Scientific and Methodical Approach to Adaptive Diversification of Industrial Enterprise Development under Crisis Conditions

Hanna Tarasova

doi:10.34021/ve.2018.01.01(3)

Authors

Hanna Tarasova Kyiv National University of Technologies and Design, Kyiv, Ukraine https://orcid.org/0000-0002-5476-9881

DOI:

https://doi.org/10.34021/ve.2018.01.01(3)

Keywords:

adaptation, diversification, development, industrial enterprise, assessment, strategic reference points, crisis

Abstract

Ukrainian enterprises face the challenge of operating in a climate of continuous economic crises and evolving economic conditions due to the country's deeper integration into global markets. This integration highlights a significant gap between the current state of domestic industrial enterprises and the economic environment's requirements. Despite the urgency of this issue, there is limited research focusing on comprehensive strategies for enterprise adaptation and development in the context of recurring economic instability. The aim of this study is to develop a scientific and methodological approach that enables industrial enterprises to adapt their diversification strategies during crises, ensuring strategic development goals are maintained. The methodology of the study involves a two-step process: firstly, an assessment of current and potential economic crises that impact industrial enterprises, and secondly, the formalisation of these impacts to guide strategic decision-making. Data for this analysis were sourced from relevant economic and industry reports, allowing for an evaluation of crisis trends and their potential consequences for enterprises. The framework provided enables a structured approach to diversification that aligns with both crisis adaptation and strategic growth. The results reveal that the application of this approach supports industrial enterprises in identifying relevant diversification measures that can mitigate the adverse effects of economic crises. Enterprises that employ this model can maintain their strategic development trajectories despite challenging external conditions. This ensures a better alignment between enterprise capabilities and external economic demands. The discussion emphasises the practical implications of the developed approach, noting how its application can be tailored to different types of crises and industries. The findings underscore the importance of proactive crisis management and strategic flexibility for industrial enterprises in volatile economies. Future research should examine the long-term impact of diversification strategies on enterprise sustainability and expand the model's applicability across various sectors and regions to validate its effectiveness under different economic conditions.

Downloads

Download data is not yet available.

References

Cerrato, D., Alessandri, T., Depperu, D. (2016). Economic Crisis, Acquisitions and Firm Performance. Long Range Planning, 49(2), 171-185. https://doi.org/10.1016/j.lrp.2015.12.018

Chung, C.C., Lee, S.-H., Beamish, P.W., Southam, C., & Nam, D.-I. (2013). Pitting real options theory against risk diversification theory: International diversification and joint ownership control in economic crisis. Journal of World Business 48(1), 122-136. https://doi.org/10.1016/j.jwb.2012.06.013

Delas, V., Nosova, E., Yafinovych, O. (2015). Financial Security of Enterprises. Procedia Economics and Finance, 27, 248-266. https://doi.org/10.1016/S2212-5671(15)00998-3

Glushkov, V. M., Amosov, N. M., Artemenko, I. A. (Eds.). (1974). Entsiklopediia kibernetiki [Encyclopedia of cybernetics]. (Vol. 1). Kiev: Abs-Mir (in Russian).

Gadzevych, I.O. (2014). Rozrobka alhorytmu perekhodu promyslovoho pidpryyemstva do dyversyfikatsiyi yoho diyalnosti [Developing an algorithm for transition of industrial enterprise to diversification of its activities]. Scientific Journal of Kherson State University. Series “Economic Sciences”, 5(2), 58-62 (in Ukrainian).

Hroznyi, I., Kuzmak, O., Kuzmak, O. & Rusinova O. (2018). Modeling of diversification of foreign economic interactions. Problems and Perspectives in Management, 16(1), 155-165. https://doi.org/10.21511/ppm.16(1).2018.15

Kapitsinis, N. (2018). Interpreting business mobility through socio-economic differentiation, Greek firm relocation to Bulgaria before and after the 2007 global economic crisis. Geoforum, 96, 119-128. https://doi.org/10.1016/j.geoforum.2018.08.002

Kuzmin, O., & Drymalovska, Kh. (2013). Sutnist ta znachennya dyversyfikatsiyi na promyslovykh pidpryyemstvakh [The nature and significance of diversification in industrial enterprises]. Ekonomichnyy analiz, 12(3), 222-225 (in Ukrainian).

Lakhno, V., Malyukov, V., Bochulia, T., Hipters, Z., Kwilinski, A., & Tomashevska, O. (2018). Model of managing of the procedure of mutual financial investing in information technologies and smart city systems. International Journal of Civil Engineering and Technology, 9(8), 1802-1812.

Laperche, B., Lefebvre, G., Langlet, D. (2011). Innovation strategies of industrial groups in the global crisis: Rationalization and new paths. Technological Forecasting and Social Change, 78(8), 1319-1331 https://doi.org/10.1016/j.techfore.2011.03.005

Maidanevych, P.M. (2014). Kontseptualni osnovy rozvytku promyslovoho pidpryyemstva v umovakh kryzy [Conceptual bases of industrial enterprise development in the conditions of crisis]. Business Navigator, 1(33), 69-73 (in Ukrainian).

Milovanov, Ye. (2006). Strategiya diversifikacii - osnova finansovoj ustojchivosti mnogoprofil'nogo predpriyatiya bytovogo obsluzhivaniya [The diversification strategy - basis of financial sustainability of a multi-profile consumer services enterprise]. Problemy teorii i praktiki upravleniya, 10, 96-104 (in Russian).

Naidoo, V. (2010). Firm survival through a crisis: The influence of market orientation, marketing innovation and business strategy. Industrial Marketing Management, 39(8), 1311–1320. https://doi.org/10.1016/j.indmarman.2010.02.005

Orlova, K. (2015). Formuvannya orhanizatsiyno-ekonomichnoho mekhanizmu adaptatsiyi promyslovykh pidpryyemstv do zovnishnoho seredovyshcha [Formation of the industrial enterprises’ organizational-economic mechanism of adaptation to the external environment]. Problems of Theory and Methodology of Accounting, Control and Analysis, 2(32), 238-249 (in Ukrainian). https://doi.org/10.26642/pbo-2015-2(32)-238-250

Pająk, K. Kamińska, B., & Kvilinskyi, O. (2016). Modern trends of financial sector development under the virtual regionalization conditions. Financial and Credit Activity: Problems of Theory and Practice 2(21), 204-217. https://doi.org/10.18371/fcaptp.v2i21.91052

Prokopenko, R., Shishatsky, V. (2014). Konceptualnyj podhod k modelirovaniyu nalogovyh reakcij korporativnyh struktur [Modelling of reflexive adaptation of corporate structures to the tax environment]. Zhurnal Nauchnyh Publikacij Aspirantov I Doktorantov, 1(91), 18-19.

Sabatino, М. (2016). Economic crisis and resilience: Resilient capacity and competitiveness of the enterprises. Journal of Business Research, 69(5), 1924-1927. https://doi.org/10.1016/j.jbusres.2015.10.081

Swan, P.L. (2009). The political economy of the subprime crisis: Why subprime was so attractive to its creators. European Journal of Political Economy, 25(1), 124‐132. https://doi.org/10.1016/j.ejpoleco.2008.12.005

Williamson, P.J., & Zeng, M. (2009). Value‐for‐money Strategies for Recessionary Times, Harvard Business Review, 87(3), 66‐74.

Wong, L. (2009). The Crisis: A Return to Political Economy? Critical Perspectives on International Business, 5(1/2), 56‐77. https://doi.org/10.1108/17422040910938686