Actual problems of innovative economy and law

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Production potential of the enterprise as an economic category

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УДК: 658.5:338.432

DOI: https://doi.org/10.36887/2524-0455-2024-2-14

Krasnorutskyy Oleksiy,
Doctor of Economics, Professor, Acting Director,
Livestock Farming Institute of National Academy of Agrarian Sciences of Ukraine,
https://orcid.org/0000-0003-1744-3257
Marenych Tetiana,
Doctor of Economics, Professor, Chief Researcher of the Department of Economics, Management and Innovation Transfer,
Livestock Farming Institute of National Academy of Agrarian Sciences of Ukraine,
http://orcid.org/0000-0003-3162-7394
Prusova Halyna,
Candidate of Agricultural Sciences, Senior Researcher, Head of the Testing Center,
Livestock Farming Institute of National Academy of Agrarian Sciences of Ukraine,
https://orcid.org/0000-0002-2604-5720

The article presents the research results substantiating the definition of “production potential of the enterprise” and identifying its constituent elements based on the study of existing scientific views. The analysis of modern literary sources demonstrated a relatively wide range of views on the essence of production potential and theoretical and methodological contradictions. It was found that many scientists interpret it as economic, resource potential, or enterprise potential. There needs to be a particular understanding of the components of production potential and the factors that affect it, which complicates the development of methods for its quantitative and qualitative assessment, analysis of use, and increase. The presence of numerous discussions of leading scientists related to the concept of potential, its structure, and classification of resources necessitated further detailed research and disclosure of the category “production potential of the enterprise”. It was found that the interpretations of the concept of “potential” given in the dictionaries reflect the diversity of approaches humanity has accumulated in interpreting and applying this term in various fields. At the same time, as a rule, there is no emphasis on the possibility and expediency of applying this or that disclosure of the essence of the concept of “potential” specifically in the economy. The following are defined as the main factors that influence the amount of production potential: availability of resources, their quality, structure and functional relationship, rational use, technology, technological process, organization of production, knowledge, and entrepreneurial abilities. It is justified that, in the most general sense, the elements of production potential include land and other natural resources, means of production (tools and objects of work), labor force, technology and organization of production, professional knowledge and abilities of management personnel and other participants in the production process, and management. It was concluded that only through the involvement of all components of the production potential does the production of products, works, and services available to consumers for use become possible. The systematic approach made it possible to give the following author’s definition of the critical economic category of the study: the production potential of an enterprise is the ability of an enterprise to carry out a production process with the maximum possible aggregate result of the use of resources of a certain quantity and quality and functional ratio in such activity based on the appropriate technology and organization of production, knowledge, and abilities of management personnel and other participants in the production process. Depending on the completeness and degree of rationality of the use of input resources and other components, we can talk about the enterprise’s fundamental (accumulated), current, and strategic (future) production potential.

Keywords: potential, enterprise potential, production potential, economic potential, resource potential, resources, efficiency, management.

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The article was received 06.03.2024