DEVELOPMENT OF A CLASSIFICATION OF STRATEGIES FOR OPERATING ACTIVITIES OF AN INDUSTRIAL ENTERPRISE

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Published: Jun 20, 2024

  Innola Novykova

  Viktor Leshchynskyi

Abstract

The article examines the issues of assessing the effectiveness of the strategy of the operating activities of industrial enterprises. The operating strategy of an industrial enterprise shows a method of production and sale of products that has certain quantitative parameters. The indicators of the enterprise's operating activity depend on the efficiency of the use of working capital, which ensures the uninterrupted nature of production and sales of products. However, the classification models of working capital management strategies that exist in economic theory are characterized by a number of significant shortcomings, the main of which is the lack of quantitative parameters that make it possible to draw a clear line between different types of strategies. We have proposed to build a production function in which the volume of production and sales of products is considered as a target indicator that depends on two factors – the volume of working capital and the duration of their turnover. The study of this function showed that, depending on the behavior of revenue, two main groups of strategies for the operation of an enterprise are possible – growth strategies and decline strategies, and depending on how exactly this happens, four options for growth and decline strategies are possible in each group: extreme – intensive and extensive, and intermediate – sub-intensive and sub-extensive. The classification model we have proposed for the eight strategies of an enterprise's operating activity allows, according to financial statements, to determine the type of operating activity strategy used by the enterprise in the analyzed period.

How to Cite

Novykova, I., & Leshchynskyi, V. (2024). DEVELOPMENT OF A CLASSIFICATION OF STRATEGIES FOR OPERATING ACTIVITIES OF AN INDUSTRIAL ENTERPRISE. Baltic Journal of Legal and Social Sciences, 94-105. https://doi.org/10.30525/2592-8813-2024-spec-10
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Keywords

model, strategy, enterprise, efficiency

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