The Peculiarities of the Functioning of Altai Krai Heavy Industry Enterprises During the Second Half of the 1990s (A Case Study of the Barnaul Hardware and Mechanical Plant)

The article investigates the functioning of Altai Krai industrial enterprises during the second half of the 1990s as exemplified by the Barnaul Hardware and Mechanical Plant (BAMZ). The aim of this study is the financial and operational activities of BAMZ during the period of market mechanisms development. The annual financial reports of BAMZ were analyzed, crisis response measures of the plant were studied, peculiarities of the social and economic state of Altai Krai during the second half of the 1990s were considered, and professional activities of V.N. Rakhmanov, the BAMZ CEO, were assessed to achieve the aim of this study. The sources for the study were the official statistical data from the Altai Krai local administration, data from printed media and archival records. Data from the Current Archive of the Property Fund of Altai Krai (years 1996-2001) were first introduced into academic discourse. In the course of the study, the author concluded that the market mechanisms development in the industrial sector of Altai Krai was accompanied by a decrease of production rate in most branches of production. In the second half of the 1990s, the Altai Krai factories were actively developing the domestic market. Therewith, foreign companies were strongly competing for the market. Manufacturing of commercially viable products required renovation of production facilities, long-term purchase contracts, capital investments, cost saving, stable operation of the financial system, etc. The production optimization of BAMZ was accompanied by the reduction of production staff. Cost saving, development of new production items, their sales both in domestic and foreign markets allowed BAMZ to avoid bankruptcy and keep the 1996-1997 financial balance positive. Massive reduction of staff was a desperate measure to keep the plant in operation. The BAMZ administration paid special attention to the financial support of the personnel. In 1998, the production volume increased. The economic crisis decreased the competition on the domestic market and allowed for an increase in sales of the plant's products. Starting with 1998 and until 2001, the enterprise constantly increased its production rate. Its chosen anti-crisis strategy allowed to earn profit on financial activities by 2001, pay the debts from earlier years, increase personnel payment, and invest into the development of new products. Rakhmanov's long-term service as the CEO resulted in the organization of production activity under free market conditions, development of commercially viable products, increase in key financial performance indicators of the plant after the financial meltdown of 1998.

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