Virtual Corporations

Abstract

At the end of the 20th century, many authors tried to predict what new structures companies would be likely to adopt in the 21st century. Now, in the 21st century a clear tendency is emerging: the virtual organization (Agrawal & Hurriyet, 2004; Alsop, 2003; Bekkers, 2003; Camarinha-Matos & Afsarmanesh, 2005; Heneman & Greenberger, 2002; Lee, Cheung, Lau, & Choy, 2003; Talukder, 2003; Vakola & Wilson, 2004). This type of organization offers the most promising response to an increasingly complex business reality. In this respect, current organization theory is beginning to change its focus to new, flexible, and virtual organizational forms. This article is organized as follows: The background section defines different concepts of virtual organization. The first model equates the virtual corporation to a temporary network of firms that quickly comes together to exploit temporary market opportunities. The second model focuses on the manufacture of virtual products by means of stable and trusting relationships with suppliers and customers. The third model of virtual corporation tries to turn the fixed workforce costs into variable costs. The third section points out the shared characteristics of this type of organization and the role of the manufacturing function, information and information technology, the network structure, and a new type of worker. The final sections discuss future trends and our conclusions.