Faculty Of Business Environment Finance Essay - Free Essay Example

Sample details Pages: 8 Words: 2330 Downloads: 6 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Level High school Topics: Investment Essay Did you like this example? Hewlett is a general merchandise retailer based in Greece. This report will analyze the companys credit worthiness by reviewing its recent financial performance while considering the influence of the Greek economic climate in the same timeframe. According to the financial statements for the year ended 30 June 2012, both sales and gross profitability have grown steadily over the last three years, although less so between 2011 and 2012 as compared to the 2010/2011 figures. Don’t waste time! Our writers will create an original "Faculty Of Business Environment Finance Essay" essay for you Create order Sales revenue grew 18.9% from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬1.85B in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬2.2B in 2011 and then 13.6% to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬2.5B in 2012. Similarly gross profit grew 16.7% from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬600M to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬700M and then 7.1% to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬750M. These growth figures however, are put into perspective by the rising costs incurred in their sales process. Operating costs have risen 16.3% from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬550M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬640M in 2011 and then 9.3% to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬700M in 2012, causing operating profit (profit before interest and taxes-PBIT) to drop from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬60M in 2011 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬50M in 2012. Not surprisingly, a dividend of ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬20M has been proposed for 2012, down from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬30M the previous year. Again, to put this in perspective, consider that the company only has ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬20M in profit after tax and interest for 2012; just enough to pay the proposed dividend. The current market size for Greek store-based retailing stands at about ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬37B down from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬40B in 2011 and ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬47B in 2010 as shown in figure 1 below. With prosperity indexes being at record lows, it is no surprise that Greek retailing has suffered in recent years. The 5 biggest retailers in Greece by sales are AB Vassilopoulos, Sklavenitis, Lidl, Carrefour-Marinopoulos and Masoutis. While these 5 have maintained growth in total sales numbers over recent years, a look further down the list indicates companies with stagnant or reduced sales numbers from the Greek Wal-Mart, Jumbo, to Germanos and IKEA. With consumers becoming increasingly price conscious, retailers needing to keep the total sales level as high as p ossible have resorted to different tactics. In this regard, Hewlett has increased credit sales from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬300M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬400M in 2011 and then ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬600M in 2012. Figure 1: Total market size of Greek store-based retailing (Euromonitor 2012) Even with these measures, the strain of the recession on retailers has caused a streak of consolidations as a number of retailers have closed down stores. For example, Atlantic Supermarket closed its doors and a number of its former outlets were acquired by Masoutis, Lidl Hellas and AB Vassilopoulos. Similarly, outlets under the Dia brand are now Carrefour supermarkets. In a clear indication of the extent to which finances have been strained, since mid-2009, when the global economic slowdown began to bite, until mid-September last year, some 65,000 stores have been forced to shut their doors (The Guardian UK, 2012). Even with prices reduced by about 70% at the end of 2011, cash-strapped Greeks have reigned in their spending. This is not surprising considering the inflation growth percentage reaching 4.7% in 2010 and 3.3% in 2011 as shown in figure 2 below. Consumers suffering wage and pension cuts, rising inflation and a recession of a severity not seen since the Second World War ensured that shops had one of their worst Christmases on record, with retail sales down 30% on the previous year (The Guardian UK, 2012). Subsequently, a series of retailers have filed for bankruptcy in 2012 leaving more space for oligopolies to expand. Figure 2: Country file Greece (World Bank Databank 2012) Greek Banking Sector Since the sovereign debt crisis hit Greek banks in early 2010, Greek lenders have found themselves in a position where they do not have enough money to lend to businesses (Wall Street Journal, 2011). One of the reasons Greek banks are so cash strapped is the drop in bank deposits since 2010. The credit crunch and irregular practices have forced Greek banks to look towards consolidation to help control the liquidity crisis. RATIO ANALYSIS Profitability Ratio 2010 % change 2011 % change 2012 Gross Profit Margin (%) 32.4 -1.9 31.8 -5.7 30.0 Net Profit Margin (%) 5.1 +7.9 5.5 +1.8 5.6 Return on Capital Employed (%) 13.7 -2.9 13.3 +7.5 14.3 A proper credit analysis of Hewlett must consider its ability to remain viable as a business; profitability is a concern. The companys current return on capital employed (R.O.C.E) numbers indicate stagnation in this regard. It decreased from 13.7% in 2010, to 13.3% in 2011 and then increased to 14.3% in 2012. Stagnation in profits while interest payments rise gradually reduces the companys ability to make those payments (Attril Mclaney 2012, p. 336). The gross profit ratio enables further understanding of the success of the company at trading. Considering the industry involved (retail), a low profit margin percentage (averaging 31% over the past three years) is understandable as there is not a significant production process with raw materials and manufacturing costs that can be deducted from sales. In addition, retail firms tend to have much higher turnover ratios, much lower profitability on sales and much shorter operating cycles than p rimary manufacturing companies (Gombola Ketz 1983, p. 46). If the cost of sales is understood here as the cost of merchandise, then the low figures indicate the inability of Hewlett to control costs, perhaps due to inflation. In addition, as the costs of sales have increased from year to year, Hewlett appears to have failed in passing this on to the consumers resulting in wastage and a decreasing gross profit margin. Admittedly, it is difficult to increase prices in a retail sector that has witnessed a severe drop in sales. Nevertheless, it is important to note that in many stable businesses, retained profits represent the main source of income and even though they are not directly equivalent to cash, they are useful when interest rates are high (Jones 2006, p. 211). The stagnation in the net profit margin (5.5% in 2011, 5.6% in 2012) confirms that the company has not been successful in controlling overhead costs. This explains why the borrowing has increased from year to year; to cover expenses. A glance at the income statement reveals that the cost of sales increased by 20% in 2011 and 16.7% in 2012. The company might be making some profit, but that does not necessarily translate to cash-in-hand, available for spending. Liquidity Ratio 2010 % change 2011 % change 2012 Current Ratio 1.74:1 +21.8 2.12:1 -4.7% 2.02:1 Quick Ratio 0.97:1 +11.3 1.08:1 -4.6% 1.03:1 The current ratio, which gives an understanding of the liquid position of the company, has varied from 1.74:1 in 2010, to 2.12:1 in 2011 and then 2.02:1 in 2012. This is understandable considering an efficient retailer does not pile up stock but instead keeps stock at a manageable level with turnover as quick as possible. With the ratio trending above 2:1 in 2011 and 2012, the indication is that the company has sufficient current assets to turn into cash in order to meet its financial commitments. However, considering the fact that in a crisis, it is more difficult to turn stocks into cash compared to the other current assets, a more prudent measure of the ability of this company to pay its short term obligations is the quick ratio (Weetman 2010, p. 294). Similar to the current ratio, the quick ratio varied from 0.97:1 in 2010 to 1.08:1 in 2011 and then 1.03:1 in 2012. As shown by the increase in inventory from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡  ¬540M in 2011 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬620M in 2012, poor stock control has contributed to the weakened liquidity. In the embattled Greek economy, retail sales levels have dropped as disposable income has reduced. In a country where the annual disposable income has fallen from approximately US$240B in 2011 to US$223B in 2012, consumers do not have the money to maintain previous years sales numbers. In a worst case scenario where a retailer such as Hewlett is unable to turn stock to cash quickly enough, the ratio of 1.03:1 indicates that in the short run, Hewlett has the ability to pay off its current debt without selling its inventory. Efficiency Ratio 2010 % change 2011 % change 2012 Stock Turnover Rate (times) 3.13 +1.9 3.19 -5.3 3.02 Debtor Collection Period (days) 599 -16.3 502 -23.7 383 In order to remain in this favorable position, the company must efficiently manage operations. Unfortunately, accounting profit is subject to arbitrary adjustments in-house and is not an entirely reliable tool when judging the efficiency of the company. The stock turnover rate increased by 1.9% in 2011 but decreased by 5.3% in 2012 as a result of the significant increase in stock levels. This indicates an inability of the company to sell its merchandise fast enough. The company is averaging 3 inventory turns per year; this is of particular concern to a retailer which should be capitalizing on stock that consists of fast moving consumer goods To keep stock levels manageable and encourage consumers to buy more, Hewlett appears to have encouraged more credit sales. Consequently, this has increased from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬300M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬600M in 2012. If debtors are slow to pay, the company will run into cash flow problems reducing its ability to cover debt. The trade debtor collection period has decreased from 599 days in 2010 to 383 days in 2012, still a considerably high figure. This is because credit sales have increased at a faster rate than the average number of debtors. So, while Hewlett might be selling more on credit, it appears to be doing so to a manageable number of debtors who appear to be paying on time. This is good for the companys immediate cash flow. Gearing Ratio 2010 % change 2011 % change 2012 Gearing Ratio (%) 46.2 +24.7 57.6 +7.8 62.1 Interest Cover (times) 1.6 -18.8 1.3 -23.1 1.0 Debt Ratio 0.71 +5.6 0.75 +4.0 0.78 Debt-to-Equity Ratio 2.3:1 +17.4 2.2:1 +22.2 3.3:1 Debt Leverage 8.9:1 -2.2 8.7:1 +1.1 8.8:1 As the company has financed itself more and more through loans in recent years, the banks concern regarding increased lending is understandable. Loans increased by 62.5% in 2011 and a further 17% in 2012. As a direct result, and exacerbated by the fact that the loans to Hewett are unsecured, the interest payable ballooned from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬25M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬60M in 2011 and then ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬110M in 2012. That translates to a 140% increase in 2011 followed by an 83% increase in 2012. Although profit before interest and tax (PBIT) has increased from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬95M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬140M in 2012, the strain of the interest payments is shown on the companys bottom line. Even though taxes have decreased, the net profit available (after tax and interest payments have been deducted) decreased from ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬47M in 2010 to ÃÆ' ¢Ãƒ ¢Ã¢â€š ¬Ã… ¡Ãƒâ€šÃ‚ ¬20M in 2012. To give a clearer picture of the long-term financial position of the company, the capital gearing ratio shows just how much of the company is currently financed by loans. This ratio has increased considerably from 46.2% in 2010 to 62.1% in 2012; the company is highly geared. This combined with falling net profit indicates that the company may have trouble paying interest in the future. Ideally, business financing should be a healthy combination of equity and loans, and this is not the case with Hewlett. Reserves have remained stagnant in the presence of rising loans. The balance of capital is unhealthy, especially in a depressed economy. This is shown further by the decrease in interest cover. Hewlett could cover its interest payments 3.8 times over in 2010 but can only do so 1.3 times over in 2012. In essence, the company is over committing itself in its borrowing. Looking past interest, and at the overall debt situation, liq uidity ratios give an understanding of Hewletts current ability to pay off debt based on historic numbers. To make a projection about how much of a factor debt will be in the overall picture in the future, the debt ratio must be considered. This is because it gives an idea of the companys reliance on debt for asset formation. Hewletts debt ratio has increased incrementally from in 0.71:1 in 2010, to 0.75:1 in 2011 and then 0.78:1 in 2012. This indicates that the company has increased its reliance on debt for asset formation. The increasing debt to equity ratio buttresses this point. This has increased from 2.3:1 in 2010, to 2.7:1 and then 3.3:1 in 2012 as bank loans and other interest borrowings have increased. The company is trending towards being over-leveraged resulting in a debt repayment burden that may eventually prove too much to bear. Consideration must be given to the fact that the Greek stock market has suffered greatly in the past three years as figure 3 below shows, w ith stocks most recently dropping an average of 50 index points in October 2012. This indicates that the company is hamstrung by the current economic climate and unable to significantly increase equity. Figure 3: Greek stock market performance (Trading Economics 2012) In essence, because increasing equity is difficult, Hewlett will have to cover any debt with its own cash generated. The debt leverage ratio has remained fairly constant, from 8.9:1 in 2010, to 8.7:1 in 2011 and then 8.8:1 in 2012. Ostensibly, the companys ability to cover its debt with its operating cash flow has worsened. The possibility of the company defaulting on its loans is a reality. RECOMMENDATIONS Hewletts profitability has decreased while liquidity and the efficiency of operations have fluctuated while gearing has increased. The company is overcommitted as earnings before interest and tax (EBIT) are not increasing fast enough to keep up with rising interest payments (due to the unsecured nature of the loans) resulting in lower retained profit. Based on recent performance, the ratio analysis shows that increasing lending to the company will most likely accelerate the process by which the company will eventually default on its interest payments and then ultimately its loans. To ensure the continued, profitable operations, the bank should advise the company to reduce the scale of its operations like a number of retailers in Greece have done by closing some stores. This will help to ensure the company only keeps in operation the number of stores for which it can cover expenses. LIMITATIONS There are a number of limitations that have hindered this analysis. First of all, parts of the financial statements generating process are subject to internal manipulation. Secondly, this analysis is based solely on numbers and does not take into account issues like product quality and employee performance which are key factors in financial performance. Also, ratio figures for companies in the same industry are not available for comparison. Therefore this analysis cannot prove for certain that the issues faced by Hewlett are peculiar or industry wide. The inventory turnover ratio is based on year end stock levels; access to monthly or weekly levels would give a better indication of how well the company turns over its stock. Similarly, access to information regarding the companys credit purchases would give an idea of the length of time the company is currently taking to pay its short term creditors. In addition, while the projections in this analysis are based on the current eco nomic climate in Greece, the situation is poised to change due to planned bailouts from the Eurozone and so performance trends might change.

John Locke And George Berkeley - 1011 Words

John Locke and George Berkeley are two respected individuals in the world of philosophy. These two brilliant minds impacted the philosophy and brought new ideas that are worth noting. John Locke is famously known for his belief in tabula rasa or blank slate. He believed that knowledge was not innate in humans at born, but it is learned experiences that give us knowledge. Example, a psychiatrist understands how to help a client with this problem that may be new to the psychiatrist because he/she would use what they’ve learned before to help that client. This example shows that we learn things through experiences and gain knowledge through our past experiences. Another example plays on Locke’s theory that are just objects that we add elements to it. It’s separated in two terms; primary and secondary. Primary refers more to just the shape, the weight, or location and secondary refers to the color, taste, smell, and other qualities that give us a sensation. 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Contextual Factors for Entrepreneurship - myassignmenthelp.com

Question: Discuss about theContextual Factors for Innovation and Entrepreneurship. Answer: Introduction: Innovation and entrepreneurship is the contextual factor that has great impact on the functioning of the companies. Entrepreneurship is the factor that is related to the activities that are conducted by the organizations (Teece, 2010). It is not necessary that every business have that entrepreneurship quality in them. Innovation is one of the factors that drive entrepreneurship. This is because it is required by the companies these days to be innovative so that they can attract the customers by offering them something new. This essay aims at identifying the contextual factors and their impact on the strategy and decision making practices of the company. The contextual factor that has been discussed in this essay is innovation and entrepreneurship at the business. The scope of the study suggests that the contextual factors affect the companys functioning and understanding this impact can help the company to strategize itself. Contextual Factor: Entrepreneurship refers to the capability of the person to develop mad organize the business processes in order to conduct the business activities along with taking the risk associated with it to earn the profit (Drucker, 2014). It can also relate to exploit the opportunities available in the marketing a fulfilling the needs of the market. The theoretical aspect of the factors suggests that risk taking is the first and foremost quality that should present in the entrepreneur. Economic theory of entrepreneurship relates the risk taking aspect with entrepreneurship. The criticism of this theory deals with non-consideration of other factors such as the environment changes and resource availability (Tidd Bessant, 2015). Thus, this theory has not been accepted. Another theory that is based on resources have been developed which suggests that entrepreneurship is about exploiting the opportunities and using the resources available to conduct the business activities. Innovation is also cons idered as the major contextual factors that affect the functioning of the company. It can be defined as the aspect that brings changes in the existing functions or processes or developing the new ones according to the requirement of the market. As both the entrepreneurship and innovation is related to fulfilling the needs of the market thus both are the important aspect of business. Impact on Strategy and Structure of the Company: As per the business discussed in the above case, it has been identified that it is the company that operates in supermarket industry. Supermarket retail industry is very saturated thus developing new and innovative products and processes is the basic requirement of the company (Franke, Harhoff, Henkel Hussler, 2013). It is not only the new products that required to be developed but the structure of the company needs to be innovated in order to attract the market and compete with the competitors. As far as entrepreneurship and innovation in strategic management is concerned, it has been analysed that there are three types of entrepreneurship in the business that can be implemented by the above discussed company. The first one is about creating something new in the existing business, second is transformation of the organization and third one is the changes in the competition rules for the industry (Galindo Mndez, 2014). As the business is new, it is required by the company to come up with any new products that can attract the customers along with innovative process of customers interaction. This is because it is the process that directly deals with the customers and can be noticed by the customers. It has been analysed that structure of the company and the strategies used by the same gets affected by the entrepreneurship level of the company (York Danes, 2014). If the company has the capability to exploit the resources then it may have different strategies along with contingency planning while the company does not have the capability to take the risk then it may have strategy without contingency plan. As per the above business, it is required by the company to implement the strategies that are without risk because it is the new business venture and if the risks have been taken at the initial stage of the business then it may be possible that business fails to penetrate in the market (Kerr, 2013). Today, businesses are using many innovative technological method s in their processes. Communication is one of the processes in the business that required to be focussed upon so that the business can interact with the clients and with the other staff members. Intranet is one of the strategies that are a new innovation in terms of communication inside the company. As the company operates in supermarket industry, so it also needs to develop the technological tool for the stores so that all the stores can be linked to each other (Bierly, Gallagher Spender, 2014). The tools such as intranet application can be made so that the staff of different stores can share information about the inventory and the goods with each other. Impact on the Decision Making of the Company: Decision making is the function of the company that needs to be conducted with a proper process. This is because the outcome of this function decides the fate of the business in future. All the strategies and the processes conducted in the company depend on the decision that has been made for the company by the management. This is the function that needs to be conducted on daily basis at lower levels (Bessant Tidd, 2007). Small decision regarding any of the issues faced by the company needs to be taken by the mangers in which the top management of the company is not involved. In case of supermarket, store managers are the one who needs to take the decision daily as they have to deal with the stock and the sales at daily basis. The store managers also have to show their entrepreneurship skills at this time because it is not possible to ask to the top management about every issue faced at the store (Oliveira, Rozenfeld, Phaal Probert, 2015). Innovation in the daily processes and func tions of the store such as implementation of the intranet process or the application that is used to record the data of the sales and the inventory helps in making decisions. This is because the data is clearly sorted in front of the managers. He can easily look for the drawbacks and the areas where the issues are generated thus decision making process also become easy (Jerinabi Santhi, 2012). It becomes speedy as well because use of technology in such processes helps in analysing the data with high pace and thus decision can be made easily. This also results in making effective decision as the data is accurate if calculated from this application. Human efforts reduce by using such applications. No staff can do any illegal or unethical practice in the store because all the data is captured with the help of the bar code on the products. This helps in analysing the sales and inventory stock of the products easily. The staffs need to count the products manually but the data is recorde d in the software that helps in identifying the products quantity at the store, this information of the data helps in managing the inventory (Windrum Koch, 2008). The store manger can make the decision over the ordering of the products according to the quality left. Counting the products manually take too much of time and efforts are also very high in this case. As far as the entrepreneurship is considered, it should be there in each and every employees of the company especially the ones who deal with the customers directly. Conclusion: It has been concluded from the report that entrepreneurship and innovation are the basic elements that needs to be considered by the companies in order make the process effective and efficient. Entrepreneurship is the factor that is related to the activities that are conducted by the organizations. It is not necessary that every business have that entrepreneurship quality in them. Innovation is one of the factors that drive entrepreneurship. This is because it is required by the companies these days to be innovative so that they can attract the customers by offering them something new. But these contextual factors have their impact on the strategies that the company make and the process of their decision-making. It has been analysed from the above case that supermarket business can enhance their in-store process by implementing the technological tools in their store so that they can record various data in the application used. This data can helps them to take better and efficient dec ision regarding the sales and the inventory. References: Bessant, J., Tidd, J. (2007).Innovation and entrepreneurship. John Wiley Sons. Bierly, P., Gallagher, S., Spender, J. C. (2014). Innovation decision making in high-risk organizations: A comparison of the US and Soviet attack submarine programs.Industrial and Corporate Change,23(3), 759-795. Drucker, P. (2014).Innovation and entrepreneurship. Routledge. Franke, N., Harhoff, D., Henkel, J., Hussler, C. (2013).Innovation und Entrepreneurship. Springer/Gabler. Galindo, M. ., Mndez, M. T. (2014). Entrepreneurship, economic growth, and innovation: Are feedback effects at work?.Journal of Business Research,67(5), 825-829. Jerinabi, U., Santhi, P. (Eds.). (2012).Creativity, Innovation and Entrepreneurship(Vol. 1). Allied Publishers. Kerr, W. R. (2013).US high-skilled immigration, innovation, and entrepreneurship: Empirical approaches and evidence(No. w19377). National Bureau of Economic Research. Oliveira, M. G., Rozenfeld, H., Phaal, R., Probert, D. (2015). Decision making at the front end of innovation: The hidden influence of knowledge and decision criteria.RD Management,45(2), 161-180. Teece, D. J. (2010). Business models, business strategy and innovation.Long range planning,43(2), 172-194. Tidd, J., Bessant, J. (2015).Innovation and entrepreneurship(No. 3). Wiley. Windrum, P., Koch, P. M. (Eds.). (2008).Innovation in public sector services: entrepreneurship, creativity and management. Edward Elgar Publishing. York, J. L., Danes, J. E. (2014). Customer development, innovation, and decision-making biases in the lean startup.Journal of Small Business Strategy,24(2), 21.