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virtual organisation

. Benjamin and Wigand (1995) state that ‘ it is becoming 

increasingly diffi  cult to delineate accurately the borders of today’s organisations ’.  Electronic 

networks make it easier to outsource aspects of the production and distribution of goods 

to third parties (Kraut  et al  ., 1998). This can lead to the boundaries between supplier and 

organisation becoming blurred. Employees may work in any time zone and customers are 

able to purchase tailored products from any location. The absence of any rigid boundary or 

hierarchy within the organisation should lead to a more responsive and flexible company 

with greater market orientation. 

 Virtual organisations can also be viewed as a way of transforming existing organisations. 

Malcolm Warner has defined a virtual organisation, in this context, as follows: 

  Put simply, it is an organisational form that enables companies to reduce their physical 

assets (large headquarters, centralised plants and so on), relying instead on small decen-

tralised units linked by a strong communications network. In other words, the old physical 

constraints of the plant and office building are broken down, and activities of co- ordination 

and control, which used to take place face-to-face, are now handled remotely ‘over the 

wire’. (Warner, 2001)  

 He suggests that companies are experimenting with different characteristics of virtual organ‑

isations, including: 

   

● 

   Lack of physical structure : virtual organisations have little or no physical existence.  

  

● 

   Reliance on knowledge : the lack of physical facilities and contacts means that knowledge is 

the key driving force of the virtual organisation.  

  

● 

   Use of communications technologies : it follows that virtual organisations tend to rely on 

information  technology.  

  

● 

   Mobile work : the reliance on communications technologies means that the traditional 

offi  ce or plant is no longer the only site where work is carried out.  

  

● 

   Boundaryless and inclusive : virtual companies tend to have fuzzy boundaries.  

  

● 

   Flexible and responsive : virtual organisations can be pulled together quickly from dispar‑

ate elements, used to achieve a certain business goal and then dismantled again.   

 An alternative viewpoint on features of a virtual organisation (Kraut  et al. , 1998) is: