IPE technology

Institutional engineering is the basic technology of IPE Laboratory.
Institutionalism is the theory of ownership, its institutions, institutional transactions and costs generated by them. The conceptual apparatus is presented in the works of Durkheim, Weber, Marx, Veblen, Commons and Coase. Today, institutional theory is experiencing the peak of development, becoming a mainstream. IPI Lab is among the companies that are at the forefront of implementation of institutional models in the engineering practice.
What is the institutional engineering?

— development and evaluation of investment plans;

— systematic analysis of social and economic institutions and their impact;

— assessment of the prospects for the project development with the identification of costs, risks and uncertainties;

— providing technological, organizational and legal and functional implementation of prospects;

— creating the effective structure of the project;

— the implementation of projects based on leading standards and practices;

— the formation of chains in the economy, through the evaluation of performance indicators.

We combine leading practices with our own innovation, providing for their maximum efficiency.

Why is institutional engineering effective?

In developing the project, the entrepreneur seeks to take into account and promote success factors. But being a professional in a narrow range, he/she is simply not able to use hidden resources. Institutional Engineering detects and includes mechanisms that ensure the success of the project. IE allows analyzing the economic categories and processes, and exploring the impact of social, political and economic institutions.

Political instability, the acceleration of scientific and technological progress, and increased competition have become familiar components of life. The effectiveness of investment in such conditions is rapidly falling. Business survival depends on the quality of management decisions. Institutional engineering is designed to reduce the risks and increase the «survival» of projects.

Today, developed countries invest in projects up to 40% of GDP. For example, in the USA the figure is 40%, and before the 2008 crisis it was 60%. A large proportion of the financial sector in the economy is necessary to compensate for the high risks, which as a result gives an idea about the level of transaction costs in the economy.

The current economic situation in the world is tempting to think that the problems lie in the root of the system. It is time to recognize that the current approach to doing business does not meet the realities and demands conversion.

Impact Investing is the only way out of this situation. IPI Laboratory is the first organization in Russia that studies and creates technologies in the industry. The IPI Lab professionals adapt the world experience and achievements of the impact investments to be implemented in Russia. Please find out case studies, research papers and publications about Impact Investing.

* Impact Investing is the investing of capital in enterprises, companies, organizations and projects to generate income, and achieve social and environmental effects. Since 2007, this approach has been used in the West, and is gradually spreading throughout the world. The essence of the Impact investing is the avoidance of consumerism. Achieving universal well-being is the only way to preserve the integrity of the economy and society.

Transformation investments

In developing the project, the entrepreneur seeks to take into account and promote success factors. But being a professional in a narrow range, he/she is simply not able to use hidden resources. Institutional Engineering detects and includes mechanisms that ensure the success of the project. IE allows analyzing the economic categories and processes, and exploring the impact of social, political and economic institutions.

Political instability, the acceleration of scientific and technological progress, and increased competition have become familiar components of life. The effectiveness of investment in such conditions is rapidly falling. Business survival depends on the quality of management decisions. Institutional engineering is designed to reduce the risks and increase the «survival» of projects.

Today, developed countries invest in projects up to 40% of GDP. For example, in the USA the figure is 40%, and before the 2008 crisis it was 60%. A large proportion of the financial sector in the economy is necessary to compensate for the high risks, which as a result gives an idea about the level of transaction costs in the economy.

The current economic situation in the world is tempting to think that the problems lie in the root of the system. It is time to recognize that the current approach to doing business does not meet the realities and demands conversion.

Impact Investing is the only way out of this situation. IPI Laboratory is the first organization in Russia that studies and creates technologies in the industry. The IPI Lab professionals adapt the world experience and achievements of the impact investments to be implemented in Russia. Please find out case studies, research papers and publications about Impact Investing.

*Impact Investing is the investing of capital in enterprises, companies, organizations and projects to generate income, and achieve social and environmental effects. Since 2007, this approach has been used in the West, and is gradually spreading throughout the world. The essence of the Impact investing is the avoidance of consumerism. Achieving universal well-being is the only way to preserve the integrity of the economy and society.

The origins of the engineering approach

Elements of engineering approach had been arising in practice of major US investment banks and consulting firms. In 1990, McKinsey & Company analysts summed up the experience in the first monograph dedicated to cost management ( «Valuation: Measuring and Managing the Value of Companies»).

In 1991, an analyst at Morgan Stanley holding J. Finnerty introduced the concept of «financial engineering». As the crisis of 2008 showed, the previous approaches had discredited themselves. They were replaced by a new trend, called Impact Investing.

Harvard guru Michael Porter solemnly declares that this trend, crowned by the Blended / Shared Values ideology, «will develop the idea of the «invisible hand» of Adam Smith», «will become one of the most powerful factors in the global economy», «will lead to a revolution in the business outlook», and as a whole «change the essence of capitalism.»

Fundamentals of theoretical foundations of IE — Property Management — are set out in a series of analytical notes to the Soviet leadership, written by the «S.Platonov» group. In December 1983, a report to Yuri Andropov had been created, the proceedings of which were published in 1989 in the book «After Communism». Ideas about the IE mathematical apparatus were described in 1993 in the monograph of S.B. Chernyshev «Meaning. Periodic system of its elements».

In 1998 the IE methods and standards were applied in the Higher School of Economics. In 2001 — in the system of design workshops of the Center of Corporate Entrepreneurship. In 2011 — on the basis of MIPT.

How does IPE Lab apply the institutional engineering?

Since 2012, IPI Lab headed by A.N. Pakhomov has been developing the institutional engineering tools. The Scientific Board headed by S.B. Chernyshev is occupied with the theoretical studies.

The activity of IPI Laboratory is based on a combination of 3 components:

— the research work on the basis of existing practice,

— the international investment practices (more than 20 years of experience),

— the consulting technologies with the successful experience of using for over 10 years.

IPI Lab is a part of the international network — Global Impact Investing Network.

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