Coordination in Virtual Organization: A Strategic Solution for Sustainable Development

Abstract

Contemporary enterprises are coordinating in the form of network and virtual organization as a result of a paradigm shift in their organizational and relationship structure. Virtual structures, developed in response to certain specific market opportunities are the temporary arrangements of parties suitable for the sustainable development of enterprise. This study introduces the role of coordination in virtual organization, taking the case of SMEs which are rapidly emerging in Pakistan. The research suggests that coordination is a key determinant of effectiveness for the SMEs joining together to form a virtual organization. This is due to the fact that in virtual organization coordination establishes trust and mutual understanding among parties. Therefore, it strengthens the bond between parties developing a virtual relationship. Effective coordination could also overcome the resource limitations of SMEs; hence ensuring sustainable development and qualifying the firms to compete in the complex global environment of today. This study discusses an initial outline for advance level research in the area of coordination in virtual organization. It highlights the fact that trust, communication and social forces have an important role in establishing coordination among parties. SMEs in Pakistan as well as in the other countries can ensure better coordination in the form of virtual organization to overcome their resource constraints and to gain a sustainable competitive advantage.

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