How to ensure balanced development of big transforming economic organizations?
Transformation processes differ depending on the political, economic and cultural environment. Different countries have chosen opposite approaches to this process. China focused on gradual, state-led and highly effective transformation, while Ukraine and Russia chose to omit several of the transformation phases, entered the path of rapid changes, and were not able not avoid many mistakes.
Chair: Professor Stanisław Speczik, President, KGHM Polska Miedź S.A.
Speakers:
-Miao Gengshu, Senator; President, China Minmetals Group
-Dr Oleh Soskin, Director, Institute of Society Transformation, Ukraine; advisor to President Kuczma
- Prof. Wang Yiming, Vice-President, Academy of Macroeconomics at the State Commission for Development and Reforms
-Prof. Evgeny Kchlybov
Professor Speczik described the phases of the transformation of a large state company using the example of KGHM Polska Miedź. Although this transformation can be considered a success, a few mistakes were made in the process. Some of the factors limiting growth and worsening the transformation balance include: unfavourable group work agreements, unprepared transactions of daughter companies sales, political decisions, and the "second leg" concept (diversification and creation of the second key business unit).
Mr. Gengshu emphasized the role of the macroeconomic environment in transformation, in particular the role of the political and economic situation. In his opinion, transformation in China forced:
1. designing new strategy
2. constant improvement of the management and management systems
3. gradual introduction of changes
4. creation of a "healthy" corporate culture, preventing the disadvantageous influence of changes on the human resources
According to Mr. Soskin, rapid introduction and development of the market economy in Ukraine, as well as the privatization of state enterprises led to the creation of politically rooted, private capital groups. They aim at maximizing short-term profits, bringing losses to the country and impairing the economic development.
Mr. Wang Yiming pointed out that the Chinese economy requires changes in almost every area; therefore the leaders of the transromation should be the largest companies, experiences of which would allow for gradual shift of the smaller firms into the market economy. The major problem of this model is the inadequacy of the internal management systems for such economy.
