Nonlinearity and Stability of an Industrial Enterprise in the

Information Analysis of Management

Sergey Vitalievich Chuprov

Baikal State University, Irkutsk, Russia

Keywords: Information, non-linearity, management, stability, chaos, effect, economic system.

Abstract: The development of theoretical views, methodological and applied tools of sustainability management of

industrial enterprises is now a priority among the urgent economic tasks for managers of industrial enterprises

and the business community. Within the framework of ensuring reliable competitive positions of enterprises

and their successful innovative modernization, professional analytics focuses on the conditions and features

of the functioning of enterprises that are affected by growing globalization and the crisis of the world and

domestic economy. The perturbed modes of behavior generated by them and their own triggers demonstrate

features of nonlinearity with their inherent restructuring, oscillation, loss and gain of stability. The study goal

is to use the insights of system analysis, cybernetics, nonlinear dynamics, catastrophe theory and information

to analyze and interpret the metamorphosis that industrial enterprises undergo. In view of this, the article

presents an economic explanation of scenarios for the transformation of industrial enterprise and the linking

of its evolution with the amount of information, entered by the management system and materialized in the

means of enterprise production. At the same time, for information analysis, a significant analytical aid is the

modification of exponential dependence of the disordered functioning of enterprises controlled complex, the

amount of accumulated control information and the enterprise economic effect (according to V. Trapeznikov),

which makes it possible to introduce into this dependence the indicator of management excellence level

achieved at industrial enterprise and assess the impact of the latter on the amount of information inherent in

it. In the conditions of incompleteness of the initial information, the task of using and processing both

quantitative and poorly formalized qualitative information is actualized due to the use of the fuzzy sets

apparatus. The study significance is to enrich the concept, technology and algorithms of adaptive management

of an industrial enterprise in a highly perturbed and knowledge-intensive business environment.

1 INTRODUCTION

The era of rapid and intense changes in the political

and social space dynamizes the environment of

regional and corporate economic systems, subjecting

their structure and functioning to increasing

perturbation and the risk of weakening the

competitiveness and degradation of industrial

enterprise resources. In view of this, traditional

approaches to the design of its management and

sustainability management of the enterprise in a

stationary environment retreat to the time demands,

need theoretical and methodological verification and

revision, taking into account the postulates of both

social and natural science branches of knowledge.

And the information analysis of the nature of their

restructuring and tools to ensure the vitality of

industrial enterprises in a vortex environment with a

sequence of stable and unstable states acquires

priority importance in understanding the evolution of

developing economic systems.

Currently, studies on the sustainability of

economic systems go back to both the classical

concepts of fundamental property of dynamic

systems (Chuprov, 2016) and expand the range of

analytical works on the problems of ensuring the

sustainability of innovative development in an

uncertain and dynamic external environment

(Khudyakova, Shmidt, 2018) and the formation of a

new technological order of economic structures

(Alekseeva, Babkin, Makhmudova, Yung, 2020). In

this context, we have recently seen a surge of interest

in the modernization of management technologies for

making management decisions based on the use of

intellectualization of the search for solutions

(Veretyokhin, Yachmeneva, Sevastyanova,

Chuprov, S.

Nonlinearity and Stability of an Industrial Enterprise in the Information Analysis of Management.

DOI: 10.5220/0010698700003169

In Proceedings of the International Scientiﬁc-Practical Conference "Ensuring the Stability and Security of Socio-Economic Systems: Overcoming the Threats of the Crisis Space" (SES 2021),

pages 281-285

ISBN: 978-989-758-546-3

281

Osmanova, Yachmenev, 2020) and digital platforms

(Belyakova, Belyakov, Fokina, Shpak, 2020;

Gribanov, Bezrukova, 2018).

In order to develop the stability management of

nonlinear functioning of industrial enterprises, the

task is to ensure the use of poorly formalized source

information and algorithms of fuzzy sets in

management technology, which opens up the

possibility of saturating it with valuable knowledge

about the properties of enterprise behavior in the face

of increasing threats. As a result, it is possible to

increase the information transparency of decision-

making environment and the adaptability of industrial

enterprise by responding to emerging risks in advance

by maneuvering its resources.

2 MATERIALS AND METHODS

In the range of natural-scientific and economic views

on the stability of motion of dynamic systems, the

achievement of study goal is achieved by attracting

the ideas of systems analysis, cybernetics, nonlinear

dynamics, catastrophe theory and information theory.

Thanks to application in the complex of these

concepts and methodological principles, it becomes

possible to perform an information analysis of

metamorphosis of nonlinear activity of an industrial

enterprise, the bizarre combinations of stable and

unstable phases of its functioning.

3 RESULTS AND DISCUSSION

Conceptually, it became undeniable that with the

“jump into the market” on the transformation of

domestic enterprises was extremely powerful

pressure of overwhelming economic dynamics,

coming from the reformers' plan of rapid

denationalization and privatization of the property of

economic complexes. Obviously, the orthodoxy of

monetarism left no other levers to manage the

transition processes except free pricing and money

supply regulation, which against the background of

radicalization of institutional change caused an

unprecedented steepness of the processes caused by

them.

Chaotization of the economic space has become

an inevitable consequence not only of structural

discontinuities, among which the network irregularity

of input and output commodity flows and interactions

with counterparties, but also of the confusion with the

economic activity rules.

Meanwhile, it is theoretically argued and

practically confirmed that in a highly disturbed

environment, replete with critical overloads and

burdened by the lack of effective government

support, the work of industrial enterprises was

shackled by fading or arrhythmia of supply of

consumed resources (raw materials, materials,

energy, products, etc.), a shortage of their own

financial funds, uncertainty of partnerships, demand

for manufactured products and their supply. The

undermined reproduction of the enterprises' resources

resulted in the containment, or even the damping of

business activity, a sharp drop in output and sales, the

exorbitant growth of debts and the risk of bankruptcy.

The commodity-money imbalance and turbulence

of the transitive Russian economy gave rise to critical

transition processes and, with the liberalization of

pricing, inflationary waves running over each other

and the entrenchment of depressive tendencies.

Shocks of supply and demand, as a reaction to the

shocks of the country's deformed economic complex,

rocked its financial and economic mechanism and

condemned enterprises to exhaustion and depletion of

resources. Within the framework of monetarism

postulates, which ignored the methods of state

regulation, there was no need to rely on the damping

and repayment of the prohibitive “bursts” of inflation

(Chuprov, 2017).

The dynamic picture of the enterprise functioning

is undergoing restructuring, closing the slow and fast,

smooth and “explosive” phases of behavior. In

particular, during the evolution of enterprise, its state

of stable equilibrium may merge with an unstable

equilibrium, after which the equilibrium disappears

and the enterprise economic system radically changes

mode, making a leap (a “catastrophe” occurs).

Phenomena of this kind are studied and described

by catastrophe theory, in which a dynamic system

loses stability of an equilibrium state due to both

bifurcation of this state and a spontaneous process

(Arnold, 1990). Moreover, with the loss of

equilibrium state, the system either moves to another

equilibrium, or two such states appear: stable and

unstable equilibrium.

It would appear that this scenario of industrial

enterprise's transformation is inherent in the first

stage of its slide into crisis, when under the influence

of perturbations, the enterprise is gradually

“squeezed” out of a stable equilibrium and over time

it weakens and disappears. After that, the perturbed

mode of enterprise's functioning evolves to another

equilibrium state, different from the previous

equilibrium. The enterprise is drawn into the process

of disintegration and deterioration of resource

SES 2021 - INTERNATIONAL SCIENTIFIC-PRACTICAL CONFERENCE "ENSURING THE STABILITY AND SECURITY OF

SOCIO - ECONOMIC SYSTEMS: OVERCOMING THE THREATS OF THE CRISIS SPACE"

282

balance, and because of decline in the efficiency of

their use, the enterprise's business activity falls. With

acquisition of new state of equilibrium, it can become

stable, if it is unshakeable to the perturbations

rendered, or unstable, easily disturbed by them in the

chaotic activities of the enterprise.

Meanwhile, another scenario is real, in which a

stable state of equilibrium in an industrial enterprise

dies out, in which it degenerates into a limit cycle, and

then the equilibrium becomes unstable. With the

emergence of an oscillating periodic regime, the

transition process reflects the unfolding of crisis in

passing, which unfolds as the cyclical reproduction of

enterprise resources suffers. In fact, this refers to the

unstable operation of the enterprise, which is

characteristic in a disturbed environment, which

proceeds in an excited mode, which differs little from

the equilibrium one with a slight deviation of mode

from the point of loss of stable equilibrium (Chuprov,

2016).

Quite a typical case is when the loss of stable

equilibrium of an industrial enterprise passes quickly

enough and the loss in the equilibrium position of

limit cycle is accompanied by disappearance of the

latter, after which the equilibrium becomes unstable.

Before that, the random disturbances acting on the

enterprise's activity force the enterprise system to

leave the attraction area of the previously established

regime, the intensity of its financial and economic

activity changes dramatically and the enterprise

jumps into a qualitatively different regime. After such

a violent metamorphosis, the enterprise, by

catastrophe theory, is drawn to a new stable stationary

mode or submits to a stable fluctuation or even more

complex motion (Arnold, 1990).

Meanwhile, restructuring in a chaotic economic

system is characterized by change in the orderliness

of its behavior, organically related to the amount of

information contained in the system. In the process of

non-ordinary transformations, it is distinguished in

the process of evolution by value of entropy as a

measure of energy dissipation in terms of

thermodynamics and statistical physics. In

information analysis, V. Trapeznikov's concept Is

valuable, according to which there is an exponential

dependence of the effect of system functioning on the

disorder of its behavior and the amount of control

information in it (Trapeznikov, 1983):

eBE=E ]1[

max



(1)

where

– the effect of functioning complex;

max

– the effect of perfectly

functioning complex (maximum possible effect);

– complex disorder in an initial state;

– the amount of information that is specific

to this control object;

- the amount of control information.

Simple mathematical operations allow us to

modify equality (1) and obtain the following

expression regarding the amount of information in the

economic system:

)

(I=I

max



(2)

Ratio

maxE

B. Trapeznikov called the level

of management excellence. Its value is determined by

the amount of information input into the system and

its usefulness, depending on perfection of devices and

software for collecting, processing and influencing

the control information on the system. From the

equations (1) - (2) for information analysis, find the

basis for the statement: with a given disordered

behavior of the system and its saturation with useful

information, the effect of system functioning

increases, but with the approach to its maximum

value, the increase in the effect exponentially

decreases.

From the perspective of information paradigm,

the stability management system of industrial

enterprises relies on a wide application of

professional knowledge, algorithms for finding and

maintaining a sustainable mode of the enterprise in a

highly perturbed environment and the scarcity of

available information about it. The technology

structure of such adaptive management includes the

blocks of forecasting changes in the external

environment, adapting the management system,

forming the production plan and simulating its

implementation, assessment and analysis of

enterprise stability on the forecasted background,

their diagnosis, correction of planning conditions and

ensuring the implementation of industrial production

plan.

The use of heuristic models built on the basis of

algorithms of fuzzy sets theory makes it possible to

enter and process both quantitative and poorly

formalized qualitative information, which better

meets the peculiarities of analysts' thinking and

tradition to operate with fuzzy categories. Innovative

support for adaptive management and sustainability

Nonlinearity and Stability of an Industrial Enterprise in the Information Analysis of Management

283

management of industrial enterprises is carried out

through analytical functions and intellectualization of

participants in computer dialogue, and, above all,

their ability to perceive poorly structured problems

and exchange heuristic information, which facilitates

the generation of new knowledge about the properties

of enterprise sustainability.

Thus, the objectivization of picture of its behavior

logically leads to the need to develop information

analysis of the industrial enterprises' functioning,

which corresponds to the condition of their innovative

development. At the same time, the use of ideas about

bifurcations and catastrophes in nonlinear processes

brings us closer to understanding the essence of

abrupt changes in the economy, when the measured

course of the process under influence of small

perturbations is replaced by rapid and loses its

previous stability. It seems that the transfer of

knowledge with its embodiment in technology,

means and products of labor can both strengthen the

stable mode of enterprises' operation, and under

certain conditions lead it into the area of future

bifurcations.

In the current highly indignant and uncertain

economic situation, it is advisable to talk not only

about the development of adaptive management

technology for the sustainability of industrial

enterprises, but also about the fact that it has an

“innate” ability to innovative modernization and

build up “skills” action of permissible external and

internal interference. It should have the property of

active self-learning with the priority on extraction and

mastering of new knowledge in the professional skill

of enterprise personnel, production and computer

technology management.

In short, saturation in such a “foggy” risk

environment of enterprise operation with knowledge-

intensive information and its materialization in

management and production activities will (at least

partially) weaken the emerging chaotic processes in

its functioning and make up for its lack for effective

development. Otherwise, the non-equilibrium

behavior of the enterprise may become stable, but not

due to the innovative type of progressive

transformation, but under the influence of the

dominance of degradation tendencies. And then,

when the bifurcation points are reached, the trajectory

of the enterprise will be poorly predictable and will

be determined by the conditions of transition process.

Therefore, in the course of computer experiments, it

is necessary to assess the enterprise's adaptability and

the effectiveness of implemented solutions, which

deepens the knowledge of nature and patterns of crisis

processes, and therefore contributes to the acquisition

of personnel skills in diagnosing and managing the

stability of an industrial enterprise.

4 CONCLUSIONS

In conclusion we summarize that the development of

methodology, technology and tools of modern

management of industrial enterprise allows not only

to comprehend the metamorphosis of its nonlinear

behavior, economic evolution and anti-crisis

management of the enterprise, but also to achieve in

practice to maintain its stability, through the design

and implementation of information and algorithmic

developed management system.

Achieving and maintaining sustainable operations

of an industrial enterprise in a highly perturbed

environment is supported by the development of

intellectualization tools that open up the possibility of

applying poorly structured qualitative information in

management models, making up for its

incompleteness in a dynamic and poorly defined

environment.

The prospects for further research on the

discussed problems are associated with the functional

development of adaptive management technology,

which will ensure the strengthening of the

competitive position of industrial enterprises in the

globalization of world economic relations, the

establishment and expansion of innovation economy

sectors.

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