Figure 8 Four-factor model of a business enterprise system.
Related Figures (9)
Figure 1. Observational space for analyzing historical change events in a societal struc- ture. Figure 2. Societal perceptual space event box with 15 topological explanations. A note on the research methodology shown in Figure 2. Figure 3. Analysis of Wirecard Bankruptcy in 2020. Figure 4. Adding auditing and regulation into the analysis of the Wirecard event. Figure 5. Financial transactions occur over time, with both rents and liquidity. As long as a financial market rises, the speculative trading can be profitable But when prices in a financial market rise speedily and traders purchase the cap- ital assets with high leverage, then rents from the assets cannot service either the interest or the principal payments in the loan, then the trader must “flip” (im- mediately resell) the asset. This is the stage of a financial bubble, and Minsky called this “Ponzi financing”. At this stage, the financial bubble will burst, as al! Ponzi financed assets must be immediately flipped; and then the market for the capital assets collapses. In this model of financial transactions, “leverage” is < measure of how much is borrowed to purchase the financial asset. Leverage car increase profits which selling a purchased asset. But too much leverage in a fi- nancial market can crash the market. Figure 6. Financial market supply-demand curve over time—financial bubbles. Figure 7. Porter’s valued-added production model and open-system model of a produc- tion firm. The upper box lists the four strategic factors which can be used to construct a Figure 9. Six types of strategic business models of business enterprises. juickly became clear that the company’s top echelon had spent years deceiving operation. Olaf Storbeck wrote: “In the aftermath of Wirecard’s collapse, it management even stole cash from Wirecard’s Capital. Figure 10. Production model of Wirecard in reality. investors, regulators, auditors and large parts of its own staff. But what the in- ternal communications also show is that the confused and disorderly scenes of its past few weeks were anything but an isolated incident. The documents and testimony reveal a company shaped by persistent mismanagement. Wirecard had presented itself as one of Germany’s rare technological success stories; but on the inside, it was a chaotic, byzantine and often ineffective organization. In one of the most striking examples of the weakness of Wirecard’s business, many of the operations that actually existed had been lossmaking for years, and some were heavily cash-burning. Even Alexander von Knoop, the company’s chief fi- nancial officer, was not fully aware of the extent of the losses. In one instance, he was outraged when he learned in July 2019—some 18 months after his appoint- ment—that Wirecard’s relationship with Aldi, the supermarket chain it had boasted about being one of its clients, had generated close to €5 m in losses over the previous three years. “With all due respect for flagship clients, what is the plan to become profitable with Aldi in future?’ he asked his underlings by email. He never received a convincing answer.” (Storbeck, Financial Times June 25, 2021)
