A regional network is an extremely broad concept. In fact, there are many, they are diverse.
The regional network is a specialized infrastructure formation in the territory of a certain region, functionally uniting in the context of state, industrial, financial, commercial, non-profit. This refers to regional departments, enterprises, shops, and departments that are limited by the industry and interacting among themselves.
As a social phenomenon, a regional network has emerged due to the demand by society for increasing dynamism, efficiency, flexibility, and manageability of the above institutions, enterprises and organizations.
This term is also used in a technical sense, which we will also mention in this article.
Economies of scale
What served as a theoretical justification for the expansion of network structures in modern society? Regional networks are a set of regional units that realize the potential for economies of scale.
It is universal, although it is open in the field of economics. Its meaning is to reduce the average costs while increasing the scale of production. The possibility of simultaneous and coordinated work with an expanded circle of consumers is a strong point of regional networks. At the same time, an increase in the efficiency of the system is observed at a certain interval.
The curve of the scale of production with a sequential increase in its volume has a distinct section of increasing income, its maximum and stabilization. They say about the stabilization stage that the current technology has outlived itself. Find a new one, and it all starts from the beginning.
The regional network, with its progressive development (upward section of the curve), takes advantage of specialization, logistics and management, expanded opportunities for capital investment and diversification of activities.
The managers planning it preliminarily calculate several options for the scale curve for various investment levels. Choose the optimal one.
Government Networks
The regional network of state institutions is actually a set of networks that carry out state and municipal administration. They work in the legal field of Federal Law 3184-F3 “On General Principles ... of State Authorities of the Subjects of the Russian Federation”. Her work clearly shows an increase in the level of centralization and management, lower costs, characteristic of the economies of scale, as we mentioned above.
Regional retail chains
Each resident of the Russian Federation, as a consumer, is faced with numerous local trading structures. Retail regional networks are diverse types of stores connected by a single management and accounting, common corporate standards and logistics. They include elements: “convenience store”, discounter, supermarket, hypermarket.
It is significant that the pace of development of network retail in Russia is one and a half times higher than GDP growth. It accounts for the lion's share of Russian consumer spending, which in turn accounts for 73% of their income.
Networked Industrial Formations
Of crucial importance for the development of regions is the networking of their industrial enterprises. It is based on:
- priority areas of entrepreneurship for the region;
- development, based on the existing infrastructure of the region, of the production and technical structure of a new network education;
- joining the network of service structures, permanent contractors of enterprises.
Currently, the most promising organizational forms of industrial enterprise networks are holding and franchising. Network education, which implies a rigid vertical management with equal rights for enterprises and their central management, is called a holding.
If the enterprises jointly plan development and minimize costs by centralizing the functions of management, advertising, and the introduction of technologies, then they choose franchising.
Regional networks of financial institutions
The “heart” of such a structure is the site of a regional bank or other financial agency. It has both open (public) partitions and closed (password-protected and “tied” to certain workplaces of department employees by their internal system numbers and IP addresses). Closed sections provide on-line operation of certified targeted e-mail, centralized licensed network programs of state and financial accounting, and the necessary information support for personnel.
Federal and regional networks
Meanwhile, even many economists do not understand what a regional network is, considering it a stage in the development of federal networks. They motivate their views by the fact that the latter significantly exceed the former due to the larger economies of scale. So should in the future combine regional industrial and trade networks into all-Russian ones?
Experts do not always come to an affirmative answer. Let us explain this with the example of the sphere of trade. Almost all federal retail chains developed from the capital, using the advantages in financing, business technology, and staff qualifications.
However, the business approaches of the “federals” do not always work in the regions. They are used to working in Moscow, where incomes are significantly higher. Hence the emphasis: on brands, on the quality of service, on the management vertical with high solvent demand.
Given the “non-brand” demand of the population in non-central subjects of the federation, a regional chain of stores that implements local trading strategies is often more advantageous. Although, in truth, these types of networks, serving consumers, complement each other.
MAN (Metropolitan Area Network)
At the current level, scientific and technological research is absolutely relevant and in demand in all areas of the economy and public administration, distributed regional information processing networks. The regional distribution network in the commonly used abbreviation is called MAN. However, we note that this term does not mean a holistic organizational union of institutions, enterprises, etc. It refers to the field of technical and information support.
In figurative expression, a regional computer network is a necessary component of the above networked government, industrial, financial, and commercial structures.
Conclusion
Network regional organization of management and business, no doubt, has not yet exhausted its reserves. Further GDP growth, the development of the constituent entities of the Federation, in turn, increase the level of investment. Moreover, network organizations of enterprises and institutions are the most favorable consumers of such investments. Why? Yes, because the fact of the existence of the network is already evidence of the prospects of a business or production, of successful investments. A significant role in the creation of regional networks is played by their computer component - the corresponding computer networks such as MAN. However, the leading role in their development is still the human factor.