victoria. (Kernot and McNeil, 2011) ERS has
Management 7
twenty-two employees and about ten volunteers. As a social enterprise, ERS breaks even and
currently does not depend on any funding as 100% of its income comes from its own trading
activities. Within the first one year of its existence it was able to finance its own budget. ERS
currently has several recycling sites in Bendigo with a turnover close to $900,000. ERS took
assessment on its Social Return on Investment (SROI) on its general operations by a consultant
on Social Ventures in Australia. The SROI ratio obtained showed a high ratio rating which is a
positive mark in its performance with the general public. http://www.feo.net.au/recycle-shop
Financially, the performance of ERS has been above average. The receipts from customers
increased by 54% in the year 2011 from the previous year i.e. 2010. (From the last available
audited financial records for the year ended 31 st Dec 2011) The profit for the year increased by
14%. In the year 2011 from the year 2010. The current assets decreased by 4% in the same year
from the previous year. Total liabilities decreased by 68% in 2011 from the year 2010. Net assets
also increased by 57% in the year 2011 from the year 2010. Equity also increased by 57% during
the same period. (Khan, 1993) Given the financial position of ERS the Return On Investment is
favorable and its SROI is also favorable. I would recommend it for further funding but with the
following key changes. The operating grants received from the government should be reduced
substantially and the ones received from the private sector should be limited to essential ones
only. This is to assist the enterprise to be self reliant and also for it to streamline its operations
and also to maintain its profitability besides the social services it’s providing in the society. ERS
has enormous opportunity in industrial recycling and it should replicate it in other cities as well
so as to expand its financial base. These will also develop its scrap metal business unit to also
expand its business. ERS should not only encourage its social programs but also strengthen its
Management 8
income generating activities to cope up with its social activities so as to retain its breakeven
capabilities.
Work venture – its recommendation is rejected.
Work venture has its origins in a community church in La Perouse in Sydney, Australia in the
year 1979. The initial activities included the children vacation home, post office agency and a
clothes recycling business. In the year 1984, Peninsula Community Services were also
incorporated so as to provide training services in computer operations through Compuskill, a
computer training center. During this period there was a very high unemployment rate in the
country and the central government was trying to look for a way to promote employment in the
country by funding such enterprises to create employment. Work Ventures core philosophy was
to create a social enterprise that would train people on computer use, utilize business
opportunities found locally and in the process also create employment to marginalized people.
The business structure was modeled to replicate the ITeC (Information Technology Center)
center in UK. Three ITeC pilot projects were approved for funding by the government and were
located in Sydney, the city of Melborne and in central Perth. SIRC (Sydney ITeC Repair Center)
was established to work in partnership with IBM in building the required capacity to run and
manage the outsourcing business. Work Ventures won a contract with NCR to outsource its
services and products and later when it closed down its operations, its national center for repairs
officially contracted the major work to SIRC. Most of NCR equipment was leased to SIRC at
favorable payment conditions and terms. SIRC expanded further to Automated Teller Machines,
Distribution Systems and electronic scanning. The SIRC main purpose was to help in reduction
of unemployment levels in the community. http://www.workventures.com.au/ When the profits
Management 9
are affected by the level of staff, work ventures prefers to retain the employees and utilize other
resources to achieve its targets. Considering all these factors the Return On Investments (ROI)
for Work Ventures is probably below average. But the SROI (Social return on investment) which
measures other issues like the environmental factors and social undertakings besides the financial
performance. SROI has its logic on the cost benefit analysis which is rooted in social sciences
that’s normally used by the promoters or funders of the project who are outside the organization
to make judgment or determine if their investment or the grant given is being used efficiently.
Given these values of SROI of involving the stakeholders and understanding the social changes
surrounding the environment, being transparent and verifying the results, Work Ventures
performance is above average. Financially, the performance of Work Ventures in its trading
activities was not so impressive in the year 2012. The revenues dropped by 12.9% in the year
2012 from the year 2011. (Kaplan, Robert and Bruns, 1987) The total deficit in the year 2012
from its trading activities was 500,367 from the previous deficit of 518,449. The total equity at
the end of the financial period dropped by 13% in 2012 from the year 2011. Work Ventures
annual reports for the year 2012. The total assets in the year 2012 decreased by 13.6% from the
year 2011. Total liabilities decreased by 14% in 2012 from the year 2011. Generally most of the
liabilities of the year 2011 were paid in the year 2012. These resulted in the deficits experienced
in 2012. (Garrison, Noreen and Brewer, 2009) Given the nature of Work Ventures business
model, its wide connections with the central government in its award of the NCR contract, its
general funding to increase its production and its management expertise, it’s very hard to
reconcile it’s unending under performance in revenue collection and its deficit or negative
returns. It’s very difficult to recommend it for more funding. I certainly reject its
recommendation for further funding.
Management 10
References
Drucker, F. (1999). Management. Challenges of the 21st Century. New York: Harper
Business,
Vance, D. (2003) Financial analysis and decision making: tools and techniques to solve
financial problems and make effective business decisions. New York: McGraw-Hill.
Khan, M. (1993) Theory & Problems in Financial Management. Boston: McGraw Hill
Higher Education.
Management 11
Garrison, H., Noreen, E., Brewer, P. (2009) Managerial Accounting . McGraw-Hill Irwin.
Kaplan, Robert S. and Bruns, W. (1987). Accounting and Management: A Field Study
Perspective Harvard Business School Press,
Millar & Hall (2012) Social Return on Investment (SROI) and Performance Measurement. In
Public Management
Arvidson et al (2010) The Ambitions and Challenges of SROI. TSRC.
Work Ventures annual reports for the year 2012.
Infoxchange annual reports for the year 2012
Future Employment Opportunities (ERS) annual reports for the year 2012.
Kernot, C. And McNeil, J. (2011) Australian Stories of social sciences. University of New South
Wales, Sydney.
