Strategies for Relocation of Ukrainian High-Tech Enterprises During the Wartime
Olechnicka A., Kniazevych A. O.

Olechnicka, Agnieszka., and Kniazevych, Anna O. (2024) “Strategies for Relocation of Ukrainian High-Tech Enterprises During the Wartime.” The Problems of Economy 2:158–166.
https://doi.org/10.32983/2222-0712-2024-2-158-166

Section: Economics and Enterprise Management

UDC 338.001.36

Abstract:
The full-scale war gave impetus to significant migration trends that caused dramatic changes in Ukraine’s economy. Such trends have spread not only to people from the temporarily occupied territories, territories where active hostilities are taking place and there is a threat of shelling, but also intensified the relocation of various enterprises. There was a need to quickly move the assets of enterprises, employees and their families. The nature of such relocation and approaches to its implementation were different, supported by the authorities of Ukraine and other host countries, and depended mainly on the financial capacity of entrepreneurs, readiness to change location and a set of subjective factors, including the type of economic activity. Thus, the article is devoted to the study of the processes of relocation of Ukrainian high-tech companies, most of which are traditionally concentrated in the IT sector. The aim of the article is to study the strategies of relocation of Ukrainian high-tech enterprises during the wartime, to determine the factors influencing the adoption and implementation of decisions on relocation in critical conditions and conditions of uncertainty. The positive trends in the development of the domestic IT sphere before the full-scale invasion are analyzed, including entering the international arena as an outsourcer for Western countries. New challenges, and therefore new opportunities for the development of technologies and the high-tech industry caused by the war, are considered. The concept of relocation, its types and levels are identified. The main difficulties and efficiency of relocation of IT firms are defined, which depend on taking into account localization, the amount of costs, involvement of personnel, customers and partners, time and effort for a relocation, as well as on the reputation of firms and opportunities for their development. Each relocation is a unique economic and social phenomenon, and the impact on an IT firm may vary depending on the specific circumstances. It is quite important to plan and coordinate relocation processes to maximize benefits and reduce possible negative consequences. There is a difference in planning, coordinating, and financing the relocation process between large and small IT companies. The factors influencing the decision-making on relocation are classified. The development and implementation of relocation strategies took various forms. IT companies have demonstrated high adaptability and independence of action in the face of uncertainty and threats. The article conducts a SWOT analysis of Ukrainian high-tech enterprises, proposes typical scenarios for the development of events during relocation in the conditions of wartime in the form of a matrix of strategies. The relocation of Ukrainian IT companies took place on a significant scale, in some cases these processes began to be planned and even implemented even before the full-scale invasion for security reasons. The regional model of relocation was marked by the presence of powerful regional IT ecosystems, a focus on previous business contacts and family ties, relocation mainly to large cities, and the activities of organizations to support Ukrainian businesses during relocation within the borders of Ukraine and abroad.

Keywords: relocation, migration, wartime economy, business scaling, high-tech sector, IT firms, relocation factors, relocation strategies, relocation scenarios.

Fig.: 2. Tabl.: 2. Bibl.: 19.

Olechnicka Agnieszka – Doctor of Sciences (Economics), Professor, Director, Center for European Regional and Local Studies, University of Warsaw (26/28 Krakow suburb, Warsaw, Poland)
Kniazevych Anna O. – Doctor of Sciences (Economics), Professor, Professor, Department of Finance and Accounting, Stanislaw Staszic Academy of Mining and Metallurgy in Krakow (30 Adam Mickiewicz Alley, Krakow, 30-059, Poland)
Email: akniazevych@agh.edu.pl

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