Process Approach In Bankruptcy Procedures As Innovative Tendency Of Crisis Management

Abstract

Bankruptcy is a necessary part of a market economy because it provides competition and a number of methods for resolving problems in case of financial insolvency of organizations. It is necessary to improve management processes at enterprises in bankruptcy procedures. Bankruptcy or financial inability is a procedure which is sanctioned by the court for the recognition of the debtor, unable to satisfy the claims of the creditors on monetary obligations and (or) to fulfil the obligations to pay regulatory charges for a certain period of time. There are four processes in bankruptcythree rehabilitation processes and a liquidating process. Such bankruptcy proceedings as observation, financial recovery and external management are rehabilitation procedures. Receivership is the liquidating process because its main objective is the realization of debtor's property and discontinuation of its activity. Theoretical and methodological foundations of the process approach in bankruptcy procedures are considered in the paper. The process approach helps to increase the effectiveness of management processes at enterprises being in crisis. Bankruptcy procedures are considered as processes represented by three levels: strategic, tactical and operational ones.