Methods for reducing production costs at Russian defense industry enterprises

S. S. Golubev ()

Russian Journal of Industrial Economics, 2026, vol. 19, issue 3

Abstract: The article examines efforts to reduce production costs at Russian defense industry enterprises amid growth in the state defense order, sanctions pressure, and the need to ensure production volumes, product quality, and manufacturability simultaneously. Cost reduction in the defense industry is shown to be not only an economic objective but also a strategic task directly related to enterprise resilience, management efficiency, and the fulfillment of government obligations. An analysis of practices at Russian defense industry enterprises identified the key areas for reducing costs: improving organizational management; introducing rigorous project management and end-to-end planning; scaling up production; developing integrated management systems; conducting technological audits; modernizing equipment; applying lean manufacturing tools, digital modeling, and digital twins; and improving workforce competency management. Particular attention is paid to the transformation of pricing approaches under the state defense order, whereby cost savings become a source of additional profit, investment, and technological development. The article concludes that sustainable production cost reductions at defense industry enterprises can be achieved only through a systematic combination of organizational, technological, workforce, and financial measures.

Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ach:journl:y:2026:id:1664

DOI: 10.17073/2072-1633-2026-3-1664

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