Management Systems

in 2022, Volume 30, Issue 1, pp. 9-17

Production Engineering

Date of submission of the article to the Editor: 12/2021

Date of acceptance of the article by the Editor: 01/2022
DOI 10.2478/mspe-2022-0002

INNOVATIONS IN LOGISTICS MANAGEMENT AS A DIRECTION

FOR IMPROVING THE LOGISTICS ACTIVITIES OF ENTERPRISES

Anzhela CHERCHATA, Iryna POPOVYCHENKO

Prydniprovska State Academy of Civil Engineering and Architecture

Uliana ANDRUSIV
Ivano-Frankivsk National Technical University Oil and Gas

Viktoriia GRYN
Zaporizhzhya National University

Nadiia SHEVCHENKO
Odessa State University of Internal Affairs

Oleksandr SHKUROPATSKYI
Yaroslav Mudryi National Law University

Abstract:
Nowadays innovations became the most important element of the country’s economic development, since they
provide a qualitative increase in the efficiency of processes or end production demanded by the market. In this
article, the innovation of processes, viz. the processes of logistic management of the production-economic organ-
ization is proposed. Innovations in logistics management, as a direction of logistics activity improvement provide
the development of new tools (methods, criteria, indices) in methodological logistics’ groundwork, as well as im-
proving the mechanism for the formation and functioning of micro- and macro-logistic systems. The aim of the
research is to develop scientific and methodological recommendations for the application of logistics manage-
ment innovations that involve designing the logistics system through the improvement of the enterprise’s organ-
izational structure as an element of the economic macro environment. Logistic system designing approach is sug-
gested, that anticipates an enterprise’s organizational structure formation under the process-matrix principle
(unification of functional and process management approaches) and the establishment of the effective enter-
prise’s logistic service that plays the role of coordinator and integrator of its business-processes. Efficient organi-
zation structure formation, that provides logistics approach implementation in practical enterprises’ activity is
grounded by authors. The result of the innovations in logistics management appliance is effective logistic system’s
design, in which the coordinated material, informational and financial flows motion is carried out. In the result, it
ensures efficient enterprise’s business-processes functioning and organic improvement of its organizational struc-
ture.

Key words: logistics management, enterprise, organizational and managerial innovation, business-processes,
logistics system

INTRODUCTION tiveness of the country, of course if there are efficient lo-

In the context of globalization of the economy, logistics gistics management. The role of logistics and its intercon-
has become an important component of the competitive- nectedness with the country's profitability and wealth is
ness and innovation activity of the enterprise. And at the demonstrated by the data presented in the report of
national level, the logistics industry makes a very signifi- World Bank for 2007-2018 [1]. The basis of ensuring the
cant contribution to GDP, general incomes and competi- efficiency of logistics management should be its innova-
 10 Management Systems in Production Engineering 2022, Volume 30, Issue 1

tiveness. Improving the efficiency of enterprise manage- According to Sergiienko et al. [20] any production-eco-
ment on the basis of innovation activity is the subject of nomic organization consists of three functional fields: pro-
regulation not only at the level of an individual country duction, finances and marketing. This is classical concep-
but also at the international level [2, 3]. Since a certain tion of the functional formation principle of the enter-
production-economic organization is a link of the supply prise’s organizational structure.
chain, the efficiency and reliability of the whole chain de- An enterprise can implement not entire process approach,
pends on the rationality and efficiency of its logistics sys- but, in accordance with Brown [21] propositions, apply ma-
tem. Therefore, we will focus further on this link, i.e. the trix-process structures. In this case vertical and horizontal
formation of the logistics system of the enterprise as an mechanisms of business-processes management will com-
element of the supply chain. The basic component of lo- bine, while some functional liability zones will be kept. But
gistic innovative systems activity is the organizational how can this matrix-process principle be applied during
management structure formation with high level of inno- the formation of the enterprise’s logistics system and dur-
vative reception. It facilitates interfunctional coordination ing the management of this system, which is essentially
during the process of enterprise’s business-processes cybernetic? Remind the definition of the "cybernetic sys-
functioning. tem" concept and formulate the definition of the logistics
system to ascertain the legitimacy of the logistics system
LITERATURE REVIEW perception as a cybernetic with all the consequences that
Studying theoretical achievements of foreign and appear in it. According to academician Orlovska [22], cy-
domestic scientists concerning the problems of innovative bernetic system is “a enormous number of intercon-
development of enterprises Davenport [4] and Andrusiv & nected objects called system elements that can perceive,
Galtsova [5] it could be concluded that the overwhelming memorize and reprocess information, and exchange infor-
majority of researches is oriented to the production mation also”. Hajinsky [23] defines the logistics system as
concept of innovation development, which focuses an adaptive feedback system that performs certain lo-
primarily on product and technological innovations gistic functions and logistic operations, which usually con-
Becheikh et al. [6] and Illiashenko & Shypulina [7]. In sists of several subsystems and has developed connec-
accordance with Oslo’s international standards, tions with the external environment. From the view point
innovation is the result of innovative activity, realized as a of business practice, the following definition of the logis-
new or enhanced product presented on the market [8]. tics system as a structured economic system can be given:
Many scientists focus on the organizational aspect of in- “The logistics system is a relatively stable body of links
novation Armbruster et al. [9], Andrusiv et al. [10], Cros- (structural/functional divisions of the company, as well as
san & Apaydi [11]. Certain researchers connect technolog- suppliers, customers and logistics intermediaries), inter-
ical and organizational innovations Camisón & Villar- connected and united by the single management of the
López. [12] and Cherchata et al. [13] among others. logistics process (their material and associated flows) for
However, in an unstable environment, increased compe- the implementation of the company’s operating strat-
tition in domestic and international markets and the egy”. In fact, the supply chain is a cybernetic logistics sys-
search for new reserves in entrepreneurial activity, the tem, and supply chain management is the integration of
key factors of success become not only industrial innova- key business processes that start with the end-customer
tions, but organizational and managerial innovations. and cover all goods suppliers, services and information
Therefore, the issue of intensifying the production of in- [24]. The questions of the impact of supply chain partners,
novative approaches to the management of logistics pro- as elements of the system, on the performance of each
cesses is relevant today. other are investigated in the article [25]. A representative
Logistics innovations can be considered as organizational sample of vertical relationships in supply chains (22,500
and managerial innovations aimed at flexible integrated observations) had been investigated. The authors reached
management systems building that provide the con- a conclusion that the presence of a productive partner in
sistency and balance of management decisions both the supply chain helps the firm to increase its own produc-
within certain functional divisions of the enterprise and tivity, especially if the firm’s client is a more productive
on the interfunctional level, as well as in the process of partner. Besides, the authors considered that the concen-
business relationships with external contractors. Such sci- tration of supply chain and the maturity of relations influ-
entists as Kinash [14], Gonzalez [15]; Little [16]; Ryikalina ence the productivity of the company, as an element of
[17] etc. that study logistic processes functioning prob- the supply chain.
lematic pay attention to logistics innovations. The importance of choosing suppliers policy in conditions
It is necessary to use special methodological toolkit to de- of possible production failures in the company's activities
sign logistic systems, to analyse, to estimate integrated is explored in the article [26]. Costs and benefits of a flex-
flows processes management efficiency in order to opti- ible strategy for interacting with suppliers, viz. the availa-
mize costs, that is ultimate aim of logistic strategy realiza- bility of regular and reserve suppliers estimated in the ar-
tion. According to scientists’ majority Krykavskyi & Chor- ticle. The authors observed that the supply chain perfor-
nopyska [18] and Popovychenko & Cherchata [19], one of mance may deteriorate due to the availability of a flexible
the typical management structures is used to design an source of resources. In practice sole sourcing is typically
enterprise’s organizational structure of logistic manage-
ment: linear, functional, matrix, divisional, etc.
A. CHERCHATA et al. – Innovations in Logistics Management… 11

justified by economies of scale, learning, and trust, de- Hence, the goal of this article is to offer to the experts and
spite its weakness in case of production disruptions. interested users a copyright vision of the approach to de-
Communications between the manufacturer and the re- signing a rational enterprise logistics system in the context
tailer are investigated in such work, as Popadynets et al of improving the organizational structure of this enter-
[27]. The authors made a paradoxical conclusion that a prise as an element of the macrologistical system (or ele-
huge uncertainty of demand can contribute to a reliable ment of the supply chain). The proposed approach, ac-
exchange of information and, surprisingly, can benefit cording to the authors, will allow controlling transparently
both firms. Optimizing the management of multiprofile and regulating the effectiveness and efficiency of the
stocks in the demand uncertainty for each product in each company’s operational and logistical processes based on
period of time, proposed in the article Simkiv et al [28], 4 criteria and a system of quantitative indicators linked to
allows to find a balance between the expected value and these criteria. We assume that such a system of indicators
the corresponding costs variance. In fact, the authors will balance the functional and process directions of the
used simulation, where the resultant indicator is the tar- company’s logistics management and ensure the imple-
get value of storage costs. The strategy of exchanging in- mentation of the organizational, coordinating and inte-
formation with customers on the quantity and qualitative gration role of the company’s logistics service.
composition vertically differentiated products’ stocks in
order to smooth out supply and demand mismatches and METHODOLOGY
to prevent deficits is proposed in article Cui & Shin [29]. To achieve this goal, the following research methods were
One way or another, all above mentioned studies under- used in the work:
stand supply chain management as an open cybernetic − theoretical generalization – for a deeper study of the
system, where suppliers, producers, consumers, as well issue of innovation in logistics (in order to clarify the
as internal and external factors that influence their activi- essence and types of innovation activity, in particular
ties are interconnected and interrelated elements of the in the field of logistics, logistics and process manage-
system. Consequently, many researchers are looking for ment, organizational design)
effective approaches and mechanisms for managing com- − system analysis – for understanding the arrangement
plex cybernetic business systems. And the proposed and operation of the organizational mechanism for the
schemes for stimulating the managers of a large firm formation of the enterprise's logistics system.
through improving the content and linking qualitative and − graphic – for building a process-matrix structure of en-
quantitative indicators of their work allows to analyse the terprise management, taking into account the logistics
management efficiency of certain functional units of the service in it;
company, but to a lesser extent, oriented towards the as- − economic and mathematical method – to build an in-
sessment of business processes and logistics flows man- tegral indicator for calculating the efficiency and effec-
agement Englmaier & Roider [30]. Scientists Astashova et tiveness of a certain operating business process;
al [31] propose a multidimensional approach to supply − statistical analysis - for the collection and analysis of
chain management based on distinguishing between two data from construction companies and the Stock mar-
related management objects: a subsystem of flowing ket infrastructure development agency of Ukraine
business processes and a subsystem of business (SMIDA) [34] to calculate the efficiency and effective-
interaction of chain participants. It will allow to take into ness of the business processes of the studied enter-
account the specifics and complexity of the logistics chain prises.
as an object of management. Fugate et al [32] in their In particular, the financial and management reporting of
work investigate the influence of logistics performance on 15 joint-stock manufacturing enterprises was analyzed.
enterprise performance. The results show the positive The authors analyzed quantitative - absolute and relative
influence of logistics on the efficiency of the organization, indicators of the effectiveness and efficiency of the
while the efficiency and effectiveness are complementary operating activities of enterprises: net income, cost of
indicators. Manlig et al [33] point out that if you do not goods sold and their structure, administrative, general
innovate the business processes of enterprises, you will production, burden (other operating expenses) and sales
not survive. We fully agree with this statement, since high costs, profit from operating activities, profitability of
requirements for the quality of business process control operating activities, and also a number of others,
more and more require the use of auxiliary tools that will including non-financial indicators, characterizing the
allow us to get a detailed analysis of them. operational business processes of the enterprise and their
However, in spite of numerous groundworks, it is left not logistics services.
adequately explored issues of coverage of innovative ap-
proaches in the field of logistic management in the con- RESULTS
text of improving the organizational structure of enter- The efficiency of the logistics industry as a macrologistic
prise management and the creation of an efficient logis- system is formed due to the effective functioning and
tics system with the possibility of quantitative monitoring interaction of all micro-logistic systems, that is, the
of the certain units’ effectiveness and business processes logistics systems of specific enterprises. Since the study
through a system of interconnected criteria and indices examines the organizational mechanism for the formation
which causes the necessity of further deep researches. of an enterprise's logistics system, we believe that the
enterprise's logistics system is part of the country's
 12 Management Systems in Production Engineering 2022, Volume 30, Issue 1

logistics system (industry). Therefore, we consider the Management

micro-logistic systems of the enterprise as an element of

the macrologistic system, that is, the supply chain with all Manufacturing- Financial-economic unit Market unit
technological unit
its external participants and interconnections.
Thus, we believe that an efficient and transparent organi-

transport-procuring functions)
Logistics unit (coordination of

Transport-procuring subdivision

Cost estimation-contract service

the supplying, stocking and

Technical-mechanical subdivision

(Sales and purchases market)

zational mechanism for the formation and operation of

Manufacturing subdivision

Planning-economic division

Marketing division
the company's logistics system as an element of the sup-
ply chain should provide a compromise, but rather a con-
sensus between the vertical and horizontal direction of
this system management. The quality of this mechanism
must be measured through a system of interconnected
relevant indicators. Fig. 1 Principal view of a balanced matrix enterprise's organi-
In other words, it is referred to matrix principle of an en- zational structure
terprise's organizational structure that can be realized
through logistic service implementation, that integrates In order to manage this business-processes modified bal-
all participants of economic process in supply chain on the anced scorecard with its peculiarities taken into account
basis of connection mechanism’s management of the eco- is suggested to use. The idea of balanced scorecard (BSC)
nomic flows. Consequently, the balanced matrix organiza- belonged to Norton and Kaplan [35] found the develop-
tional structure formation could be done (Fig. 1). The no- ment of this indicator system, but operational business
tion “balanced” means: matrix OBS, that divides authority processes of the enterprise, classified in a certain way (see
and real monitoring of some functions (vertical) and busi- above) are the object for estimating and system of indica-
ness-processes (horizontal) fulfilment into 50/50 propor- tors is formed for it. The authors proposed four criteria for
tion between functional fields supervisors and logistic ser- evaluating the identified business processes: Financial-
vice management. Organizational Breakdown Structure economic, manufacturing (resources), external integra-
(OBS) is an organizational structure of performers (organ- tion criterion, organizational. Thus, implementation’s
izations) which is mainly used in project management. logic of logistic service on the enterprise is grounded on
This study proposes the creation of a process-matrix or- the estimation of specific indices of operational business-
ganizational structure, that is, the imposition of process processes in conformity with each accepted criteria. (Fig.
(project) management on the classical (functional) organ- 2). The set of indicators in accordance with a certain crite-
izational structure. It characterizes the structure of man- rion is also tied to a certain functional unit of the enter-
aging the relationship of participants in the implementa- prise. To form the sets of indicators presented in Figure 2,
tion of business processes related to logistics activities. the authors studied quantitative-absolute and relative in-
Regarding to logistics activity of production-economic or- dicators of the effectiveness and efficiency of the operat-
ganization, it is reasonable to consider operational busi- ing activities of the enterprises: net income, cost of sales
ness-processes, i.e. manufacturing business-processes and its structure, administrative, general production,
(engaged with production) and business-processes that overhead (other operating costs), marketing costs, profit
ensure production’s operating (resources supply, from operating activities, profitability of operating activi-
transport supply, storage of material and technical re- ties, and also a number of the others, including non-finan-
sources). cial indicators that characterize the operational business
processes of the enterprise and their logistics good ser-
vice.

Director general

Chief engineer service Marketing subdivision Financial-economic subdivision

(manufacturing function) (external integration function) (financial-economic function)
Manufacturing

processes
business-

Indices Indices Indices

M-mnf M-ei M-fe
(organizational-coordination-integration function)

∑ operational business-processes costs

Resources supply of
manufacturing
Indices M-o; RS-o: SS-o; TS-o

Indices Indices Indices

Logistic service’s chief

RS-mnf RS-ei RS-fe

Storage of material
and technical

Indices Indices
resources

Indices SS-ei SS-fe

SS-mnf
Transport supply

Indices Indices Indices

TS-mnf SS-ei TS-fe

∑ function costs

Fig. 2 A place and a role of the logistic service in a process-matrix enterprise’s organizational structure
A. CHERCHATA et al. – Innovations in Logistics Management… 13

Explanation to the Figure 2: this list is not rigid and may vary depending on the indus-
M-mnf are indices characterised by business-processes of try, competitive position, strategic goals, and the stage of
manufacturing within the framework of production func- the life cycle of a particular enterprise. However, the prin-
tional of the chief engineer service; ciple, system, "matrix", presented above in Fig. 2 pro-
RS-mnf are indices characterised by business-processes of posed by the authors are universal for any production-
manufacturing resources supply within the framework of economic organizations. Thus, the logistic service consists
production functional of the chief engineer service; of four subdivisions according to four highlighted groups
SS-mnf are indices characterised by business-processes of of operational business-processes. It means, that each
material and technical resources storage within the subdivision responsible for coordination and integration
framework of production functional of the chief engineer of certain business-processes’ group. We will demon-
service; strate how the matrix principle of the company's logistics
TS-mnf are indices characterised by business-processes of system functioning, proposed by the authors, works and
transport supply within the framework of production the approach to monitoring, evaluation and regulation of
functional of the chief engineer service; efficiency and effectiveness of the company's operational
M-ei are indices characterised by business-processes of and logistics processes. The above approach, developed
manufacturing within the framework of marketing subdi- on the basis of the proposed criteria and indicators of
vision’s external integration functional; evaluation of efficiency and effectiveness of operational
RS-ei are indices characterised by business-processes of business processes of the enterprise, is based on the com-
manufacturing resources supply within the framework of plex application of methods of strategic analysis. The
marketing subdivision’s external integration functional; methods of strategic analysis allows to define a condition
SS-mnf are indices characterised by business-processes of of both certain operational business processes, and their
material and technical resources storage within the totality by definition of weighted average (IjBSC) as part of
framework of marketing subdivision’s external integra- criteria BSC, Integral (Іbp) and summary (Іj) indicators of ef-
tion functional; ficiency and effectiveness of operational business pro-
TS-ei are indices characterised by business-processes of cesses. It creates a basis for substantiation of administra-
transport supply within the framework of marketing sub- tive decisions on improvement of activity of the enter-
division’s external integration functional; prise for logistics of problem business processes.
M-fe are indices characterised by business-processes of The weighted average performance and efficiency indica-
manufacturing within the framework of financial-eco- tor of a certain operational business process (IjBSC) within
nomic functional of financial-economic subdivision; the BSC criteria is proposed to be calculated by a formula:
RS-fe are indices characterised by business-processes of 𝐼𝑗𝐵𝑆𝐶 = ∑𝑛𝑖=1 𝐾𝑖 × 𝑤𝑖 (1)
manufacturing within the framework of financial-eco- where:
nomic functional of financial-economic subdivision; Kі is the normalized evaluation i-th indicator of the effi-
SS-fe are indices characterised by business-processes of ciency and effectiveness of the operational business pro-
manufacturing within the framework of financial-eco- cess, calculated on the basis of the definition of deviations
nomic functional of financial-economic subdivision; "plan-fact" values within certain BSC criteria;
TS-fe are indices characterised by business-processes of wі – is the weighting factor of the indicator;
manufacturing within the framework of financial-eco- n – number of indicators.
nomic functional of financial-economic subdivision; The integrated indicator of efficiency and effectiveness of
M-o – indicators characterizing the production business a certain operating business process (Іbp) as a whole is a
processes within the organizational-coordination-integra- sum of weighted average indicators of efficiency and ef-
tion functionality of the logistics service; fectiveness of a certain operating business process within
RS-o – indicators characterizing the business processes of the selected BSC criteria and is calculated by the formula:
resource support of production within the organizational- 𝐼𝐵𝑃 = ∑𝑛𝑗=1 𝐼𝑗𝐵𝑆𝐶 (2)
coordination-integration functional of the logistics ser- where:
vice; k – is the number of business processes being investi-
SS-o – indicators characterizing the business processes of gated.
storage of material and technical resources within the or- After calculating the value of the generalizing index of the
ganizational-coordination and integration functionality of set of operational business processes of enterprise Іj, the
the logistics service; level of the state of the system (aggregate) of these pro-
TS-o – indicators characterizing the business processes of cesses of the enterprise on the known Harrington scale
transport support within the organizational-coordination- with the interpretation presented in Table 1 is deter-
integration functionality of the logistics service. mined.
Detailed consideration of a specific list of indices with
their physical content and formulas for calculation is be-
yond the scope of this article, but it should be noted that
 14 Management Systems in Production Engineering 2022, Volume 30, Issue 1

Table 1 So, the interpretation of the generalizing indicator of effi-

The scale of the final assessment of the level ciency and effectiveness of operational business pro-
of the system (aggregate) of operational business processes cesses of the enterprise is proposed to be performed us-
of the enterprise
ing the Harrington scale: Satisfactory: 0.37 < Ij < 0.63;
Numerical
Good: 0.63 < Ij < 0.8; Very good: 0.8 < Ij < 1; Ill: 0.2 < Ij <
intervals
of values 0.37. Very ill: 0 < Ij < 0.2.
Assessment Thus it is important to carry out the analysis of change of
of complex
of the level this generalizing indicator of efficiency and efficiency of
integral indi-
of the system Actions in relation
cator of sys- investigated business processes in dynamics that will al-
(aggregate) to the system (aggregate)
tem (aggre- low to formulate reasonable conclusions about factors
of operational of operational business
gate) and administrative actions which influence operational
business pro- processes of the enterprise
of opera- activity of the enterprise and trajectory of its develop-
cesses of the
tional busi- ment.
enterprise
ness pro-
Thus, the calculated indicators of efficiency and effective-
cesses of the
enterprise, Іj ness of separate business processes and aggregate (sys-
0.8-1.0 Very high level of The system functions effi- tem) of these business processes as a whole allow to re-
efficiency and ef- ciently and effectively, but it ceive and aggregate data on degree of achievement of the
fectiveness is necessary to develop pre- purposes as separate operational business processes, and
ventive actions, if Іj = 1, the the synergetic purposes of set of these business pro-
system does not require de- cesses, on satisfaction of interested parties. The infor-
velopment of any actions mation on efficiency and effectiveness of business process
0.63-0.8 High level of effi- The system generally functions performance is the basis for analysis of the system by the
ciency and effec- efficiently and effectively, but management, it is used for operational control of pro-
tiveness certain corrective actions need
cesses, periodic review of procedures, policies, goals and
to be developed
0.37-0.63 Average level of The system is functioning satis-
improvement of enterprise activity.
efficiency and factorily, goals and objectives Let's give a concrete example of definition of indicators of
effectiveness have been partially achieved, efficiency and efficiency of business processes, namely –
but certain urgent corrective processes of storage of material and technical resources
actions need to be developed. (SS) in connection with 4 criteria (functions) specified by
0.2-0.37 Low level of effi- The system is functioning inef- the authors in Table 2.
ciency and ef- fectively and inefficiently, Similar tables with concrete indicators within the frame-
fectiveness which requires the develop- work of 4 criteria are formed for other groups of business
ment of significant large-scale
processes of the enterprise – production, resource supply,
actions aimed at correcting its
transport support after which the generalizing indicator of
condition
0.0-0.2 Very low level The system is functioning inef- a set of operational business processes of the enterprise
of efficiency fectively and inefficiently, goals is calculated (Ij).
and effective- and objectives have not been On the basis of interpretation of values of integral indica-
ness achieved, influential anti-crisis tors of efficiency and effectiveness of certain operational
actions from the top manage- business processes (Іbp) on the offered scale the estima-
ment are needed. If Іj = 0, it is tion of their condition for definition of problem business
necessary to radically redesign processes is carried out (Table 3).
the set of operational business On the basis of Table 3, it is possible to justify the priority
processes.
of management actions to improve certain business pro-
cesses based on the rankings. For example, first of all re-
After calculation of values of indicators of business pro-
quires attention to the business process of "resource sup-
cesses the level of their efficiency and effectiveness ac-
ply of production", because it received the lowest rating.
cording to the resulted scale is identified, and also actions
"Bottlenecks" in the middle of investigated business pro-
in relation to the certain business process and in aggre-
cesses are identified on the basis of values of weighted
gate (system) of operational business processes of the en-
average indicators of efficiency and effectiveness of cer-
terprise as a whole are offered.
tain business process (IJBSC).
A. CHERCHATA et al. – Innovations in Logistics Management… 15

Table 2
Definition of effectiveness and efficiency indicators of business processes for storage of material and technical resources (SS)
Formula
Name Indicator Note
Actual value Planned value for calculating
of effectiveness Value, Kі weighting (change dynamics
of the indicator of the indicator the relative unit
and efficiency indicators factor, wi characteristic)
indicator, Kі
1. Financial and economic criterion (FE)
Share of inventories Fact > Plan → «bad»
0.39 0.1 SS1 =Plan/Fact 0.21
in current assets (SS1) 0.26
Share of storage costs
0.35 0.05 SS2 =Plan/Fact 0.14 0.14 Fact > Plan → «bad»
in total costs (SS2)
Total liquidity ratio (SS3) 1.73 1.5 SS3 =1-(Plan/Fact) 0.13 0.09 Fact > Plan → «good»
Stock turnover ratio (SS4) 12.1 8.9 SS4 =1-(Plan/Fact) 0.26 0.12 Fact > Plan → «good»
Profitability on Stock (SS5) 0.85 1 SS5 = Fact/Plan 0.85 0.10 Fact < Plan → «bad»
ІSSfe =∑(Kі·wi) = 0.2
2. Production (resource) criterion (MNF)
Material integrity during
storage, % (amount
of spoiled material/vol- 4 5 SS6 =1-( Fact/Plan) 0.2 0.09 Fact < Plan → «good»
ume of material in stor-
age) · 100 (SS6)
Load level of warehouse
space (area actually
85 100 SS7 = Fact/Plan 0.85 0.12 Fact < Plan → «bad»
used/total warehouse
area) (SS7)
ІSSmnf =∑(Kі·wi) = 0.12
3. External integration criterion (EI)
Costs of maintaining stocks held in hired
1000 700 SS8 =Plan/Fact 0.7 0.06 Fact > Plan → «bad»
warehouses (SS8)
ІSSeі =∑(Kі·wi) = 0.04
4. Organizational criterion (О)
Unevenness coefficient of warehouse opera-
0,85 1 SS9 = Fact/Plan 0.85 0.05 Fact < Plan → «bad»
tion (SS9)
ІSSо =∑(Kі*wi) = 0.043
ІSS = ІSSfe+ ІSSmnf+ ІSSeі+ІSSо = 0.2+0.12+0.04+0.043 = 0.4

Table 3
Results of evaluation of efficiency and effectiveness of business processes performance of the enterprise under study
Name of business Interpretation of business process efficiency
Meaning Rang Numerical value intervals Іbp
process and effectiveness assessment
1) Production 0.49 III
2) storage of material 0.40 II
and technical resources 0.37-0.63 Satisfactorily
3) transportation 0.51 IV
of production
4) resource support 0.32 I 0.2-0.37 III
of production
Generalized indicator of the aggregate of operational business processes
of the enterprise as a whole Satisfactorily
Іj = 0.43

Hereby, functions of vertical structural subdivisions (chief So, it is possible operational business-processes’ effi-
engineer service is manufacturing function, marketing di- ciency indices to track, estimate and control clearly. Be-
vision is external integration functional, financial-eco- sides, responsible employees for this indices’ status are
nomic division is financial-economic functional) became identified strictly with both vertical and horizontal. It
identificated. makes possible cross costs monitoring under business-
Horizontal direction of management (organizational-coor- processes and enterprise's functional structural subdivi-
dination-integration function) is provided by logistic ser- sions.
vice, which subdivisions is responsible for coordination Thus, proposed BSC indices are “connected” to aims and
and integration of enterprise's operational business-pro- tasks of certain subdivisions and employees that involved
cesses. into certain business-processes. Enterprise's logistic man-
agement estimates and controls indices status.
 16 Management Systems in Production Engineering 2022, Volume 30, Issue 1

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Anzhela Cherchata Viktoriia Gryn

ORCID ID: 0000-0002-6753-2891 ORCID ID: 0000-0002-6758-7374
Prydniprovska State Academy Zaporizhzhya National University
of Civil Engineering and Architecture Accounting and Taxation Department
Department of Management, Zhykovsky str. 66, Zaporizhzhya, Ukraine
Project Management and Logistics e-mail: [email protected]
24a, Chernyshevsky Street,
Dnepropetrovsk, 49600, Ukraine Nadiia Shevchenko
e-mail: [email protected] ORCID ID: 0000-0001-8131-5757
Odessa State University of Internal Affairs
Iryna Popovychenko Kherson Faculty
ORCID ID: 0000-0003-3443-9356 Department of Administrative Law
Prydniprovska State Academy and Administrative Procedure
of Civil Engineering and Architecture Uspenskaya str. 1, 65014, Odesa, Ukraine
Department of Economics and Entrepreneurship e-mail: [email protected]
24, Chernyshevsky Street,
Dnepropetrovsk, 49600, Ukraine Oleksandr Shkuropatskyi
ORCID ID: 0000-0002-4679-7292
Uliana Andrusiv Yaroslav Mudryi National Law University
ORCID ID: 0000-0003-1793-0936 Military Law Institute
Ivano-Frankivsk National Technical University Oil and Gas Department of National Security and Legal Work Law
Department of Theory of Economics and Management Pushkinskaya str., 77 61024 Kharkiv, Ukraine
Karpatska St., 15, 76019, Ivano-Frankivsk, Ukraine e-mail: [email protected]
e-mail: [email protected]