PhD in Public Administration Liudmyla Velychko

Oles Honchar Dnipropetrovsk National University (Ukrainian)

Grounding of decisions and eVALUATION of risks while TRANSFORMATION OF ENTERPRISES

 

Complex grounding of decisions and risk evaluation is an essential part of effectiveness in the system of government management in contemporary conditions. This issue gains significant actuality during major transformational changes in the society. An example of that can be the experience of carrying out the agricultural reform in Ukraine in the late 1990s.

Then each of the existing alternatives had both strengths (opportunities) and weaknesses (threats).

At that the decision concerning the direction of reformation in agricultural sector of economy was made considering certain limitations and under the influence of pressing factors on selection of the alternative in the system of governmental management. Among them are the following factors: long-term steady stagnation in agricultural sector of Ukraine; acute priority towards solving current tasks in the economy of the country compared to strategic ones (financial-economic crisis in 1998, devaluation of hryvnia, decrease in living conditions and so on.); memories about vitality of solving precisely food problem in the USSR as an example; impossibility of reaching a political decision concerning the opening of the civilized market of land as means of agricultural capitalization and increase of agrarian economy under market conditions; existing gradual allotment in resources of collective enterprises toward private-corporate sector (through unequal conditions of the required cooperation with machine-technological stations and suppliers, barter agreements with traders, low motivation for effective work and so on); potential preconditions to directing private national capital from other fields of economy into agriculture and so on.

The made decision about rapid reformation of collective agricultural enterprises in the organization of private-cooperative type can hardly be considered as a flawless one however it can be viewed as temporary optimal considering positions of existing at that time limitations and factors of internal and external pressures.

As a consequence the post-reform rates of economic growth in agriculture of Ukraine during 1999-2014 proved to be more than reassuring, which can be evidenced by the increase in grain export by 14,4 times; labor productivity increased by 11,5 times; gross grain harvest 2,6 times; harvest productivity of grain cultures 2,1 times; gross produce of agricultural sector in constant price of 2010  1,7 times [1].

But in the civilized world the agrarian sector is not considered as exclusively the producer of food and source of budget replenishment, it is a complex social-economical system which is at the same time focused on development of local rural areas.

Corresponding risks from selecting the third alternative turned out to be insufficiently evaluated in social and economic ways which negatively influenced further development of Ukrainian rural areas.

Therefore contemporary decisions in the system of government management should consider risks in a more complex way and they should be directed at intensification in the level of agricultural harmonization in Ukraine. Thus it is necessary to achieve a certain social-economic compromise between growths in production levels of agriculture and development of rural areas. The international experience reveals that the latter is significantly supported by the development of farm-cooperative model which harmoniously improves export-oriented private-corporate agribusiness [2].

 

List of references:

1. State Statistics Service of Ukraine. Retrieved from : http://www.ukrstat.gov.ua

2. Velychko O., Velychko L. & Ramanauskas J. (2016) Transformation and development of production-logistics enterprises in Ukrainian agrarian sector. Management Theory and Studies for Rural Business and Infrastructure Development. Vol. 38. 1. pp. 320.