M21 - Business EconomicsReturn

Logistics concepts are becoming less functional nowadays. The successful concept of just-in-time manufacturing seems untenable for 21st-century Europe. New ideas and new practices are emerging. One of the major trends in contemporary logistics is the demand-driven enterprise. Managing supply, fields and other processes in a company based on demand requires accurate demand forecasting at the relevant time. Relevant data are necessary for this forecasting. In the time of big data, the problem is not collecting data but evaluating them correctly. Data analytics is of great interest in business. The aim of the paper is to verify the possibilities of demand forecasting using traditional statistical methods (exponential smoothing, ARIMA), more advanced statistical methods (TBATS, etc.), methods based on artificial neural networks and a hybrid method. This is in conjunction with thorough data preparation, especially data normality testing. My research question is to provide, on data that contain a number of outliers, the results and the accuracy of the models when the data are or are not normalized. Demand forecasting for poetry books was chosen for the case study. The data were obtained from Google Trends data, i.e., searches for the topic of poetry for the period from 1 September 2013 to 31 September 2023. The results showed that the selected data contain a number of outliers that recur at regular intervals and are the result of a logical order of demand. The expected result was that data normalization increases the accuracy of the model. A method based on artificial neural networks provided significantly more accurate results. However, the resulting estimated underlying trend remained very similar. The article thus opens a discussion about the necessity of excluding outlying observations in time series where outliers exist at regular intervals.
Implications for Central European audience: The article poses fundamental scientific questions for Central Europe. Logistics concepts are developing rapidly in this area and Europe is the creator of significant innovations. Europe is currently facing great competition from foreign companies and new logistics concepts are becoming a necessity. Therefore, many European companies now feel the need to change their logistics processes. One of them may be to switch to an adaptive enterprise based on demand. The practical implications are also based on data from Europe.

The objective of the paper is to assess the advantages and disadvantages of costing methods for companies in the engineering sector. We compare traditional costing methods (absorption costing and marginal costing) with the activity-based costing (ABC) method. The analysis is carried out in Slovakia and Czechia. We examine the reasons for the transition to the ABC method and also the reasons for continuing to use the traditional marginal costing method. For statistical analysis, we use the chi-squared test, the chi-squared data distribution test, the Wilcoxon paired test and the Mann-Whitney U-test for two independent selections. We use each of these tests for the individual hypotheses and research questions in accordance with the nature of the specific data appearing under the given hypothesis or research question. Slovak companies are statistically significantly more likely to perceive doubts about the suitability of the ABC method as its disadvantage compared to Czech ones. In the end, proposals for business practice are presented.
Implications for Central European audience: Managers of engineering companies are aware of the role and importance of costing, but they usually do not pay enough attention to the actual compilation and monitoring of costing. We analyse a selected sample of Slovak and Czech companies, but our conclusions and proposals can be generalized and applied in other Central European countries, which have similar political and economic environments, culture and history.

Nowadays, in times of the corona crisis, controlling is gaining much attention because it represents an effective internal mechanism that can greatly contribute to a timely and rapid response to changes. Controlling activities reflect the quality of company management at the strategic, tactical and operational levels. In doing so, controlling uses appropriate instruments and contributes to business efficiency and effectiveness. The research aims to determine the current state of controlling instrument application (operational/strategic) in companies. Furthermore, we examine the role of controlling in stabilizing business operations and adjusting business strategies that affect business performance indicators in the context of the corona crisis. The survey method was used, and data were collected from 180 companies of different sizes in the Republic of Croatia. The survey was conducted in 2021. Nonparametric techniques, the chi-square test and the Kruskal-Wallis test were used for hypothesis testing. The findings show that (i) there is a significant relationship between the role of controlling in business stabilization and business strategy redirection in times of corona crisis, thus affecting business indicators measured by liquidity, profitability and indebtedness; (ii) there is a statistically significant difference in the application of operational controlling instruments between companies that have established a controlling department and those without a controlling department; and (iii) there is no statistically significant difference in the application of strategic controlling instruments between companies that have established a controlling department and those without a controlling department. The results of the study provide insight into the application of controlling instruments in Croatian companies during the corona crisis and empirical implications for both academics and practitioners.
Implications for Central European audience: Nowadays, market volatility and external factors significantly influence business decisions of Central European companies. For managerial decisions to be timely and effective, controlling uses various instruments with the aim of better advising managers. To be more agile, companies have to use a combination of operational and strategic controlling instruments. In the Republic of Croatia, as a post-transition country, companies are more short-term oriented, which is visible in the significant use of operational controlling instruments, and the lesser use of strategic controlling instruments. In times of pandemic and geopolitical events, the results of the research indicate the need for strategic orientation of companies through the application of strategic controlling instruments in the practice of Croatian companies to increase the efficiency and effectiveness of their operations.

Compliance costs are significant, and data related regulations are more frequent. The study argues if compliance spending can also generate additional value, as just a minimal regulation requirements fulfilment is not by any means achieving a competitive advantage. To test the hypotheses, a quantitative method with Structural Equation Modelling and Partial Least Squares (PLS) in the SmartPLS tool is used. The empirical data is collected from 98 data management professionals involved in recent European Union and General Data Protection Regulation (EU GDPR) projects associated with party data in larger organizations across Europe. The study suggests that Data Governance Span (DGS) leads to the increase of both data compliance related variables - Data Compliance Innovation (DCI) and Privacy Project Efficiency (PPE) - at the same time. However, its effect on the increase of Data Compliance Innovation (DCI) is weaker than the effect on the increase of Privacy Project Efficiency (PPE). Customer-Centric Orientation (CCO) is discovered to be an underlying mechanism of the relationship between Data Governance Span (DGS) and Data Compliance Innovation (DCI).
Implications for Central European audience: Firms in Central and Eastern Europe (CEE) did not use innovation enough in data compliance. DCI is the lowest in the CEE region DGS1 is the second lowest in CEE compared to all-regions-average. DGS1 refers to the business stakeholder involvement in the formal engagement, which assumes their responsibility.

The growing uncertainty in today’s business environment has a significant influence on social business’s behaviour. Those enterprises could rely on public support in the past, but nowadays, they have to find a way to be more responsible about their social activity and be financially independent on public resources. Based on this theoretical background, the paper’s main goal was to find a set of factors that influence crucial financial decisions within a crisis. When social businesses create an optimal financial portfolio to be financially sustainable, primary research was conducted. A sample of 57 social businesses was asked about their financial strategy. The main research goal was to compare a change before and after the first wave of the Covid-19 pandemic situation in 2020. This case has shown current financial thinking and preparedness for unusual or crises. A mixed research approach was chosen due to a limited number of respondents. The overall results found that those businesses prefer to use the current strategy (42%) in crisis, and they limit investments to survive in that situation, except marketing investments (16%).
Implications for Central European audience: At the theoretical level, our study shows social enterprise concepts in the Central European context, which differs somewhat from the already established definition of mainly Anglo-Saxon and American authors. At the same time, it combines knowledge about the use of financial planning in this segment. The study results show that financial planning is essential in these companies because it can achieve social goals. A discussion would be opened on how to raise awareness of the preparation of the strategy.  Alternatively, how to strengthen the financial literacy of managers or representatives of these entities.

Globalisation and increasing competition affect all existing enterprises, as well as those in emerging economies. For this reason, enterprises continuously improve their own management systems and try to gain a competitive advantage in the market in addition to eliminating shortcomings. In emerging economies in Central Europe, including Slovakia, there are still not well-established tools to support management decisions that could reveal reserves, identify deviations from the required state and reflect all these attributes in the system of motivation, evaluation, and remuneration of employees. Controlling is such a tool, the implementation of which is a prerequisite for growth in performance and market value of the enterprise. The aim of the paper is to identify and present the optimal software support for controlling for the given segment of enterprises based on the mapping of the current state of using Business Intelligence to support controlling in micro and small enterprises (MSEs) in the conditions of the specific emerging economy, namely Slovakia. This information system will allow MSEs to respond flexibly to market changes, offer alternative options to support managerial decisions and can simulate the impact of any change in the plan on business management. Within empirical research, a questionnaire was used as a method to survey the given problem in the business practice of micro and small enterprises in Slovakia. The questionnaire was sent to 2,415 MSEs, with the research sample consisting of 421 respondents, i.e. of 17.43%. The survey meets the condition of a minimum sample size. We focused on groups of micro and small enterprises, as these represent 99% of the country’s market potential. While the introduction of the controlling module into the basic information systems of the company or Business Intelligence are investment-intensive for MSEs, as a real option, affordable software support for controlling based on the MS Excel programme was identified in practice. In view of the above, a prototype of a controlling information system called ‘SOFIN-KA’ was designed and successfully tested in the practice of the Slovak Republic in an MS Excel programme, which is customisable to each MSEs.
Implications for Central European audience: For the success of micro and small enterprises (MSEs) in today’s turbulent business environment, it is important to make better and faster decisions. However, MSEs in Central Europe, including Slovakia, currently do not often have sufficiently established tools to support management decisions. One of the ways to solve this problem is controlling. The proposed software support for controlling is applicable not only in Slovak MSEs but also in V4 countries. The software has been designed this way that it can always be adapted to the specific conditions of each company.

This article aims to find out which business risks determine the perception of the business environment of small and medium-sized enterprises (SME) in the future. 454 SMEs from the Czech Republic participated in the case study by filling in an online questionnaire. Linear regression models were used to verify statistically significant causal relationships between selected indicators of business risks and respondents' perception of the future of business. The results show that selected indicators of the market, financial, personnel, legal and operational risk determine the perceived future of business. Strategic risk indicators do not significantly affect the perceived future of business. The most important indicators: market risk — adequacy of sales of products and services; financial risk — an indicator of the company's financial performance; personnel risk — an indicator of employees' initiative to increase performance; legal risk — an indicator of respondents' ability to understand the basic legal aspects and operational risk — an indicator of the use of company capacities. All the indicators from above have a positive effect on the future perception of the company.
Implications for Central European audience: The attitudes of small and medium-sized enterprises represent a certain degree of subjectivity (human factor), which does not always reflect the real position of the enterprise. However, it is the main representatives of SMEs (owners and top managers) who try to manage business risks to have a more positive perception of their future in the business environment in the Czech Republic. The results based on the business environment of the Czech Republic are important not only for the owners of SMEs, but also for state and non-profit institutions dealing with various forms of SME support.

This article analyses the impact of the changes in hard commodity prices in the world commodity exchanges on the variation of countries’ general price level. In other words, this article aims to determine the impact of hard commodity prices changes on inflation. In this paper, all countries of the European Union (EU) are included in the research, and case analysis is done accordingly. The methodology applied is the following: a study of the recent scientific literature, processing and systemization of statistical data, correlation analysis and Granger causality test. The results of the research show that price changes of selected commodities in world commodity exchanges have no absolute dependence on the variation of the general price level in EU countries in the long period. Natural gas should be distinguished, whose price fluctuations in the commodity exchange market show a positive correlation with 14 EU countries’ CPI changes. In addition, the research shows that Lithuania’s inflation has been affected by all five selected commodities’ prices fluctuations. UK and Romanian inflation relate to four of five selected commodities’ prices fluctuations.

There are many methods of forecasting, often based on the specific conditions of the given time series which are frequently the result of research in scientific centres and universities. Nevertheless, there are also models that were created by scientists in a particular company, examples may be Google or Facebook. The latter one has developed one of the latest Prophet forecasting models published in 2017 by Taylor & Letham. This model is completely new and so it is appropriate to subject it to further research, which is the topic of this article. To accomplish this research objective, the aim of this work is to identify seasonal trends in revenue development in a selected e-commerce segment based on the assessment of the applicability of the Facebook Prophet forecasting tool. To accomplish this goal, the Python Prophet is decomposed with a subsequent two-year forecast. Accuracy of this model is measured by RMSA and coverage. The e-commerce subject selected is active primarily in the field of sales of professional outdoor supplies and organizing outdoor educational courses, seminars and competitions. It is clear from the prediction that the e-commerce entity shows a strong sales period with the beginning of the spring season and then, due to the summer, decline, until the pre-Christmas period. The subject has little growth potential and a new impetus is needed to increase sales and thus restore the growth trend. It has been confirmed that Prophet is a suitable tool for debugging seasonal tendencies.

The study examines the relationship between the governance program teams, business user participation, and innovation in data compliance projects. Many firms continue to struggle with their governance programs as its effective implementation requires organizational change and a higher rate of involvement of those with significant knowledge of the context of the system use. Leadership elements are observed in governance teams and the way how these elements impact both, participation and innovation in recent General Data Protection Regulation (GDPR) data compliance efforts. To test the hypotheses, a quantitative method with Structural Equation Modelling and Partial Least Squares (PLS) in SmartPLS tool are used. The empirical data are collected from 98 data management professionals involved in projects associated with customers’ data in larger organizations across European Union (EU). Research findings show that Governance Team Leadership (GTL) influence positively Line-of-Business Stakeholders Participation (LOBSP) and LOBSP influence positively Data Compliance Innovation (DCI) in GDPR efforts. Moreover, it shows that LOBSP is the underlying mechanism (mediator) of the relationship GTL and DCI. Data governance transfers data and information management towards managerial functions and strategic management. Data has become embedded within nearly every department and business unit, and its proper enterprise-wide governance requires much more rigorous alignment with business users and formation of one cross-functional unit – data stewardship team of proactive leaders. In opportunities and restrictions of data revolution underway, evidence of any sustainable organizational practices leading to innovations and competitive advantage is beneficial.

The article analyses the technical efficiency of enterprises producing wine in the Czech Republic in the context of provided subsidies. In this paper only the effect of Rural Development Programme subsidies (measure 1.1.3 in 2007–2013 and 4.2.1 in following RDP 2014–2020) are analyzed, where wine producers belong to the main recipients. We used unbalanced data set for the time period from 1998 to 2016. The main aim of this paper is to evaluate the technical efficiency of wine producers and to figure out whether there are differences between supported and non-supported firms – according to the size of enterprise and region. The true fixed effect model was used to do the analysis. Supported producers in general were more technically efficient, but this result was not statistically significant. By region distribution, supported firms were also more efficient, but not significantly. The same result was true for the distribution according to the size. To summarize, the effect of support in this sector is not significant.

The article aims to evaluate the impacts of strategic investments in biogas plants on the economic sustainability and vulnerability of farms with a special focus on investment subsidies. Data spanning 148 farms from the Czech Republic over a thirteen-year period (2004-2016) are used to estimate random effects panel regression models to quantify the short-term and long-term economic sustainability and vulnerability of integrated energy production in the context of mixed type farming. Investments in biogas plants can negatively affect the viability of agricultural companies in the short term because farms which invest in biogas suffer from debt pressures due to inadequate revenues in the construction phase. However, in the long term, the effects of biogas plant operations are positive: economic sustainability is enhanced and vulnerability is reduced mainly due to public support for renewable energy production in the form of feed-in tariffs and green bonuses. Comparing farms that received investment subsidies with nonparticipating farms indicates a high deadweight loss effect which means that programme participants would undertake a similar investment without programme support. However, the investment subsidies improve recipients´ cash flows.

This article deals with meat industry subsidies in the Czech Republic. Food processing businesses are entitled to draw funds from the Rural Development Program 2007-2013 (RDP), Axis I, Measure I. 1. 3 Adding value to agricultural and food products. The aim of this paper is to assess whether there were any changes in performance indicators in subsidized meat businesses and to identify their effects on the meat industry. Competitiveness of meat industry is low. Subsidies are among other factors that can help to reach for better competitiveness of this branch. The fixed effect model was used in order to carry out the analysis. According to the results, subsidized meat enterprises did not display any increase in business performance (no increase in labour productivity, value added growth in the supported firm were found) and cannot be considered as a key factor of competitiveness. There was a positive impact on the number of employees and the value of fixed assets in the year the subsidies were drawn. However, the effective use of workers and property did not reflect other performance indicators in the year of drawing.

Social Entrepreneurship has become a buzzword due to the exponentially rising number of scientific works devoted to this topic. The prevalent part of the research focuses on the social side of the venture, while the other equally important entrepreneurial side is still in the shadows. Can it be that social entrepreneurs do not value the entrepreneurial aspect (inventing, founding and developing) of social entrepreneurship and are engaged in these activities merely because of other goals and passions (for example “helping”, “social welfare” etc.)? This research conducted in Entrepreneurial passion, aims to identify the differences within the domain of inventing, founding and developing passion among social and commercial entrepreneurs. The paper also aims to find out if the cliché about the social cause being the only force that moves social entrepreneurs is right. The primary data was collected among 87 social and 119 commercial entrepreneurs. The Welch`s t-test and the Mann-Whitney-Wilcoxon test were applied. As a result, no statistically significant differences were found in any of the mentioned aspects (Inventing, founding and developing) of entrepreneurial passion of social and commercial entrepreneurs.

The goal of this paper is to analyze main changes in the business performance - as in part of the overall competitiveness - of the Visegrád Group, i.e. Czech Republic, Slovak Republic, Poland and Hungary, in the last ten years, 2004-2014, based on Pearson correlation, Chow and Granger Causality tests. The business performance in the Visegrád Group is defined with the help of five indicators: business density, value added per business entity, investment in fixed capital per business density, inward foreign direct investment stock per business entity and exports of goods and services per business entity. The author finds that the business performance, and hence the business environment, in the Visegrád Group has diverged since EU accession with the exception of internationalization indicators, which indicates the necessity for managers to adjust to the specifics in each particular country.

Financial analysis is an essential tool for those interested in assessing the economic management situation of enterprises and subsequent decision making. The aim of this article is to demonstrate the capacity the IN Financial Analysis (INFA) system has to inform, i.e. its information capability. This is a tool that allows users to comprehensively assess the economic management of enterprises in that it causally links the indicators of financial controlling and risk controlling. We apply it to the best industrial enterprises in the Czech Republic in 2011 and 2012 and at the same time use the representative database of the Ministry of Industry and Trade of the Czech Republic.

Small- and medium-sized companies usually perceive controlling in connection with financial management. However, this is a serious mistake, which may have very unpleasant consequences for businesses. Such consequences are usually connected with a failure to achieve operational and strategic aims in the area of sales, production, innovation or marketing. For companies, a failure of marketing and sales controlling means that achieving the aims in the area of customer relations management is threatened, which subsequently results in the company's sales not being fulfilled. This may result in a failure of the corporate strategy in the medium-term, which tends to be followed by a failure of sales and a threat to liquidity. Absence of marketing and sales controlling is usually the most frequent cause of a crisis. Therefore, the aim of the article is to describe the main areas of marketing and sales controlling and its relation to risk management.

The objective of the paper is to assess the reasons for the current negative position of the Czech Government toward euro adoption and to find out whether the expected benefits of euro adoption for Czech companies still remain. The postponement of euro adoption in the Czech Republic has mainly been caused by the current problems of the euro area. The benefits arising from euro adoption are subject to the reduction of the exchange rate volatility and of the transaction costs, whereas they also depend on the degree of integration with the euro area. These benefits may still be expected - neither the financial crisis nor the economic recession has affected them. The integration of the Czech economy with the euro area is high and still growing. Therefore, euro adoption will lead to the stimulation of mutual trade of the Czech Republic and the euro area.

This paper discusses the possible applications of PEST analysis with the use of methodology and data from The European Bank for Reconstruction and Development, and The International Bank for Reconstruction and Development/World Bank/International Finance Corporation. A practical example shows how to use the models when setting up a logistics service company in selected Central/Eastern European markets. The combination of PEST and EBRD/IBRD reports is seen as a viable tool for measuring market potential, its growth or decline, as well as the attractiveness, business opportunity and suitability of access into these countries.