The role of self-financing in introducing innovative development in construction organizations
Journal Title: Visnyk Ternopilskoho natsionalnoho ekonomichnoho universytetu - Year 2018, Vol 1, Issue
Abstract
The article discusses and defines the concept of self-financing which unlike statutory reserves is not necessarily displayed in a balance sheet and may take different forms of investment. It is pointed out that one of the main principles of generating investment resources of an organization is the principle of correspondence between attracted investment resources and investments needed, which is based on calculations of the total of real and financial investments. It was found that the problem of financial and credit support of innovative development through self-financing relates to the portfolio allocation model of scarce investments between the elements of organization. Such an approach results in a situation in which some innovative projects receive insufficient investment resources. The concept called “routinization of innovation” is considered as a stage of the innovation process which is characterized by the accumulation of constantly reproduced traditions. The savings achieved through this should be spent on the routine of innovation. The possibilities of using self-financing are examined. It is viewed as the main tool for introducing innovative development in building organizations under current conditions. Reasons for lack of effectiveness of this tool are described. The methodology for calculating the range within which self-financing is considered to be reasonable is presented. It is proved that in order to facilitate the effective operation of an organization, given the process and structure of self-financing, its innovative adaptation should reflect the ability to perform all the functions (including the logistics of resources) arising from innovative development of the organization.
Authors and Affiliations
Stepan Karabanyk, Yuliia Mykytiuk
Keywords
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