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Diversification as a Method of Ensuring the Stable Development of Enterprise
Kozyk V. V., Stepankiv N. Z.

Kozyk, Vasyl V., and Stepankiv, Nazar Z. (2024) “Diversification as a Method of Ensuring the Stable Development of Enterprise.” Business Inform 2:153–159.
https://doi.org/10.32983/2222-4459-2024-2-153-159

Section: Economics of Enterprise

UDC 338:334.001.8

Abstract:
Diversification is considered as an effective method of stable development of enterprise in the long term, which makes it possible to timely and promptly respond to changes in the needs and market conditions by functioning in different markets, which is relevant in the current conditions of market instability, rapid decline or disappearance of demand for individual goods and services. In order to achieve the purpose of the article, i. e., clarification of the essence of the concept of «diversified enterprise», the literature sources are analyzed and the authors’ own experience of studying the activities of such enterprises is applied; the diversity and lack of a clear understanding of the very concept of diversification of production are established, which does not allow to make generalizations about the activities of the enterprise. The research in the article is carried out using the methods of generalization, abstraction, analysis, synthesis. With regard to the definition of the essence of diversification of production, and, consequently, of enterprise, the expediency of allocating the factors that characterize the causes, results, breadth of coverage of directions and spheres of activity, structural structure has been determined. This made it possible to form a definition and interpret diversified enterprises as business structures that expand existing areas of activity or create new ones, organizationally (with allcation or without separation of business units) and/or legislatively (contractual, legally formalized) independent or dependent in a pure or mixed form, ensuring the achievement of relevant goals due to current and/or strategic reasons. The presented conclusion summarizes the substantiation of a unified approach to understanding the essence of diversification of enterprise as an effective method of its stable activity in the long term, focuses on the factors characteristic of diversified enterprises, the combination of which ensures their competitive advantages. The given interpretation of the concept of «diversified enterprise» will contribute to a simpler, clearer, more effective allocation of specific universal types (kinds) of these structures.

Keywords: diversification, key elements, essence of the concept, approaches to interpretation, development of diversified enterprises.

Bibl.: 25.

Kozyk Vasyl V. – Candidate of Sciences (Economics), Professor, Professor, Department of Economics and Business Investment, Lviv Polytechnic National University (12 Stepana Bandery Str., Lvіv, 79013, Ukraine)
Email: [email protected]
Stepankiv Nazar Z. – Postgraduate Student, Department of Enterprise Economics and Investments, Lviv Polytechnic National University (12 Stepana Bandery Str., Lvіv, 79013, Ukraine)

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