An Electronic Market of Individual Human Competencies for Team Building

In the past few years virtual enterprises have been discussed intensively in science and practice as a new form of cooperation. Early experiments with virtual arrangements show a superiority of virtual enterprises with respect to flexibility and the ability to react quickly to market demands when compared to cooperation forms prevailing today. Still, the discussion is mainly confined to a phase where a virtual enterprise already exists. For this reason a wide range of problems is not handled enough in detail. For example, there are no suitable scientific concepts for finding partners to establish a virtual enterprise. Likewise, research is also needed to better understand the structured procedures in the initialization, implementation and termination of virtual enterprises. It must be ensured that a virtual enterprise has a uniform appearance vis-à-vis its customers, that the customer is always informed about the current state of the output development process and that a specific contact partner is constantly available to the customer. In this paper, cooperation exchanges are analyzed as an approach for solving the abovementioned problems. These exchanges facilitate a flexible association of partners and customers in virtual enterprises by means of providing suitable methods and tools. To begin with, a framework concept of the architecture of a cooperation exchange is described and the individual components of the architecture are introduced. Based on this framework concept, the prototypical implementation of an electronic cooperation exchange is presented, which operates dynamically on the Internet with so-called web agents. 1 Cooperation Form "Virtual Enterprise" 1.1 Definition The adjective "virtual" characterizes the property of an object that does not really exist, but appears to exist. Applied to an enterprise, this means that it does not actually exist, however appears to be one enterprise to the customer. Virtuality is achieved through the cooperation of independent enterprises, which together realize the complete field of goods and services. Each enterprise realizes in this connection only one special part of the value chain. Byrne, Brand und Port understand a virtual enterprise as "a temporary network of independent companies suppliers, customers, even erstwhile rivals linked by information technology to share skills, costs, and access to one another's market. It will have neither a central office nor organization chart. It will have no hierarchy, no vertical integration."[Byrne/Brandt/Port 93] In general, a loose union of the different enterprises is demanded in addition to these characteristics. [Scholz 96] Newsletter Vol. 1, No. 3 virtual-organization.net 14 Virtual enterprise partners are better positioned to use emerging market opportunities to their advantage. They maintain their virtual association only as long as they achieve a higher profitability than in their own enterprise or in another cooperative arrangement. [Goldman/Nagel/Preiss 95] It is the primary aim of a virtual enterprise to make use of the synergy which arises from the union of the partners. But at the same time, a maximal flexibility must be guaranteed for the virtual enterprise as well as for the partner enterprises. The advantages of virtual enterprises are especially well-founded by the following points: • The collection of complementary core competencies enables the implementation of projects as well as the production of outputs which none of the partners could realize as a single entity. • The entrepreneurial risks and resource costs, in particular for personnel and technology, are distributed among the partners. • Through the partners’ joint and/or complementary business processes, and the diminishing of costs for production, infrastructure, and knowledge, it is possible to reduce the time span between product development and commercialization. • By participating in virtual enterprises the market entry barriers for enterprises are decreased. 1.2 Problem Areas The discussion of virtual enterprises has an increasing effect in initiating the development of new approaches for solving specific economic problems.[Benjamin/Wigand 1995] However, dealing with the topic clearly shows that some problem areas have not yet been addressed satisfactorily: • The common basis of 'trust' as a foundation for cooperation depends on a profound 'culture of trust'.[Scholz 1996] Trust-based relationships can only be developed over a longer period of time, which is contradictory to the temporary structure of virtual enterprises. • Virtual enterprises rely on loose forms of contracts which can quickly be realized, e.g. electronic contracts.[Byrne/Brand/Port 1993] To date, there are few legal possibilities for such contractual forms. Thus, questions of legal liability and the granting of warranties have not yet been considered satisfactorily.[Szyperski/Klein 1993] • The virtual enterprise concept also implies that one enterprise may participate in multiple virtual enterprises. This increases the possibilities for conflict-of-interest situations, which may have a degrading impact on other trust-based relationships. • The costs associated with coordinating the partners cannot be precisely estimated. Hence, there are no definitive research results on the scope and magnitude of the transactions costs associated with coordinating virtual organizations. • Procedures for searching for partners present another area which merits additional consideration. If there is a lengthy search for partners, it not only results in high costs, but also the timeto-market for new and innovative products is prolonged. These problem areas must be addressed before the virtual enterprise concept can gain wide acceptance. Through a framework for the architecture of a cooperation exchange, the extent of which a contribution to solving some of the previously discussed problem areas can be made, should be examined. Exhaustion of the existing improvement potential is expected, especially when using the cooperation exchange for partner search and coordination. The realization of an electronic cooperation exchange serves in the evaluation of the architectural concepts and the achievement of new results in practice. Newsletter Vol. 1, No. 3 virtual-organization.net 15 2 Framework for the Architecture of a Cooperation Exchange The cooperation exchange for the continuous design of virtual enterprises should enable the flexible association among partners and customers in virtual enterprises through the provision of suitable methods and tools. The cooperation exchange offers a communication and coordination forum for all participants. Participants in a cooperation exchange are defined as enterprises who wish to participate as partners in a virtual enterprise. However, a virtual enterprise cannot only be initiated by a partner with an innovative idea for a new product, but also by the demands of a particular customer. For this reason customers are also participants in a cooperation exchange. Due to its complexity, the architecture of the cooperation exchange is subdivided into several components. On the one hand, they determine the management of the cooperation exchange, and on the other hand, they guarantee support for the participants in the cooperation exchange. Figure 1 shows the conceptual structure of the cooperation exchange. [Hoffmann/Hirschmann/Scheer 96] Process Models Participants Customers Virtual Enterprise Cooperation Exchange Potential Partner Enterprises Architecture Components