Academic journal article Economics & Sociology

Dairy Industry in Ukraine: Evaluation of Business Efficiency

Academic journal article Economics & Sociology

Dairy Industry in Ukraine: Evaluation of Business Efficiency

Article excerpt

ABSTRACT. The paper considers the problem of maintaining priority development of mill; processing plants, emphasizing great importance of the formation of evaluation system. The overview of scientific approaches to the definition of the operation of enterprises is done. The importance of the distinction between the effectiveness and efficiency is substantiated. The evaluation of performance on key indicators is developed regarding the main activities of milk processing enterprises in Ukraine, requirements and standards. The areas of company's management to operate successfully under the market conditions are identified.

Keywords: dairy industry of Ukraine, performance, effectiveness, efficiency, synergistic effect.

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Introduction

The transition of the economy of Ukraine to market relations has led to significant changes in the enterprises activity as a whole. Significant growth in the economy, the dynamics of the external and internal environment requires enterprise transformation at both levels. Ukrainian economic crisis that has affected all sectors of the economy has also affected dairy industry. Dairy industry plays an important role in the economy of any country providing the population with food essentials. Milk and dairy products contain almost all the necessary substances for the human body. They are essential for ensuring public health and balancing diet, as well as for the food market. Therefore milk and milk products are of the huge importance in the diet consumption in Ukraine and the products of social value.

Thus, the operation of dairy enterprises in today's economic development needs deeper reform to improve its efficiency and effectiveness. Attention is drawn to the fact that in the economic literature the studies of performance indicator are done at a theoretical and practical level. However, in modem terms, we would consider other, equally important indicator of success of the company, - its effectiveness. This parameter allows achieving high dynamism of economic growth. Evaluation of the performance of the enterprise is a key element of management and support for business decisions. The experience of the most successful companies shows that the precondition of success of any company is setting the right goals and their performance at the lowest cost of resources.

Efficiency as a part of effectiveness

In Ukraine the level of researches of the concept of "effectiveness", unfortunately, lags behind foreign developments since the term is often equated with the term "efficiency". In our opinion, this is an important and urgent problem. It should be noted that despite the increased attention to the problem of identification and evaluation of the effectiveness and efficiency at all levels of the economy, there is no clear interpretation of the essence of these concepts in the economic literature. Mix the concept of outcome and effectiveness, efficiency and impact and effectiveness and efficiency. Since 80-90s of the twentieth century the situation has changed dramatically, and in specialized scientific publications, many scientists prefer to use the term "effectiveness" (Oleksiuk, 2008, p. 132).

In our opinion, the results of the enterprise activity, effectiveness - is an economic category, which includes a set of interrelated parameters that characterize the company from a position of accuracy of the tasks and the efficient use of resources. The accuracy of correct tasks setting is understood as results that satisfy the needs of owners, their employees and consumers. Thus, we define the efficiency as an integral part of effectiveness. The effectiveness in this concept involves comparing the results with the value of the spent resources, acts as a relation between resources and results of economic activity, and is of a technical nature. The company can be efficient but not effective. …

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