Virtual Organizations: What You See May Not Be What You Get

Abstract

Virtual organizations are new organizational forms comprising a set ofnetwork transactions that differ from those found in markets andhierarchies. This paper explores the nature of these network transactionsthrough an in-depth study of a virtual firm. The virtual organization ischaracterized by constant organizing through virtual teams and alliances, aunique management culture and a set of norms, information andknowledge sharing enabled by information technology, and employee self-governance.The organization gains from a culture of fast-response andefficiency while employees are trusted to exercise discretion and takeinitiatives.