Slovak Enterprises Research Articles

ESG scoring and financial performance in micro and small enterprises

This paper investigates the influence of Environmental, Social, and Governance (ESG) principles on corporate financial management within micro- and small enterprises. The primary objective is to assess the impact of ESG integration on the financial performance of these firms. The study commences with a comprehensive review of ESG reporting, underscoring its significance in evaluating corporate performance and ensuring long-term sustainability. A mixed-method approach, incorporating both quantitative and qualitative analyses, is employed to examine data from 200 Slovak companies across various industries. The study explores the correlation between ESG assessments and financial metrics, including Return on Assets (ROA) and Return on Sales (ROS). The results indicate an ambiguous relationship between ESG scores and financial performance, implying that while ESG adoption is vital for sustainability, its short-term financial advantages may be limited. Additionally, the paper addresses the challenges encountered by Slovak enterprises in ESG reporting, such as insufficient awareness and the perceived financial burden of compliance. Recommendations include broadening the dataset and extending the temporal scope of the analysis for more robust insights. The paper also advocates for heightened awareness of ESG principles through educational programs and the enforcement of EU regulations on ESG reporting. These findings aim to contribute both to academic discourse and the practical application of ESG principles, thereby fostering sustainable business practices in Slovakia.

Internal Barriers of Family Business: A Survey in Wood-Working and Furniture Family Enterprises in Slovakia before and During the COVID-19 Pandemic

Internal Barriers of Family Business: A Survey in Wood-Working and Furniture Family Enterprises in Slovakia before and During the COVID-19 Pandemic

Enhancing Stakeholder Value: Managerial Activities in the Value Creation Process for Suppliers and Buyer—Evidence from Slovak Enterprises

Enhancing Stakeholder Value: Managerial Activities in the Value Creation Process for Suppliers and Buyer—Evidence from Slovak Enterprises

Effectiveness of Communication Tools in Slovak Enterprises Before and During the Covid-19 Pandemic

Effectiveness of Communication Tools in Slovak Enterprises Before and During the Covid-19 Pandemic

Increasing the prevention of process failure and the overall resilience of businesses through the process risk assessment

Research background: Properly set processes represent the basic framework of enterprise management. By assessing process risks, enterprises can timely identify problems in the implementation of processes, which can cause failure or interruption of activity, a decrease in performance, an increase in process costs, etc. Purpose of the article: The aim of the article is to identify, analyse and quantify the approach of enterprises to process risk assessment with the intention of improving processes, increasing the prevention of process failures and the overall resilience of the organization. Methods: A questionnaire was created to find out the attitudes of enterprises in the assessment of process risks. Data collection was carried out by an external agency using the Computer Assisted Web Interview method. The sample consisted of 353 enterprises from the business environment of the Slovak Republic. The questionnaire was evaluated using the simple sorting method. The research hypotheses were evaluated by applying Chi-square test. Findings & Value added: Enterprises most often assess risks in quality control, production processes, service provision processes. The frequency of assessment of process risks is for a third of the enterprises with every change, planning, disagreement or fluctuation of the economic indicator. More than 40% of Slovak enterprises do not have any management system implemented. The business sector is an important factor in the use of methods for the identification, analysis and evaluation of process risks. To identify process risks, in service sector, the owner/manager's own experience is used to a greater extent than in enterprises in industry. Enterprises in service sector use risk detection for risk analysis, industrial enterprises use process FMEA. Enterprises in service sector use scenarios analysis and enterprises in industry use the effectiveness of measures to evaluate process risks. Every tenth enterprise stated that the human factor is the cause of the occurrence of problems in up to 70% of all processes in the enterprise. Enterprises in service sector for process measurement use productivity of the enterprise to a greater extent than enterprises in industry, which use multiple economic indicators.

Managerial Decision-Making Methodology to Support Innovation Activities: Evidence from Slovak Enterprises

The creation of innovations in enterprises is a topic that has a firm place in the scientific literature, and the authors describe several procedures and theories of the functioning of the innovation process in enterprises. One part of the innovation process is decision-making. In the article, attention is paid to the results of research on the decision-making process as an important and integral part of the innovation process. The elements of the decision-making process and their impact on innovation represent an area of possible exploration and development of theories on decision-making in the innovation process. It is here that we have proposed a methodology for decision-making in the innovation process. The management of innovation processes, of which decision-making is an important part, provides multiple points of error for enterprises. Errors are experienced by enterprises due to a lack of information or its misuse, the influence of communication and time, and also the lack of experience of employees. The aim of this paper is to highlight the different decision-making criteria and approaches to innovation activities in Slovak enterprises within the framework of the developed methodology and survey results.

Effectiveness factors of small and medium-sized enterprises from the perspective of corporate culture: A case study in Slovakia

To reach business success, a company can use and manage a lot of seemingly inconspicuous and useful tools. One of them is corporate culture. The purpose of the paper is to define the factors that affect business efficiency from the perspective of corporate culture. The Organizational Culture Assessment Instrument (OCAI) was used. For data analysis, the Beta regression method, inductive statistics, and Tukey’s test were used. Based on the research results, it can be stated that there are significant differences in factors that affect the business efficiency of small and medium-sized enterprises in Slovakia from the perspective of corporate culture. The results show that effectiveness factors typical for clan corporate culture, such as teamwork, communication, loyalty, and human resource development, are applied in small enterprises. However, medium-sized enterprises are dominated by a hierarchical corporate culture with an emphasis on regulations, procedures, stability, control, and accuracy of management. It can be concluded that clan corporate culture is the best type of corporate culture for small and medium-sized enterprises in Slovakia. It is recommended to see the success of the enterprise in relation to caring for the people because employees represent a strategic tool in management that can influence the effectiveness of all business processes.

The Relevance of Sectoral Clustering in Corporate Debt Policy: The Case Study of Slovak Enterprises

The processing and transformation of natural resources into completed and semi-finished products is the primary function of industry in each nation’s economy. There is no denying the significance of industry and sectoral classification of the economy, but the slow development and extension of one industry could have resulted in the advancement of other sectors that are now a part of contemporary communities. Since there are statistically significant differences between various industries, numerous authors are currently investigating the impact of the industry on the financial structure of firms, revealing the industry as a crucial determinant of corporate indebtedness. Thus, the main aim of this study is to determine the debt level of a sample of 4237 enterprises operating in the market in the period of 2018–2021 from various sectors using eight debt indicators, as well as to identify relationships between them, which may help to reveal sectors with homogeneous patterns of indebtedness (using the cluster analysis) and thus understand which sectors are the most stable and independent. The Kruskal–Wallis test is then used to determine if there are statistically significant differences between the calculated ratios related to the economic sector. Based on the results, it can be concluded that the choice of financial structure is significantly influenced by the industry. Financial performance and indebtedness indicators are quantitative statistics used to assess, monitor, and forecast company or sectoral financial health. They act as instruments for business insiders and outsiders to assess a company’s performance, particularly in comparison to competitors, and to pinpoint its strengths and weaknesses, making the outputs of this study important for all types of stakeholders.

EMERGENCE, DEVELOPMENT AND SUSTAINABILITY OF INNOVATIVE ENTERPRISES

Currently, innovations introduced in companies that are exposed to a complex business environment are a hot topic of discussion. Their growth and sustainability are intrinsically linked to innovation processes. In order for enterprises to move forward, this very issue with its emphasis on strategic sustainability in such enterprises represents, in our view, a research gap that needs to be continuously explored in greater depth. In the present paper, we focus on Slovak enterprises that are based on the development of new products in Slovakia and which are also part of a stagnant innovation environment. Attention is drawn to selected aspects influencing innovation in enterprises, which should be perceived by companies not as a burden, but as an intrinsic need for their further development and their sustainability in the long term.

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

Research background: The corporate debt situation can be considered a crucial factor influencing the future development of the financial performance of the firm. It is essential for every business entity to know its financial health, its strengths and weaknesses, and how its business has been affected by the COVID-19 pandemic and all the changes it has brought. Purpose of the article: The main aim of this paper is to explain and quantify the consequences of the COVID-19 pandemic, analyze changes in the growth of crucial determinants, and identify new trends in Slovak enterprises throughout the monitored period of 2018‒2021. Methods: Hence, a statistically significant difference between the individual indicators due to the period in which the firms achieved these values was determined using the Friedman test. It determined whether the average values of the financial indicators remained constant over the period under review (the years 2018 and 2019 are considered pre- COVID-19 years, while 2020 and 2021 are years when the globe was already being impacted by the outbreak of the COVID-19 pandemic) or whether the individual values of the indicators differed significantly. Findings & value added: Considering that there are statistically significant differences in the indicators of self-financing ratio, current indebtedness ratio, and equity leverage ratio in all monitored periods except for the years 2020 and 2021, where the average values of these debt indicators are the same, the results indicate that the COVID-19 pandemic also negatively impacted the indebtedness of Slovak enterprises. Although this research paper, focusing on the financial performance of the firms in the post-pandemic period, is pioneering in Slovakia, the biggest contribution of the study is the application of the latest information, which could help in more precise monitoring of corporate financial stability and debt policy during the current challenging period. The obtained results provide important universal guidelines for building financial strategies improving long-term financial resilience of enterprises.

Impacts of COVID–19 pandemic to personnel activities in Slovak enterprises

The aim of the article is to identify and determine the extent of the impact of the COVID-19 pandemic on selected personnel activities of Slovak companies. Specifically, the article focuses on personnel activities such as recruiting and laying off employees, training, evaluation of work performance and rewarding. It also analyzes the change in forms of employing before and during the COVID-19 pandemic. Empirical data were collected by online questionnaire during May 2023 within randomly selected sample of Slovak enterprises. The research sample consists of 60 enterprises. The article brings the answers to two research questions.

THE INTEGRATION OF HR INFORMATION SYSTEMS UTILIZATION IN INDUSTRIAL ENTERPRISES

Human resource management (HRM) is of strategic importance for the management of organizations, therefore management measures in the field of HRM are of considerable importance for the performance of any organization. For the management of HR in the organization, it is important to have an information system that provides timely and reliable information necessary for decision-making. The article is focused on human resource management information systems (HRIS), which represent a significant part of corporate information systems. The main aim of the paper is to present the results of the analysis of HRIS used in industrial enterprises in Slovakia. The results of the analysis showed, that most often HRIS are only partially interconnected with other corporate IS. The results also pointed out that the used HRIS are considered mostly as useful and also demonstrated that how users evaluate the usefulness of the used HRIS is related to how they assess the integration of these systems with other corporate information systems.

Innovation as a Tool for Sustainable Development in Small and Medium Size Enterprises in Slovakia

Background: In the current global market, innovations are one of the tools of sustainable development. Therefore, companies must change their attitudes toward innovation strategies in accordance with international and national environmental standards, laws, and market requirements. We often come across, in particular, the evaluation of economic factors of sustainability, which cannot capture the attitudes of companies to the solved issue of the perception of innovation as a tool of sustainable development. Therefore, the Kano model and cluster analysis are used to evaluate the attitudes of Slovak small and medium-sized enterprises towards innovation, and the aim of this paper is to evaluate innovation as a tool of sustainability in enterprises in Slovakia. Methods: This article’s main research method is the Kano model and cluster analysis. Conclusions: The findings of this paper reveal how small and medium-sized enterprises in Slovakia perceive innovation as a tool for sustainable development. Based on the results, we can state the positive attitude of small and medium-sized enterprises towards innovations supporting sustainable development, focusing on frugal innovations characterized by cost reduction, as well as innovation targeting functions, standards, laws, and performance optimization. They perceive these innovations as attractive and their implementation in corporate structures as a basic function for sustainable development through innovation.

Determinants of the implementation of the quality management systems in SMEs

The implementation of the quality management systems using quality improvement methods, tools and approaches is considered one of the significant aspects to increase the per- formance of enterprises in the market environment and growing competition. Most of the authors studied the impact of any of the available quality management tools or philosophies on the performance of enterprises only on a case-by-case basis. The aim of the paper is, however, to examine the effect of implementing a larger scope of tools, approaches or concepts of quality management on the performance of the enterprise more comprehensively from the perspective of their implementation and the assumption of achieving higher enterprise performance. The paper presents the results of the survey, which was carried out from 2020 to 2021. The survey was focused on the implementation of quality management approaches and techniques in small and mediumsized manufacturing enterprises in Slovakia. A total of 313 small and medium-sized manufacturing enterprises were addressed through questionnaires. The representativeness of the sample was tested using the chi-squared goodness-of-fit test. Pearson’s chi-squared test and analysis of contingency were implemented to test the established research hypotheses. Through the results of the analyses, it can be claimed that there are significant relationships between the use of quality management approaches and techniques and the performance of enterprises measured through return of costs. At the same time, the most common reasons for implementing quality management approaches were analysed, which confirmed the hypothesis about the reasons for improving product quality and increasing customer satisfaction, which were based on theoretical assumptions verified in practice. The results also show the significant differences between the researched industries, which gives an opportunity for increasing the level of quality in individual segments.

Gender Equality Perception in Industrial Enterprises Under the Conditions of Industry 4.0

Abstract Provided that the industrial sector is digitized, it presents an opportunity to enhance the safety and quality of work for the workforce, and it should also lead to a positive social impact by reducing the gender gap and promoting equal opportunities for men and women. Gender equality does not mean sameness, but rather equal social status, rights, and obligations, as well as fair and equitable approach. Fundamentals for both prosperity and a sustainable world is established by the above-mentioned. The primary objective of the research described in this article was to examine the impact of Industry 4.0 on gender equality within industrial organizations and how gender equality is perceived by employees of industrial enterprises. The conducted questionnaire survey was focused on the application of the current state of gender equality under the conditions of Industry 4.0 in seven large industrial enterprises in Slovakia. The survey was focused on industrial enterprises. The most important findings of the conducted survey is the facts that women and men generally perceive the issue of gender equality differently, and that the majority of female respondents do not perceive the arrival of Industry 4.0 and the digitization and automation associated with it as a trend with positive impact.

Bankruptcy Prediction Model Development and its Implications on Financial Performance in Slovakia

Abstract Research purpose. Financial distress being a global phenomenon makes it impact firms in all sectors of the economy and predicting corporate bankruptcy has become a crucial issue in economics. At the beginning of the last century, the first studies aimed to predict corporate bankruptcy were published. In Slovakia, however, several prediction models were developed with a significant delay. The main aim of this paper is to develop a model for predicting bankruptcy based on the financial information of 3,783 Slovak enterprises operating in the manufacturing and construction sectors in 2020 and 2021. Design / Methodology / Approach. A prediction model that uses the appropriate financial indicators as predictors may be developed using multiple discriminant analysis. Multiple discriminant analysis is currently used in prediction model development. In this case, financial health is assessed using several variables that are weighted in order to maximise the difference between the average value calculated in the group of prosperous and non-prosperous firms. When developing a bankruptcy prediction model based on multiple discriminant analysis, it is crucial to determine the independent variables used as primary financial health predictors. Findings. Due to the discriminant analysis results, the corporate debt level of the monitored firms may be regarded as appropriate. Despite the fact that the model identified 215 firms in financial distress due to an insufficient debt level, 3,568 out of 3,783 Slovak enterprises operating in the manufacturing and construction sectors did not have any problems with financing their debts. The self-financing ratio was identified in the developed model as the variable with the highest accuracy. Based on the results, the developed model has an overall discriminant ability of 93% since bankruptcy prediction models require strong discriminating abilities to be used in practice. Originality / Value / Practical implications. The principal contribution of the paper is its application of the latest available data, which could help in more accurate financial stability predictions for firms during the current difficult period. Additionally, this is a ground-breaking research study in Slovakia that models the financial health of enterprises in the post-pandemic period.

Business interruption management in the context of the COVID-19 pandemic for small and medium-sized enterprises in Slovakia

Business interruption management in the context of the COVID-19 pandemic for small and medium-sized enterprises in Slovakia

The Investments in Human Capital within the Human Capital Management and the Impact on the Enterprise’s Performance

Human capital (HC) is a key factor for enterprises’ performance and competitiveness. The aim of this study was to identify how enterprises in Slovakia perceive the impact of the investments in HC on business performance within the context of the implementation of human capital management (HCM). The content analysis was applied to analyze the different authors’ opinions on the substance of HC. These opinions were compared, and the knowledge obtained was synthesized. The article’s originality stems from the evaluation of the results from a unique questionnaire survey conducted with a specific focus on IT companies. This follows the presumption that these companies approach the application of HCM in an exemplary way, while being considered knowledge intensive. To collect the primary data, a questionnaire survey was performed in 113 Slovak IT enterprises and its results were analyzed using statistical tests of independence. The main findings include the corroboration of a positive effect of investments in the employees’ education and the implementation of HCM on the enterprises’ performance. Despite this, more than a third of the enterprises did not evaluate the effectiveness of investment in HC, and more than half of enterprises did not have the HCM concept implemented. Several solutions are recommended with respect to the HR managers’ training.

Determinants of agricultural companies’ financial performance: The experience of Poland, Slovakia and Ukraine

The purpose of the study is to conduct a comparative analysis of the determinants affecting the financial performance of agricultural enterprises in Poland, Slovakia and Ukraine. As the main research method, panel data regression analysis was used to analyze data from 34 Polish, 123 Slovak, and 305 Ukrainian agricultural companies for the period 2017–2020. To analyze the links between financial performance measures and its determinants, nine models were developed based on three selected dependent variables (Return on Assets, Return on Equity, Return on Sales) in each of the countries studied. Seven independent variables were used, such as Leverage, Long-Term Debt to Assets, Short-Term Debt to Assets, Debt to Equity, Current Ratio, Asset Tangibility, Capital Intensity, and two control variables such as Size and Dummy variable for legal form. The most significant impact on the financial performance of agricultural enterprises has: for Polish enterprises – Return on Assets – Leverage and Asset Tangibility, Return on Equity – Debt to Equity and Dummy variable for legal form, Return on Sales – Current Ratio, Capital Intensity, and Size; for Slovak enterprises – Return on Assets – Current Ratio, Return on Equity – Debt to Equity, Return on Sales – Current Ratio, and Capital Intensity; for Ukrainian enterprises – Return on Assets – Leverage and Size, Return on Equity – Debt to Equity, and Current Ratio, Return on Sales – Capital Intensity.

Sustainability in Small and Medium Enterprises, Sustainable Development in the Slovak Republic, and Sustainability and Quality Management in Small and Medium Enterprises

In this paper, we deal with several areas, one of which is the current and important topic of sustainability. We focus on the defined area of sustainability in society and in companies. Sustainability is also a very important requirement for businesses today, including small- and medium-sized enterprises. Based on two hypotheses established by us, we identified, analyzed, and evaluated research carried out in the past in the Slovak Republic and in small- and medium-sized Slovak enterprises in the field of sustainability. The second important area that we deal with in our article is the quality of the products. Product quality is considered a necessity on the market today, a matter of course in today’s global market economy since it is one of the decisive parameters of the product. At the same time, quality management is only a means to an end, and that goal is a quality product for a customer who meets his requirements. Additionally, a quality product must also meet the requirements of other stakeholders, such as legislation. Practical and functional application of quality management in practice, companies, and organizations are implemented according to certain basic proven approaches, principles, standards, principles, and methods. Small- and medium-sized enterprises are a key part of every national economy; they form the national economic “backbone”. Due to their importance, they still need to be paid attention to, so we focus on these types of enterprises on several topics.