Monday, May 21, 2012

Fwd: NU12 IDEAS (WEEK 1 to 5) CDA

---------- Forwarded message ----------
From: Carl Harvey Abugan
Date: Wed, May 16, 2012 at 2:33 PM
Subject: NU12 IDEAS (WEEK 1 to 5)

Hi Sir,

Attached is my NU12 Ideas for your reference. I resent it today as discussed in class yesterday. You can cross chek my entries from the ones you receive (to prove I am religiously complying...)  hahahah.. :)

PS: Kindly not post my week1 to week3 (if in case it merits posting :) ). It is only after week 3 that i saw several topics that i can use for NU12.
Would appreciate if you confirm receipt of my entries

Thank you sir. 


Carl Abugan

NU12 WEEK 1 – CD Abugan
What opportunities do you find in your job/personal life to improve, to earn more, save on expenses?
What did you discover to solve existing problems, to improve your professionalism and paradigm, productivity. How did your ideas/actions impact others.
                The focus of this paper is opportunities that I found to improve on my personal life particularly on my health (as stated in the syllabus).  The emphasis here will be the benefits a particular health opportunity will give me.
Veggie Lover                                                            
                Ever since I was young, I am not used to eating vegetables.  Among the family, it is only me who was not able to learn to eat vegetables.  I don't like the taste of leafy vegetables especially the uncooked ones. I can only think of two to three vegetables I can eat but it has to be well cooked before I eat it. Looking back, I regret not being accustomed in eating vegetables. I use to tell my mom that perhaps it's her fault since she didn't force me enough or scold me enough when I was child to eat the veggies on my plate.  Although I still don't like eating vegetables, I am slowly starting to learn eating it, "one vegetable at a time" for several practical reasons. First is the hassle of segregating vegetable from the food you are eating.  It is often hard and tedious to separate the vegetable components of a burger, clubhouse sandwich, pansit or kare-kare.  Second is that more often than not, I am embarrassed when I dine with my colleagues or acquaintances being someone that would chose not to eat vegetable. Third is the fact that vegetables are healthful for the body. Fourth is the fact that eating vegetable gives you more choices - it is easier to lose weight in diets that involves vegetable, it is easier for you to pick a food in a restaurant, etc.  Lastly, vegetables are generally cheaper (compared to beef, chicken, pork or fish). I would love to see the day where my breakfast or dinner will just be a plateful of salad. Indeed, one way for me to save on expenses is to eat more vegetables.       
Gym Rat
                For almost a year, I have availed a membership from a gym chain in metro manila. Unfortunately, due to my busy schedule – work load, school and extracurricular activities, I have to say that I do not maximize such membership.  I have long realized that it is a profit leak for me - paying for something that I do not normally use.  So what do I plan to do? I intend to create a paradigm shift in my gym membership in order for me to maximize what I am paying for and for me not to feel bad at the end of the day.  First, is to create a monthly target of visits to the gym.  I have calculated that 6 visits will be my targeted frequency. Being able to visit the gym that number of times spreads the cost of my monthly payment equivalent to a good meal in restaurant or movie ticket.  I would start to say to myself that instead of eating out or spending money for movies, hitting the gym is a more practical and reasonable decision.
Yosi Kadiri Attitude
5 years ago, I picked up my first cigarette. It was only when I started working where I learned to smoke cigarette.  I can't recall the reason why I get hooked to such vice - maybe out of boredom and conformity. Perhaps it is not anymore important to determine whatever motive I have back then, what's important is that I can think of hundreds reasons why I should stop. Though I haven't fully stopped, I have significantly cut down my cigarette consumption. Some people say that such cut back is useless and that by not quitting fully will eventually lead me back to where I used to. However, I would like to say to myself that I will quit on my own pace and in my own terms. I may not see the urgent need to quit now but I will definitely do it. However, I realized that limiting my cigarette consumption gives me a little bit more savings/change. I usually buy in packs and often purchase lighters as I easily lose them in the process. By cutting down in smoking, I have more change to spare for parking, tips, or alms to the poor. Though this might not really be a big deal for it to be considered savings, it makes me feel good that I spent my money where it's more worthwhile.
Though this paper is about opportunities that improve my health condition, I can't help myself to mention opportunities that improve my current work condition. Ever since I have been a goal oriented person. At the start of my career, I said to myself that two of my mid-term goals were (1) VP/Director level position by age of 28 and (2) to make my first million by the age of thirty (and by first million mean liquid cash/asset). Though I am still very much on track in reaching that goal, I feel pressured as I reach that age. Moreover, I realized that being a corporate employee might not be the best path in reaching that objective of mine.  Thus, 6 months ago I decided to take a leap of faith. I put up my own business.  I believe that it is only by doing this that I can reach my goal on-time , with less pressure and more to spare. As I have mentioned in my personal information and previous paper, I am forced to side track on this goal and go back to corporate world.    4

NU12 WEEK 2 – CD Abugan
Recently, I got the money I invested for a townhouse property.  For several reasons, I chose not to pursue in buying the said property and the developer willingly refunded the down payment I made for the past 2 years. Suddenly, I am very liquid but it doesn't mean that I am rich. These are forced savings since this was supposed to be in the form of investment.  I realized that though I am liquid, I have to find a way in order for it to grow.  Based on my experience, money on hand or money that can be accessed quickly has more tendencies to be spent more often in unnecessary items. As such, I am forced to find way where to put my money in good use.  But the big question is where and how? As mentioned, I recently went back to the corporate world after having a short stint of being a full time entrepreneur.  So I am more limited in terms of my options given the fact that my time is divided with work and the potential business venture that I will pursue. Top of mind businesses/part time careers that I would like to pursue are the following:
1. Transportation
                This has been the business of my parents for more than 10 years already. When they started working in Metro Manila for a government institution (Securities and Exchange Commission), their savings were invested in transportation business that would support our local community. They started with public utility tricycle, then later to jeepneys and taxis. This was easy to manage as the operation itself does not require them to be 24/7 and hands-on. The set up of operations is a boundary system and simple management, monitoring and financing knowledge is required to run such information. This led me to buy one of their units during my second year of working.  Though it provides minimal income per day, it provides me an additional income that would pay for my daily expenses (i.e. food, transportation, etc.). Thus, I am planning to buy one more unit for me to multiply my daily earning potential without requiring so much of my time and effort.
2. Part-time Teaching Position
                It has been my desire also to teach students at the collegiate level. I may sound idealistic but I wanted to give back to society in general by doing a noble task such as teaching. Money earned from the part time teaching post will probably be small and may be not worth the effort but at the end of the day it is one of the things I needed to do to satisfy my personal interest. I have started seeding my resume to local schools providing college education early this year. I am targeting schools not part of the big universities as I feel the need to raise the level of teaching in these schools. However, I need to double my efforts in sending out my resume to capitalize the fast approaching school year. 3
3. Marketing Consultancy
                Lastly, one of the services the company I have put up is marketing services. One of the service sis to provide Below the line promotional activities for clients to provide targeted and more efficient marketing spends and campaigns. I may not have the time and resources to devote my time fully in this endeavour but being a consultant and resource person from other agencies that I have worked with in the past has always been an option I am considering.
I technically just have one business idea to invest my money as of the moment but I hope I can come up with more business ideas and options before I spend all my savings to something non-sense. 3

NU12 WEEK 3 – CD Abugan
                Businesses use three important financial statements – Balance Sheet, Income Statement and Statement of Cash flows.  From these, important and critical decisions are made.  More often than not, the future of the organization is dictated by these figures.  More importantly these measures a company's business financial health and capacity.
                After being exposed to such financial statements at school and at work, I came to appreciate the power and relevance these figures can bring to a simple individual. If one can comprehend such data and see its practical implications then surely it can help in managing one's finances.  I believe that this is an important topic for "wanna-be's" or start-up entrepreneurs since managing resources is definitely a critical business activity. 
                Lately, I have been monitoring and stringent on my finances (to a point that I even drafted a personal income statement and cash flow). For this week's NU12 paper (and for the next 2 to 3 weeks), I would like to share some insights taking off from the perspective of financial statements which others may consider a boring set of numbers. 
Monitoring cash flows
We see in cash flow statements classifications of spending whether it's operating, financing and investing activities. I realized that I have numerous types of spending and probably one of the first step in saving significant amount of cash is to identify these expenses so as to give me a picture and appreciation how cash should be spent. Currently, my cash inflows are only from the following sources: monthly salary, transportation business, occasional allowance from parents and interests in bank accounts (minimal). Cash outflows are generally expenses I incur in my daily activities and all other items I need as a social human being– transportation, meals, communication,  etc.
One key opportunity will be to look for more investing activities as this has minimal outflow. In effect, the net amount of cash can fund for investing activities but then again the question is to where or what type of investment? The idea is to put this money where it can generate returns.
Another is to cut down on dates and budget for vices, vacation and miscellaneous. Though it is accepted that this are needed for a normal social being it can be lessened to a certain extent. As my father always say "You should leave within your means". I have already taken measures to cut on other expenses such as transportation and communication. Though it is relatively small, it has great effect in terms of my monthly cash flow.  3

NU12 WEEK 4 – CD Abugan
What pisses me off in the mall?
I believe everyone who drove to a mall driving or inside a car has experienced the security guard checkpoint. Majority of them, mostly as routine, will ask you to open up your trunk for inspection. Some of them often carry a steel stick with mirror at the end use to inspect the bottom of your car (which up to now I still don't understand the purpose).  This is a common sight but the question is that is it effective? Did such process eliminate or limit security threats? Probably not!
So as a recommendation, I thought why can't a car scanner be installed in malls? Similar to the one that one passes through as security check in airports? Or a big scanner similar to where luggage go through in airports? This will probably be more effective as it actually detects potential threats and is more cost effective (in the long run) since there will be no more security guards to conduct actual checking 3

NU12 WEEK 5 – CD Abugan
5/6 system is a common financial instrument people from the lower social class avail. It is popularized by the image of a "bumbay" (sorry for the term) driving in motorcycles (whether individual or in tandem) going around neighborhoods usually catering to small scale vendors (though there are Filipino also who does this).  Normally these Indian nationals offer to loan cash (some offer product on credit) wherein they lend or give credit at 5-6 rate or at a nominal rate of 20% over an agreed period of time. They often do not require collateral or documentary proofs to support such transaction – "The success of a borrower's business and loan repayment history provide a gauge of the borrower's credibility".  So technically, this system rely heavily  in the simple idea of trust, honor and integrity.
 In my previous sales company, it was a running joke that you have to be in the trade early as there are lots of competition, main of which are the Bombay who lends 5/6. Why do 5-6 pautang system thrive? Many documentaries and articles have been filmed and written already featuring people who have either benefitted or victimized by this system.  I have come across several articles as this was supposed to be a topic for my business plan (here is an interesting link about Bombay 5-6 Credit System
Most people see this system very oppressive. Indeed, this financial scheme/system presents extremely high interest rate in financial terms. They are higher than what banks usually offer for a regular/normal loan.  But simple law of economics says that high risk should give high returns. Obviously, the business model of 5/6 is indeed susceptible high risk.  Why is this despised if it operates in a sound business concept?  Lenders and lendee mutually agrees to this transaction. How can one say that it is worse than a company who over price a product/service 500 to 1,000 times?  Is it because of the stereotypes and the channel/market where they operate? Is it because of the nature of the customers they are dealing with? Whatever people may say, there can only be this fact – there is a market, a huge one in fact.
So what can be done to mitigate the two opposing views? Indeed there is high return on this but it is also important to consider the deeper hole this might bring to Filipinos. Why can't banks do that? To make financial leverage easier to avail? Why do we need to come to banks? Why don't they come to us? That has been the trend nowadays.
 There's only one solution I can think of this:
A business model similar to 5/6 Bombay pautang system at a lower interest rate through economies of scale. < how?>