On Intra-Group Allocative Efficiency of Resources in Industrial Business Models

Abstract

The main reason for the creation of industrial firms with complex hierarchies is the transaction and optimization of resources, and the scaling of specific investments. The allocative efficiency of the resource portfolio determines the or-ganizational and economic results of the industrial business models cooperation. The article is devoted to modeling the impact of intra-group allocation of produc-tion assets on the revenue and profitability of sales for group of industrial enter-prises. We also construct scenarios for optimizing its resource portfolio. The me-thodologically study is based on neo-institutional economic theories (contract theory, the agency problem theory) and the macroeconomic analysis. The methods are econometric and scenario modeling. The information base of the study was da-ta on economic activity for eight enterprises from UMK-Steel LTD of the multi-functional holding «Ural Mining and Metallurgical Company». We select a re-gression analysis toolkit that allows for a comprehensive and relevant measure-ment of the impact of various types of resources on the efficiency in the group of industrial enterprises. The results of empirical testing revealed the relationship be-tween the structure of fixed assets, as well as labor resources, and the indicators of revenue and profitability of sales in UMK-Steel LTD. The distribution of material resources between the enterprises of the group has practically no effect on its per-formance indicators. Further, we identify the base scenario for allocation of the resource portfolio. The proposed methodology contributes to the development of approaches to the system analysis of intragroup allocative efficiency in complex hierarchical industrial business models.