Virtual Organisation

Paradigm shift to virtual organization

1. Virtual Organization ATIENZA, FRANCIS FAJARDO, ROLAND

2. Virtual Organization An organization involving detached and disseminated entities (from employees to entire enterprises) and requiring IT to support their work and communication. used to describe a network of independent firms that join together, often temporarily, to produce a service or product. Also known as virtual office, virtual teams, and virtual leadership. Virtual organizations do not represent a firm’s attribute but can be considered as a different organizational form. The ultimate goal of the virtual organization is to provide innovative, high-quality products or services instantaneously in response to customer demands.

3. Virtual Organization Consists of individual's working out of physically dispersed work places, working from mobile devices. ICT is the backbone of virtual organization. ICT coordinates the activities, combines the workers’ skills and resources with an objective to achieve the common goal set by a virtual organization.

4. Apparition and Evolution 1980 The emergence of outsourcing in the 80s unquestionably played a significant role as its aim is to eradicate unproductive internal services and transfers the difficulty outside of the organization. 1990 First utilized in the early 1990s as demonstrate the work of Jan Hopland, Roger N. Nagel, William H. Davidow and Malone. Emerged in 1990, it is a social network in which all the horizontal and vertical boundaries are removed becoming boundary less organization.

5. Companies engaged in Virtual Organization

6. Working of a Virtual Organization Security Agency R & D Agency Transportation Manufacturing Firm Material Suppliers Financial Institution Central Organization

7. Technology required Internet World Wide Web EDI Telecommunications  E-mails Groupware Video Conferencing

8. Characteristics of Virtual Organization Flat organization Dynamic Informal communication Power flexibility Multi-disciplinary (virtual) teams Vague organizational boundaries Goal orientation Customer orientation Home-work Absence of apparent structure Sharing of Information Staffed by knowledge workers.

9. Advantages of Virtual Organization Eliminates physical boundaries. Cross-functional teams and organizations operates via electronic channels. Allow business to sell and deliver product across the word in most efficient ways. Greater business opportunities. Better integration of suppliers and vendors. Better management information. Lower operational costs. Better market understanding. Expanded geographical coverage.

10. Disadvantages of Virtual Organization Less commitment of members on account of not being involved physically. Members are often not able to work as a team creation and management of team is often difficult. Virtual organization often are not economical to constitute Less commitment of members on account of not being involved physically. It may not be possible to develop mutual trust between the member firms in a virtual organizations. The staff of some member firms may find it difficult to adjust to the virtual arrangement.

11. Types of Virtual Organization Tele-commuters Permanent Virtual Organizations Outsourcing Employees/ Competencies Completely Virtual Organizations

12. Types of Virtual Organization Telecommuters - These companies have employees who work from their homes. They interact with the work­place via personal computers connected with a modem to the phone lines. Examples : Dow Chemicals, Xerox, Coherent Technologies Inc., etc.

13. Types of Virtual Organization 2. Outsourcing employees/competencies - characterized by the outsourcing of all/most core competencies Areas for outsourcing include marketing and sales, human resources, finance, research and development, engi­neering, manufacturing, information system, etc. In such case, virtual organization does its own on one or two core areas of competence but with excellence. For example, Nike performs in product design and marketing very well and relies on outsources for information technology as a means for maintaining inter-organizational coordination.

14. Types of Virtual Organization Completely Virtual - These companies metaphorically described as companies without walls that are tightly linked to a large network of suppliers, distributors, retailers and customers as well as to strategic and joint venture partners. Atlanta Committee for the Olympic Games (ACOG) in 1996 and the development efforts of the PC by the IBM are the examples of completely virtual organizations.

15. Types of Virtual Organization 4. Permanent Virtual Organizations - designed from its inception, as a virtual organization to bring together market players and respond to opportunities for both improved revenue generating activities as well as cost savings.

16. NEW BUSINESS FORM

17. NEW BUSINESS FORM The virtual corporation is more permeable than traditional organizational forms. Interfaces in a virtual organization between company, supplier, and customers continuously change, resulting in a blurring of traditional functions. Inside the office, work groups and job responsibilities may shift regularly. The virtual organization may not have a central office or an organizational chart. Suppliers, customers, and even competitors may spend time alongside one another in the virtual organization.

18. Virtual Teams "a group of people who interact through interdependent tasks guided by a common purpose.” a virtual team performs work across space, time, and organizational boundaries connected by interactive communication technologies. Virtual teams may include employees, management, customers, suppliers, and government working together to achieve common goals. These teams often stay together only to perform its episodic task. They may work jointly on a new project, but when the product is designed and goes into production, the project is finished and the virtual team dissolves.

19. Characteristics of a Virtual Team Learn a new set of skills. One skill is the ability to interact with one another effectively despite infrequent or total lack of face-to-face contact. Ability to assimilate quickly and effectively into new teams. Virtual team members should be technically adept to deal with the variety of required computer-based technologies. virtual team members may need intercultural skills to work effectively in multi-national organizations.

20. Virtual Leaders Ability to manage a network of interdependent firms. To design virtual operations To create and sustain virtual relationships with internal as well as external constituents To support virtual teams, and to keep virtual teams focused. The leader of a virtual organization demands a new set of skills unlike the skills required in a traditional hierarchy.

21. Virtual Learning Ability of the organization to create world-class learning systems. These learning systems help leaders sustain or create world-class competencies. Effective learning systems can create pathways throughout the organization, in network fashion, enhancing the innovative capabilities of the organizational members. An organization's ability to sustain a leadership position in the world economy demands that organizations be on the cutting edge to develop rapid and elegant solutions to emerging consumer demands.

22. Challenges Strategic planning dilemmas, boundary blurring, a loss of control, and a need for new managerial skills. Strategic planning poses new challenges as virtual firms determine effective combinations of core competencies. Common vision among partners is quintessential to cooperating firms. Focused on a common goal, firms develop close interdependencies that may make it difficult to determine where one company ends and another begins. The boundary-blurring demands that these boundaries be managed effectively. Coordinating mechanisms are critical elements for supporting these loose collections of firms.

23. Challenges Virtual structures create a loss of control over some operations. This loss of control requires communication, coordination, and trust among the various partners, as well as a new set of managerial skills. Employees are exposed to increased ambiguity about organizational membership, job roles and responsibilities, career paths, and superior-subordinate relationships. This ambiguity requires management to rethink rewards, benefits, employee development, staffing and other employee-related issues. Developing leaders who are able to create and sustain these organizational forms is critical.

24. Researches According to the study, in order to succeed in a V.O., workers need to trust one another. The higher the degree of trust, the more communication will occur between virtual workers. Active communication and a high level of trust can lead to collaborative learning.

25. Researches Adoption of virtual organization, provide means to implement innovative organization structures. The adoption and diffusion of virtual organization might transform firms to meet the demands of e-commerce

26. Researches An assessment of the data resulted in important commentary about the behavior, skills, and attributes of flourishing leaders in virtual organizations. The study found persuasive confirmation that various bundles of characteristics comprise leadership attributes exhibited by successful project management leaders in virtual organizations. Interconnecting themes included technology, communication, and people skills.

27. REFERENCES: Colky , Deborah Lavin (2002). A critical examination of the virtual organization and the mutual dependencies of Trust, Communication, and Collaborative Learning. ProQuest Dissertations Publishing. Lin and Lu (2005). Adoption of virtual organization by Taiwanese electronics firms: An empirical study of organization structure innovation. Journal of Organizational Change Management, Emerald Group Publishing Ltd. pp. 184-200 Vol. 18 No. 2. 2005 Musil , Elisabeth (2014). Leadership Attributes for the Virtual Environment: A Qualitative Study. ProQuest Dissertations Publishing. https://www.referenceforbusiness.com/management/Tr-Z/Virtual-Organizations.html https://en.wikipedia.org/wiki/Virtual_organization http://www.yourarticlelibrary.com/organization/what-is-virtual-organisation-definition-characteristics-and-types/35533