Design and implementation of virtual organizations

The current literature on virtual organizations describes a richness of different aspects that contribute to the emergence of this new organizational form, like customer orientation, the use of information and communication technology (ICT), and time-based competition or decentralization. However, there seems to be one common theme in this literature: “virtual” organizations are frequently (re-)created, sustained to capture the value of a market opportunity, and dissolved again to give way for the creation of the next virtual organization. This paper therefore approaches the concept of the virtual organization from the organizational routines or design processes which drive the design and implementation (D&I) of the virtual organization. As a step towards a conceptual theory, the article contributes a model of D&I processes for virtual organizations in order to contribute to the study of such organizations. It does so by summarizing eight propositions from earlier literature and empirical evidence. The model is concerned with the impact of the D&I processes on the effectiveness of virtual organizations. The case of ELEKTRO is selected from ongoing action research in the European Telematics Engineering Project TELEflow to illustrate the model. The company has been chosen as it is actively enhancing its existing competence to design and implement virtual organizations