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ISSN : 1598-7248 (Print)
ISSN : 2234-6473 (Online)
Industrial Engineering & Management Systems Vol.18 No.3 pp.440-453
DOI : https://doi.org/10.7232/iems.2019.18.3.440

# Innovative Approaches to Business Managing Functional Areas in a Territory

Boris Sultanovich Kasaev*, Maria Vladimirovna Petrovskaya, Murat Borisovich Kasaev
Department of Management at the Financial University under the Government of the Russian Federation, Moscow, Russia
RUDN University, Moscow, Russia
Government-Financed Institution “Social Center Kontakt”, Moscow, Russia
Corresponding Author, E-mail: boryskasaev@yandex.ru
May 29, 2019 June 16, 2019 June 19, 2019

## ABSTRACT

Information support for organization and management of functional areas in a territory has been considered from the standpoint of innovation. Adequacy and proximity of territorial life activity perspectives based on interaction of its functional areas to the perspectives and concepts of spatial economics has been shown. Based on the requirements of a system approach, a set of structures that determine the operation of social and business areas in a territory has been considered; management of a social and business area in a territory is presented as an act of impact on facilities in the functional areas of a territory for the purpose of changing their operational format and can thereby selectively affect each of six parameters and current characteristics of a model reflecting the state of functional areas in a territory that are listed in the paper below. The work also justifies an approach to implementing a distributed information system to support processes through the case study of a control area, a functional agricultural area in a territory, which uses Blockchain technology for gathering, processing, storage, organization and management of key data about each product through the example of products in the functional agricultural area of the territory during their life cycles.

## 1. INTRODUCTION

Socio-economic assessment of a territory (a municipality, a region, or a country) (Karpova et al., 2014) assumes a character of a system research of the processes occurring therein during its life activity with a view to identifying key issues and finding provisions to improve the levels of its socio-economic development (SED). In this regard, the state of such processes occurring in its seven functional areas is the subject of this research (Figure 1).

On the subject matter in question, since the life activity of a territory appears as a system that is formed by three modern tools of its development, such as management, marketing and logistics, three main aspects are considered as resources for providing the basis for its management: substance and energy, economic, and informational. This study considers possible areas of improving theoretical and practical approaches to the formation and development of effective methods and mechanisms to manage the information support for vital processes in the functional areas of a territory in the format of spatial economics models.

## 2. THEORETICAL FRAMEWORK OF THE RESEARCH

In the framework of system information approach, management of a social and business area (SBA) as part of a functional area of a territory (Figure 1) is represented as a two-tier hierarchical structure, with all the other functional areas of a territory at the lower level and with control nodes associated with controlled objects and among themselves via communication channels at the higher levels.

In this structure, the information circulating in an SBA exists in three following forms:

• - apprising, coming predominantly from controlled objects (functional areas) to the respective control nodes;

• - control, going in the reversed direction;

• - transforming, changing the behavior of control nodes and the functioning algorithms of individual elements

The control nodes considered therein transform apprising information into control information through mechanisms for transforming information in an SBA itself. Various structural subdivisions of the other functional areas in a territory engaged in industrial and environmental activities in a territory serve as generators of a primary apprising information flow (The Russian Government, 2008;Krevens, 2003;Lambin, 2007;Margolin, 2007;Gumel, 2017;Abualrejal et al., 2017). In the SBA structure, the information is summarized as it moves upward, is transformed in different control nodes and is fed to the main SBA control node at the top of the hierarchy. Using the apprising information, the master node generates con-trol information that, while moving downwards, is detailed by functional areas in the underlying nodes. It should be noted that in order to increase or decrease the level of autonomy of a particular node, it is necessary to take into account the time it takes to form information from the higher nodes. In order to achieve the goals and sub-goals of managing the SBAs in a territory, it is obvious that only necessary and sufficient information from its functional areas would flow to the respective control nodes. In this regard, during the process of managing the territorial SBAs, it is the content characteristics of data that become important. Normally, the territorial processes in an SBA are controlled in conditions of insufficient information; it suffices to recall the threat of anomalous natural and man-made processes. On the other hand, this is also due to the fact that control nodes in all the functional areas in territories are usually a heterogeneous structure, therefore, their associations are only partially cognizable, and in this regards are partially regulated and partially motivated.

The economic system of a territory with a dedicated social and business area can be in two possible states during the implementation of activities: one state is functioning, and the other state is development (degradation in particular cases); both processes are launched and coexist in parallel but not necessarily occur synchronously (Farzadnia et al., 2017;Sharif and Butt, 2017).

When identifying and researching SBA operation goals, it is advisable to take it as a whole set of structures (Figure 2): the structure of industrial and environmental process (IE) itself, the structure of supplying the industrial and environmental process with energy (ES) and substance (SS), and a set (a hierarchy) of unachieved goals.

Each of these structures has a conjugate structure of control nodes (CNs). The structure of control nodes is hereinafter referred to as an “external” control structure (Novikov, 2007).

The structure of unachieved goal concentrator is an important component of a territorial SBA, since it contains the most complete information reflecting the state of relationship between the goals and sub-goals of its operation and the actual functioning of the system. In addition, based on this information, remedial measures are taken and an action plan is drawn up to compensate for deflections from the projected course of SBA functioning. The structures of the goals that are shown in Figure 2 determine requirements both for SBA functioning parameters as a system and for its parts. Thus, the goals are presented herein as isolated sets of structurally related rational conditions for SBA system functioning and its elements. The structure of goals is somewhat primary, since it generates control nodes to achieve the goals.

## 3. CONCEPTUAL MODEL OF THE RESEARCH

The level of socio-economic development of a territory depends on optimal organization of SBA activities. Therefore, on the one hand, the more sophisticated the territorial functioning processes (from the standpoint of territorial marketing and disposal of territorial products) and its subsystems are, the more requirements are to be reflected in the control nodes and the more difficult it is to ensure their implementation, on the other hand. As noted above, SBA management appears to be an act of impacting the objects in a territory for the purpose of changing the format of their operation, while selectively affecting each of the six listed parameters and characteristics of the model:

• - composition of objects and elements of the functional areas in a territory;

• - structures of objects and elements of the functional areas in a territory (a set of informational, control, technological and other links between the objects and elements of f-areas);

• - a set of permissible strategies (restrictions on activity standards) of SBA participants, reflecting a variety of restrictions imposed on it operation;

• - preferences of the SBA participants;

• - awareness of each active SBA element of a task to make a decision about planned strategies;

• - operation rules (mechanisms for obtaining information and implementing strategies by active SBA elements).

Let us clarify some parameters from the list above (Novikov and Novikov, 2007;Rays and Trout, 2003;Muhammad, 2018;Marques et al., 2018). The “composition” concept establishes “who” can enter the system, the “structure” concept defines “who is connected with whom,” the concept of “permissible sets” identifies “who implements what,” the concept of “objective functions” describes “who chooses what,” and the “awareness” concept explains “who knows what.”

The structure of goals as a requirement for the territorial management system operation is not always considered optimal, since practice shows that, due to a large number of dimensions and complexity of solving numerous problems associated with a territory functioning, it is not possible to accurately predict its development. In fact, it turns out that any structure of goals in the minds of planning agencies, developers or researchers of territorial problems is only more or less a subjective assessment rather than exact operating conditions of the territory from the standpoint of optimality. The main drawback of modern approaches to the territory management is that selection elements, such as target figures, do not immediately manifest but after a certain time when the time is gone, contrary to expectations.

Naturally, an SBA responds only after its negative consequences have manifested. Does this mean that the construction of absolute goal structures that would formulate truly optimal requirements for both an SBA and its control nodes is unfeasible? According to the authors, based on such tools as territory management and marketing, it is necessary to look for new approaches and solutions premised on studying the life activity of the functional areas in a territory.

## 3.1. Research Materials and Methods

The SED direction is one of the three global areas con-sidered in the territory development strategy (Dalevska et al., 2019):

• - socio-economic development;

• - improved investment activity;

In Sachuk (2009) absolutely rightly defines marketing as a very complex concept. Perhaps it is for this reason that scientists and practitioners have failed so far to reach common ground regarding the concept of marketing, its place in management, development, production and sales of goods. In addition, it should also be pointed out that the marketing of territories is much more complex than the marketing of goods and services on the consumer list.

Nevertheless, it appears necessary to determine the ratio of management and marketing functions in territory management, whereby the authors complement the structure by Strategy of innovative development of the Russian Federation for the period up to 2020 (The Ministry of Economic Development of Russia, 2010) so that all the constituent elements of marketing and management are functionally distributed and coordinated (Figure 3).

To justify the choice of new approaches and the foundation of studying the life activity of the f-areas in a territory, the authors have conducted a marketing analysis of information support for SBAs from three perspectives: composition, structure, and properties. The same differentiation can be applied when descending to the following levels of abstraction (Zare and Rajaeepur, 2013;Tebekin and Kasaev, 2011):

• - subsystems;

• - information nodes (generators and information users) and communication channels;

• - information transducers (people, machines, and algorithms).

Information composition refers to composition in the structure of goals, their types, possible forms of manifestation of information and methods of its processing.

The structure of information transmission, processing and transformation by the entire SBA inside a control node and the algorithm structure of an individual information transducer can be referred to information structure.

In addition, various forms of relations between individual subsystems and elements of these subsystems, including relations between team members, active elements of control nodes in individual cases, as well as relations between an active element and a machine can be included herein.

Information properties may include such assessments as the disorganization level of SBA operation against the goals specified; the value level of information circulating in the system; the adequacy of algorithms used to process information.

Such an analysis serves to create such management methods that would allow one to transform the structure of the goals formed in such a way as to remove contradictions between the goals, to upgrade management as an indisputable method of achieving the goals, and to ensure consensus in control nodes.

The authors analyze the level of organization of territory operation and attempt to quantify it as another new approach that underlies studying the life activity of the f-areas in a territory.

Organization is a relative concept that can be considered in relation to a basic consideration criterion (order reference, goal, etc.) (Walker, 2006;Chahine, 2018;Nurgaliyeva et al., 2018). Since the authors are not so much interested in assessing the organization in general but rather in terms of goals of managing the SBAs in a territory, it is advisable to take the structure of management standards, that is, a goal structure, as references. What does goal setting refer to from the organization perspective? This is setting “absolute” values of the territorial administration system organization within some aspects of its functioning (Оgi), for example, setting values xi, yi, zi in coordinates x, y, z. Then, the “absolute” functioning organization of the SBA under consideration in relation to the i-th specified goal (Oi) can be viewed as the difference between Ogi and disorganization in the system functioning in relation to the goal (Oi), which arises from the fact that the goal is not achieved completely. The equation corresponding to such a statement is written as follows (Fatkhutdinov, 2002):

$O i = O g i − O ¨ i$
(1)

A certain function of the mismatch between the current SBA state and the point with xi, yi, zi coordinate will correspond to negative organization in the space of the coordinates indicated. When assessing the managerial parameters of an SBA, after checking and justifying a goal, one should try to determine not its “absolute” functioning organization but rather the state of its disorganization Ӧ; this decision is premised on the fact that since this indicator is operational information about the management quality, therefore, it can serve as feedback. Measuring the degree of non-achievement of goals in an SBA, it is possible to obtain the structure of disorganizations. The following global development directions considered in Rays and Trout (2003) correspond to the said calculation coordinates: the SED level, the image, and the investment activity, which can be used to assess the degree of organization of a territory, describing it also from the viewpoint of SBA efficiency.

## 3.2 Implementation Mechanisms and Targets

Next, let us consider the mechanisms for implementing priority territorial transformations in SBAs and set targets based on marketing tools differentiating managerial decisions that allow for competitiveness and sustainable development of municipal economies.

In the framework of implementing the regulations for governing a specific territory, based on the existing rights and duties of the management bodies, a purposeful interaction of the production, labor, innovation, and investment potentials of the territory is ensured (Bezpalov et al., 2019;Novikova et al., 2016).

Innovative solutions usually affect the designated regulation framework, whereby the implementation of such innovations requires significant costs and energy with the participation of all consumers of the territorial product (Mazur et al., 2016;Akhmetshin et al., 2018;Gunyakov and Gunyakov, 2013).

The mechanisms under consideration for implementing priority innovations should be built into the institutional and managerial structure of an administrative and business area of a territory, its content being presented as a structure formalized as a three-tier territorial development strategy management structure (see Figure 4).

Within the framework of the first contour, a systematic assessment of the state of socio-economic system, a preliminary selection and calculation of investment projects for improving marketing activities is made;

Within the framework of the second contour, assessment of changes in the territorial potential for adjustment in the next planning period as a result of investment, as well as revision of element-by-element changes in the level of socio-economic development (SED) is made;

Within the framework of the third contour, the baseline data are redistributed for strategic planning of the next SED cycle and formation of targeted marketing activities to adequately improve the image of the territory.

It should be noted that the mechanisms for implementing priority territorial transformations are basically a set of actions and activities that formalize life activities aimed at the development of territories of a certain class, carried out in the form of program-territorial planning, urban development zoning, land planning, architectural and civil engineering, construction, major renovation, and reconstruction of capital construction objects.

Land planning (LP) is one of the most important constituent elements of the mechanism for implementing priority territorial transformations.

As a process, LP sets parameters of location and interaction, both of objects of local significance and those of municipal, regional, and federal significance, with reference to the existing objects of functional zoning, in order to ensure sustainable operation and development of the respective f-areas. The interdependence between a favorable living environment and sustainable development of a territorial entity development is undeniable.

Such a combination restricts adverse impact on the environment, evolving in the course of economic activity, due to a deep understanding of the importance of natural resource conservation for future generations.

A system-dynamic model of marketing mechanisms for managing the development of municipalities elaborated in the course of the study is based on the principles of sustainable territorial development and allows for evaluation of control actions determined by the administration and the supervisory board of a territory to reduce a negative spatial polarization of socio-economic development indicators.

Without striking a balance of interests between business figures, population, and authorities it is impossible to ensure the state of sustainability and further territorial development.

Such unity is possible only subject to a concept of strategic development of a territorial entity, based on solving a three-pronged managerial task within the framework of the previously reviewed strategic lines: goals for socio-economic development parameters, goals for the state of investment activity, and goals for creating an advantageous image.

The marketing objective is to substantiate the specifics of goals in these areas and to provide options to the territorial governance for them to subsequently select an option, taking into account the emerging political realities for the given territory.

To ensure these processes, the potential of a territory is one of the major factors determining the degree of achievement of strategic development goals.

In this regard, these processes are considered in the framework of testing the system-dynamic model for transforming the existing potential into usable resources (see Figure 5). Reproduction of the potential that provides resources for the next development cycle of a territory is a result of operation of the functional areas in a territory within the framework of the system-dynamic model. Socio-economic assessment of the state of a territory in the current context takes the form of a system study of the life activity of the territory in order to identify key problems and search for reserves to increase the level of the territory’s SED.

The economic processes in functional areas, socio-economic efficiency and the outcomes of their activities, which are formed under the influence of objective and subjective factors that find objective reflection through the system of socio-economic information, are a subject of such research. Table 1

## 4. RESULTS AND DISCUSSION OF THE STUDY

According to the authors, a key role in balanced operation of the functional areas of a territory should be played by territorial marketing.

The process of its implementation can be quite complicated, since it requires a solid professional background and, accordingly, qualification, as well as some researcher intuition. For example, when stating the problematic issue of agricultural marketing, it is advisable to consider it in a broad sense, that is, including agro-industrial products as an element of the agro-industrial complex (AIC) of a given territory, since the AIC is a set of sectors of the national economy related not only to the development of agriculture but also to its maintenance and bringing agricultural products to the consumer. From this standpoint, a solution that would give reasonable answers to the fol-lowing questions is the main objective of agricultural marketing (Schumpeter, 1982;Ashby, 1966;Ismail et al., 2017):

• - what agricultural or AIC products the consumers in this territory would need;

• - what intellectual and physical resources, with possible involvement of partners from other territories, can be used to develop technologies and to manufacture territorial products;

• - how and where the products of this territory should be sold;

• - by what means it is expedient to promote the products of this territory.

To answer the questions above, calculations of marketing indicators over several years are to be thoroughly analyzed in order to identify both the dynamics itself and the emerging trends in the indicator of agricultural production per capita in a given territory. In this case (according to paragraphs 14.1 and 2.2 of the reference book Regions of Russia, hereinafter referred to as RR), a positive trend of the indicator (the ratio between the territory to the reference) of its total agricultural output from 2012 to 2015 increased by 51.3%.

At the second stage, the state of the territory is studied in order to identify effective indicators and parameters specific to the operation of the agro-industrial complex in the territory:

• 1) The main goal of the agricultural area in the territory (ACAT) is not only provision of food resources; while it is difficult to predict it in the long term, it is necessary to determine a set of activities (what exactly the agricultural area in the territory does or can do in the future).

• 2) To determine markets where a company in the agricultural area in the territory operates or may operate, in particular, for what kind of products the agricultural area in the territory has the highest resource and/or industrial potential.

• 3) Staffing analysis that includes analyzing the staff composition and qualifications by groups of territorial products.

• 4) Analysis of supply and distribution channels.

• 5) Assessment of the available and projected machinery and equipment fleet, as well as a possibility of its development.

• 6) Investment needs and options for implementing investment opportunities.

The third stage involves studying the factors of external environment that under certain conditions can affect the ACAT development:

• 1) Political factors determining the development strategy of the territory, development strategies in sectors and branches of economy, as well as a possibility to secure investment from sources from outside the territory in principle.

• 2) Economic factors causing the possibility of providing ACAT with budgets at different levels, funds and enterprises.

• 3) Production factors forming sectors and production of potential consumers of ACAT products, production partners, and resource partners.

• 4) Scientific and technological factors that allow for selection of competitors and partners when creating new production technologies.

In practice, an analysis can begin with determining the production volumes of AIC food products, taking into account the recommendations of the Ministry of Public Health of the Russian Federation No. 614 of August 19, 2016, on rational norms of food consumption that meet current requirements for healthy nutrition (Table 2). To search for promising areas that would meet the estimated needs of the territory, let us use an additional matrix (see Table 3), its column headers containing agro-industrial branches operating in the territory in question, and the rows display ACAT parameters that show its market advantages.

This approach is based on the following considerations.

Firstly, the agricultural area in the territory in the AIC structure is a controlled object, for which case problems are not only poorly formalized but also poorly struc-tured.

In such problems, some of the cooperating elements may not depend on a decision maker (DM) (such as the weather, crop forecast, legislation amendments, etc.), some other hinge on the decision maker, bypassing the associated factor chains, while the others depend on the decision maker only partially. Table 4

Secondly, parameter values in a case problem are not obtained by means of objective measurements but by interviewing experts; therefore, they appear to be variations of their subjective evaluations.

Thirdly, the system of factors and relations between them cannot always be determined with sufficient completeness, which brings incertitude in the process of setting control tasks. Fourthly, pre-formulated alternatives for such situations are simply absent at the beginning and later arise in the course of deepening research processes.

In course of decision making in the agro-industrial complex problems in certain situations, such short-comings prevent from relying on the use of reputed simulation methods involving the use of objective quantitative estimates, approaches used in the traditional decision-making theory based on selecting an alternative from a list of well-defined alternatives, as well as well-known scenario analysis methods.

On that ground, the “template” prepared by the authors is based on taking into account system factors in poorly structured problem areas, such as the agricultural area in a territory, represents the possibility of experimental use of the Blockchain technology to control agricultural production flows in a particular territory.

The use of the Blockchain technology determines mutual trust among stakeholders due to the transparency and visibility of any transaction transformation.

Thus, in essence, this is basically an innovative information paradigm where the stakeholders do not need to build a special relationship, since the transparency of transactions and visibility of information is inherent in the system, while interaction is ensured by “smart” contracts, whereby any anomalies associated with the human factor are minimized.

The use of Blockchain in the marketing management of AIC products in a territory: general concept.

The supply chain of AIC products of a territory involves a list of elements of the resources involved in the processes: labor resources, tangible assets, knowledge, processes, and contracts that basically ensure a product flow from a supplier to a customer (Tyapukhin, 2015). From the standpoint of territorial management, it is rather difficult to keep track of all transactions between all the participants in a chain.

These data are usually stored in several locations and are available to certain system users.

The Blockchain technology can significantly improve the transparency and traceability of any flow in a supply chain by using unchanged data, distributed storage and controlled user access to the information system.

This paper proposes a distributed information support system for management of the agro-industrial complex in a territory (AIC DISS), which uses the Blockchain technology to collect, process, and organize storage and management of important data about each product from the agricultural area in a territory throughout its life cycle.

Distributed information sections make it possible to form key records about transformations of a particular product, as well as to track event-driven processes for products. Information on this issue is available to all the participants in a chain at the same time.

A case model of the Blockchain distributed information system in the marketing management of an agricultural area of the “country” class territory is presented in Figure 6.

This approach involves implementation of the system elements of a structured scheme where Blockchain is tested to collect, to process and to manage information about a particular product throughout its life cycle.

While a product is moving from one scheme element to another one, the product is intended for everyone else, which may include suppliers, manufacturers, distributors, retailers, and end consumers. In this case, the above element plays an important role in the system and normally complements the product description in its profile with data on the current status of the product in Blockchain. Thereby, each product has a digital profile that integrates data entered at various stages of the product life cycle. The proposed AIC DISS structure consists of four groups of elements:

• Registrars, which are organizations that ensure unique identification of each elementary participant in the network.

• Certification organizations, which are organizations that develop standards for working with Blockchain and certify the other elementary participants.

• Manufacturers, distributors, retailers, processing organizations, which are elementary network participants who enter data related to products in Blockchain.

• Consumers are ultimate buyers of a product; in some cases they also enter product data into the Blockchain.

In the Blockchain system, an information code is assigned to each product, usually it is a bar code, a QR code or an RFID tag. Such a binding is a unique digital cryptographic identifier that serves to combine a physical elementary product with its virtual “identity” in the Blockchain structure. This reflection is also part of a product profile.

Elementary participants in this structure also have digital profiles assigned to them during the registration with the Blockchain structure.

These participants’ profiles contain the following information: the participant data, their location, certificates, and product type the member has taken an interest in. The availability of information about the participant can be adjusted for the rest of the structure participants, and a participant can be completely anonymous but only subject to the respective certificate confirming the reliability of their activities.

Registrars are organizations that provide access to the Blockchain subscribers in the product promotion structure; they ensure the unique significance of each participant in the structure. For each participant registered, a pair of cryptographic “keys” – of a closed and open type – is compiled. A login key, which is a public key, serves as a participant’s identifier in the network, and a private key serves to verify a participant’s authenticity when dealing with the other participants in the Blockchain structure.

This approach allows each element in the structure to receive an electronic signature from a particular partici-pant as this element advances in the structure. Data exchange in the Blockchain structure occurs on the basis of software developed by parties in charge of the respective active element. Then, subsequent to careful consideration of details, such software is installed on the computers of respective participants.

The issue of consumers is considered separately, since special software with a special interface is released for them; it provides access to product data required for a specific consumer. The system software records new data on new products or adds data to the existing records.

In essence, the source code for such Blockchain platforms is mutable, and its operation principle can usually be modified, for example, as already implemented in the Blockchain Euthereum project.

The organization of access to data and their distributed storage is already programmed in the Blockchain structure and cannot be arbitrarily altered by one participant, without confirmation from all the others.

The use of Blockchain technology in managing supply processes: data entry. Each physical product as part of the proposed distributed information system Blockchain must be presented on the network in the digital form so that all the stakeholders have direct access to its data. It is required for making transactions and instantly updating product information through its life cycle.

Data can be entered both manually and through direct transfer of information from a product label to the system by scanning.

The data in the proposed system can be classified as:

• Property data is a chronological list of all the product owners, including the current one. Each time an exchange occurs between two supply chain members, a new transaction record is created and added to the product profile. Thus, each specific transaction relates to one or another digital identity of a chain participant in Blockchain, which allows the system to understand which participant has the right to enter data in the product profile at the moment.

• Time data; every time a new record is created in a product profile, the system automatically records the date and time of this new record, providing the chronology of product profile modifications.

• Location data indicate where a product is located now and where the last entry in its profile was made. Since the system contains data on the location of supply chain participants, a product may be assigned a location identifier or GPS data to track its movement.

• Product data (specification) is all the information related to a product: its manufacturer, date of manufacture, description, etc.

There are certain difficulties, both objective and subjective, in using the Blockchain distributed information system:

• Technological barriers, that is, the need for a large number of computing and supporting equipment and continuous software development; low rate of information unit distribution.

• Conservative public perception that tends to link this technology with the shadow market or a dubious type of business.

• The complexity of developing, implementing and rebuilding business models, there is a need to “break” the conventional thinking pattern and switch to a new information concept. It is also difficult to take into account the interests of all stakeholders.

## 5. CONCLUSION

The research of processes aimed at improving the quality of managing the fragments of life activity in territories has allowed for the following conclusions:

1. Even an agricultural functional area of a territory considered in the case study in isolation from the other areas is an image of a large system. Consequently, the description of such an area should also be based on such core concepts for the general theory of systems as organization, information, and goal. A distinctive feature is that in addition to the dimension of an agricultural functional area of a territory, it is dominated by the complexity of its structure, defined by interaction of heterogeneous elements: natural, living, social and technological systems. At the same time, such area development must take into account a balance required for holistic structure operation of all the functional areas.

2. The developed system-dynamic model is a tool to model the reproduction of potential that provides resources for the next cycle of territorial development. Socio-economic assessment of the state of a territory in the modern context is becoming a system research into the life activity of a territory in order to identify key problems and search for reserves to improve the level of socio-economic development of the territory. Managerial, activity, industrial and environmental processes in functional areas, their socio-economic efficiency and the outcomes of their activities, which are formed due to objective and subjective factors that find an objective reflection through the system of socio-economic information, are the subject of such research.

3. The paper presents an organization support mechanism for a target program aimed at improving the investment activity in the functional areas of a territory, which is based on solving three managerial tasks: modeling of risk situations in investment processes; selection of target segments of territorial products for investment; assessment of the organization level of the territory, which allows for an analysis of the ongoing economic processes in the functional areas of the territory, for a projected timeline for its further territorial development, and for adjustment of control actions of the social and business area, taking into account the socio-economic response of the territory.

## Figure

Functional areas of a territory.

The set of structures that determine SBA operation.

Overall scheme of correlation between SBA management and marketing in a territory.

Management structure of priority territorial transformation implementation mechanisms.

System-dynamic model of territorial development.

Case model of Blockchain use in managing a functional agricultural area in a territory.

## Table

Territory of the Russian federation, 2012

Annual food ration per capita

Auxiliary ACAT provision matrix

Marketing assessment of ACAT provision

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