Strategic Institutional Diversification Model (SMD): transformation, sustainability and growth in public companies
Keywords:
Public enterprises, strategic diversification, financial sustainability, public governance, institutional innovationAbstract
Financial sustainability and public value generation represent structural challenges for public enterprises in contexts characterized by budgetary constraints, digital transformation, and increasing citizen demands. This research aimed to develop a legal-managerial strategic diversification model focused on strengthening institutional transformation, financial sustainability, and organizational growth within the framework of the principle of legality and the new public management. The legal issue addressed consisted of determining the extent to which public enterprises may diversify their business lines without undermining their institutional purpose or violating the principles governing public administration. A qualitative methodology with a dogmatic, analytical, and propositional approach was applied, supported by normative, doctrinal, and comparative analysis of the legal regime of public enterprises and contemporary strategic management models. As a result, the Strategic Institutional Diversification Model (SIDM) was developed, structured around four pillars: institutional core, functional expansion, complementary diversification, and financial sustainability. The findings demonstrate that legally aligned diversification strengthens financial autonomy, organizational resilience, and public value generation.
Keywords: Public enterprises, strategic diversification, financial sustainability, public governance, institutional innovation.
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