ON THE THEORY OF VIRTUAL ORGANIZATION

Virtual organization is a way of structuring and managing goal-oriente d activities. This innovative approach to organization is based on a c ategorical distinction between the requirements of a task and the elem ents capable of satisfying them. The distinction supports dynamic swit ching between satisfiers for the same requirement. Switching, used pro perly and systematically, can yield dramatic improvements in task perf ormance. Although conceivable without computer communications, virtual organization would not be practicable without the technology; and the concept itself is closely related to constructs such as virtual memor y and virtual reality. This paper is intended as a contribution to the development of a theory of virtual organization. The focus is on the nature and inner workings of this innovative approach to organization; social consequences are not considered here. Using the framework pres ented in an earlier article by the author, the definition, applicabili ty, and socio-technical foundations of virtual organization are elabor ated. (C) 1997 John Wiley & Sons, Ltd.