The Functionality of Virtual Organizations

The objective of this paper is to study, how well the new organizational forms called virtual organizations are functioning. The ultimate purpose is to develop a more coherent theoretical account of virtual organizations and their various forms, e.g. teams, companies and networks. The practical aim is to develop bases to analyse and model virtual organizations. In the first chapter, reasons for the emergence of virtual organisations are discussed. The second chapter deals with the background of virtual organizations, the concept ‘virtual organization’ is defined, and different forms of virtual organizations as objects of the study are described. The third chapter summarizes some empirical findings concerning virtual organizations including three own case studies. Advantages, disadvantages and some managerial implications are presented. And finally, questions are dealt, what to study in virtual organizations, and how to study them empirically. This review is based on selected written material and on three own case studies.