TRANSFORMATION OF INNOVATION ACTIVITY OF BUSINESS ENTITIES UNDER CONDITIONS OF WAR CHALLENGES

Abstract

Under conditions of full-scale armed aggression against Ukraine, ensuring the continuity and effectiveness of the innovation activity of business entities has become a matter of particular relevance, since traditional models of innovation management have proven insufficiently adapted to the realities of systemic wartime destabilization of the economy. The purpose of the study is to systematize the directions and factors of transformation of enterprises' innovation activity under conditions of war challenges and to substantiate practical recommendations for adapting innovation management to armed-conflict conditions. The study covers an analysis of the factors influencing wartime innovation processes at three levels (macro, meso and micro) using an adapted PESTLE-like environmental analysis framework supplemented with a security dimension, as well as a systematization of practical models of business innovation adaptation. It is hypothesized that war challenges not only suppress but also selectively stimulate certain areas of enterprises' innovation activity, shifting its structure toward process, organizational and security-related innovations. The methodological basis of the study comprises analysis and synthesis of secondary statistical and analytical data, the method of classification and grouping, comparative sectoral analysis, and the method of generalization. The factors of destabilizing and stimulating wartime influence on enterprises' innovation activity have been systematized; six principal directions of innovation-activity transformation have been identified – product, process, organizational, marketing, social and security-related; the sectoral features of business innovation adaptation in industry, trade, logistics and information technology have been characterized; the leading role of production relocation, digitalization of management processes and diversification of energy-supply channels has been established as the dominant forms of business innovation response to war challenges. The obtained results are of theoretical significance for developing the concept of innovation management under conditions of heightened uncertainty and security risk. The practical significance of the study lies in the possibility of using the systematized directions of transformation to design enterprise innovation-development strategies and to shape state policy in support of business during the war and post-war recovery. The originality of the study consists in the comprehensive combination of level-based analysis of influencing factors with a classification of the directions of business innovation transformation under martial law. Prospects for further research are related to the empirical verification of the proposed classification through surveys of enterprises across various sectors and the development of quantitative indicators of business innovation resilience. The article is of a theoretical and applied nature.