Information and communication technology has dramatically changed the world scenario. The new millennium signals the dawn of an exciting electronic information and communication era, brought about by the rapid advances in communication and information technology. The revolution of information and communication technology has created the global village and affected the way we live and work. These technological advances are opening new and exciting avenues that challenge the traditional ways of interacting, communicating and doing business. As the world scenario changes with the development of new technologies, time and speed become important in our daily life. A series of technological breakthroughs made possible for rapid processing and instant delivery of information and services throughout the world. This has led to the restructuring of the global economic environment and placed new demands on corporate management, which in turn gave rise to high-speed management system.

The business of the information age in the new millenium will be different from the business model in the industrial age. A new business model that continuously adapts, adjusts and innovates is essential. Entering to the new century, perhaps that only way to face the market challenges is to continue to reinvents and ensure the best for the customers. Quality, flexibility and responsiveness are the strategic issues of today’s corporate organizations. Organizations which do not recognize this new discipline will decline and eventually will disappear. To survive in this environment, organizations must learn to be flexible and responsive to the customers’ needs.

As the market demands short response time and flexible adaptation to the customers need, that has led to the emergence of a new concept of flexible network type of organization. The virtual organization is an example of a flexible network organization that meets the aforementioned requirement. Byrane (1993, p.8) states that the Virtual Organization is a temporary or permanent network of independent companies linked by information and communication technology to share skills, costs and access to one another’s market. The Virtual Organization is a new phenomenon in organizational design. The euphoric reports of the Virtual Organization being the corporate model of the future, which is capable to solve current problems of market globalization and saturation with great flexibility and quick service. However, the concept of Virtual Organization is not clear to many people and business organizations. They are still ignorant of conducting business and sharing resources over the networked corporation. This paper aims at demonstrating the rising concept of Virtual Organization, its origin and economic and technological determinants of the development. It will try to investigate the elements and features of Virtual Organization and examine its actual operations and probable future significance in the global marketplace.

Although the concept of Virtual Organization has been slowly developing and coalescing for at least a decade, only recently it has come to public attention. In the last decade of the 20^th century the business organization is trying to develop a new form of intelligent corporation called Virtual Organization. There are two major forces which led to the emergence of Virtual Organization. They are (1) Rapid advancement of information and communication technologies and (2) Development of the concept of High-Speed Management.

The world is approaching a new millenium. The most cardinal and exciting issue of this century is the advancement of information and communication technology. The usage and application of technology in this era will be more extensive and widespread. It has already been acknowledged that the revolution of information and communication technology has changed the human society and organizational life. A dramatic revolution had occurred in the communication and technology sectors. The development of digitalization and fiber optics have taken us into the information society. Information and communication technology has reshaped the basics of business. Customers service, operations, products and marketing strategies and distribution are heavily dependent on information and communication technology. Businesses face new challenge of keeping up with the rapid pace of technological change. Many business organizations have already conceded to the electronic era. Organizations now can communicate with partners through out the world within short time. Business transactions have become both global and virtual. Now it is possible to carry out business activity without having particular shop and location.

Economics of many industrialized countries around the world are going through a period of intensive restructuring resulting in new corporate operational models based on advanced information technologies to enhance their productivity and competitiveness. Restructuring of the enterprise is a collective term which implies reengineering of corporate processes designed to make it more competitive in a rapidly changing global marketplace. New technologies and shortening product life cycles require the development of more efficient operations to survive and make profit. Restructuring has been under way for some years in many industries and is expected to continue for some time to come (Szuprowicz,1995). Over the past decade, widespread adoption of information and communication technologies has radically changed organizational structure and altered the way companies operate. Information and communication technology is affecting the entire process by which organizations create their products and provide services. Many companies are using information and communication technologies to achieve a sustainable competitive advantage. A competitive advantage means that the company has found a better way to serve its customers and acquire new customers through the way it uses its information technology. In order to gain a competitive edge in global market, the organization has to change it structure, principles and strategies. The competitive challenges faced by today’s corporate organizations are completely different from the competitive business environment of the past. The global business environment coupled with information and communication technologies has created opportunities as well as challenges. In order to cope with the new challenges, successful business organization must be different from the past.

Advancement of information and communication technology has made the world borderless. Ohmae (1992) mentions that on a political map, the boundaries between countries are as clear as ever. But on a competitive map those boundaries have largely disappeared. Of all the forces eating them away, perhaps the most persistent is the flow of information. Ohmae (1992) believes that when information flows with freedom, the old geographic barrier becomes irrelevant. These remarks are now more true when organizations are rapidly adopting information and communication technologies to create their market globally. The information and communication technologies have radically compressed time and space in this century. Modern technologies such as fiber optics cable and satellite transmission has increased speed in exchanging data and financial information around the globe. This has given advantages for the companies to communicate and share resources among geographically dispersed partners and with the customers. Today a large proportion of business organizations are dependent upon information and communication technology to maintain the efficiency and effectiveness of their business operation. In fact, many companies could no longer function without using of information and communication technologies.

On the other hand, High-Speed Management System has become the New World Order in a fast-growing global marketplace. High-speed management is a set of communication and management principles designed to protect organizations against environmental conditions. The development of technology, new marketing and management strategy combined with an emergent global economy creates a volatile business environment. To survive in this era of competition, corporations need to be innovative, adaptive and efficient. Corporations needs to be fast in new product design, development and service to cope with quick market saturation and competition. Speed in getting products to market has become a concern for organizations due to rapid changing technology, quick market saturation and unexpected global competition. Competitive advantages in global marketplace are unattainable without high-speed management. The purpose of high-speed management is to achieve and maintain sustainable competitive advantage by innovative, flexible and rapid response to environmental change. Cushman and King (1994) report

a series of technological revolution made possible for organization to process and instant delivery of information and services throughout the world. New manufacturing technologies allow for rapid development of products, sales and services at low cost, high quality and easy service throughout the world. New marketing information technologies enable to speed up in providing customers world-class products when and where they want them in order to increase market share. New management information technology helps to integrate, coordinate and control management processes in order to create competitive advantage.

Rapid technological changes create challenges for the organization but it also create opportunities. In this situation, organizations must have certain characteristics in order to respond to the opportunities caused by environmental change. A rapid changing technology, quick market saturation and unexpected competition have led to the emergence of a new corporate perspective for coping with volatile business climate. Therefore, companies must stay close to both their customers and their competitors. Successful companies always know what the customer needs and attempt to provide it. They think constantly about new products and product quality, user friendliness, ease of service and competitive pricing for market penetration. A corporate vision has be developed which emphasizes on change and allow for the assimilation of new units. A corporate strategy has adopted which allow for potential acquisitions, joint ventures, coalitions, value-added partnerships and tailored trade agreements which can give a corporation a technological edge, marketing access, marketing control and rapid response capabilities (Fraker quoted in Cushman and King, 1994). Thus, the purpose of high-speed management is to use of the new information technology to rapidly develop and manufacture low-cost, high quality, easily serviced, high-value products which meet the customers needs. These are some of the technological and economic determinants that led to the emergence of new kind of flexible, efficient and networked corporation called Virtual Organization.

The concept of virtual office, virtual classroom and virtual corporation appeared in the literature some years ago when working at home made possible by the help of advanced information and communication technologies. The research on Virtual Organization has resulted in numerous definitions. The definition of Virtual Organization varies from one author to another. Sieber (1997,p1) says "Virtual Organization is used to refer to an actual organization which, like a traditional organization, aims to supply goods and services by means of its staff, equipment and information system to pursue maximum profitability". The major characteristics of this new form of organization are intensification of teamwork and integration of the value chain and organizational knowledge to provide quality products and services. Virtual Organization is a temporary or permanent network of independent companies that come together quickly to exploit specific opportunities. In a Virtual Corporation, companies share costs, skills and access to one another’s market. It is an organizational network which structured and managed in such a way that it operates between customers and other external stakeholders. In 1995, first virtual Bank was established in the USA called Security First Network Bank (SFNB). It is federally approved bank in the USA. All activities and transactions of the bank with its customers are on line and in real time system. There are several other Virtual Organizations which exists in the internet such as Amazon.com, Mark Russell and Associates. They are successfully conducting intensive business activities through the network system all around the world.

Virtual Organization is a combination of several small and medium organizations over a wide geographical area which are committed to achieve a collective goal by pulling their core competencies and resources. The partners of Virtual Organizations enjoy equal status and are dependent upon electronic connections for the coordination of their activities. Virtual Organization is configuration of semi permanent, interdependent, geographically dispersed organizational units enlarging their overall performance in responsiveness on changing market needs and communication and information technology capabilities by continuously adapting their organizational forms (Wassennar,1999). Virtual Organizations respond to market opportunities. As market based incentives become greater, the risk taking is also increase. However, Virtual Organization works based on trust. The fate of each partner in Virtual Organization is dependent on the other partners. The semi stable relations of the partners and the shared risk make the members more dependent and because of the sharing of information and knowledge, there is a high amount of trust among the partners.

Virtual Organization has enormous advantage of flexibility. There is no hierarchy in virtual organization because of equal status of the partners. Partners flexibility and fast movement is essential for going after opportunities. Companies will unite to exploit a specific market opportunity and more likely to fall apart once the need evaporates. The relationship between the partners in a Virtual Organization is less formal and less permanent. These relationships create dependencies among the partners. Byrne (1993) argues that Virtual Organizations have vague or fluid boundaries. It redefines the traditional boundaries of organizations. Unlike traditional organization, in Virtual Organization there is more cooperation among customers, suppliers and designers. There are also several Virtual Organizations which are permanent, and existing for a long time such as Virtual bank in the Internet.

The ideal concept of a Virtual Organization is the synergetic completion of the partner's core competencies. Core competency is the unique professional and technical capability that an organization possesses. Each partner of the Virtual Organization brings in solely his core competencies, capabilities and resources. Each company is connected with one special value chain and as partners bring their core competencies, it is possible to develop high quality products and services which is unattainable for a single company. According to Erben and Gerste (1998) Virtual Organization could be seen as a cluster of core competencies in terms of economical and informational relationship within a legal entity. Virtual Organization is intentionally designed to serve value chain with high degree on customized products, brain work, rapid changing profile on service provision and meet requirements of high quality, low cost and shorter product development and manufacturing cycles. In the state of Saxony, Germany, a network has been established among small and medium enterprises to share market information, enhance industrial collaboration and provide cooperation for complex product development and manufacturing.

Information and communication technologies are key factors in Virtual Organization. Information network helps geographically spreaded companies to link up and work together. Information and communication technology is the glue that makes the partners of the Virtual Organization together. Information and communication technology makes virtual partners a system of virtual unity. Virtual Organizations are heavily dependent on information and communication technologies such as Internet, electronic mail, videoconferencing, electronic data interchange etc. Creating Virtual Organizations between the most appropriate partners for a special transaction situation could bring together firms and persons from all over the world. Information and communication technology in Virtual Organization reduces the geographical and social distance between sender and recipient in perfect way. They enable potential members to be integrated easily into the organization and have an electronic contact among members.

Information and communication technology in Virtual Organization is used in two ways. The World Wide Web is used for external representation of the organization in the Internet. Each enterprise's homepage is connected by hyperlinks with other companies homepage. On the other hand, electronic mail, database is used for internal communication and coordination. All information about a project are available for all partners at any time and are updated continuously. All activities are managed electronically and information is available on line and real time information system. Multimedia communication technology is used interactively to support the collaboration among organizations. Desktop, video and teleconferencing system enable audio and video communication between separate members. These integrated communication channels are an optimal solution for real time information system. The exchange of business data between computers of different corporations by using standard format is called electronic data interchange. The purpose of electronic data interchange is the direct electronic communication to enable a direct processing of relevant, high structured mass data without any intervention. By using a common of electronic data interchange system, the members of a Virtual Organization can exchange data form any location at any time.

The Virtual Organization is certainly one of the prominent structures of the future corporation. It is an example of an emergent organizational form which is going to evolve in the 21^st century. The new century will bring lots of challenges and prospects. In order to respond those challenges organizations must have a comprehensive process for the continuous application of information and communication technologies to their operating system to provide products with high quality, low cost and quick service to the customers. To succeed in the era of global competition, there will be a rapid growth of the Virtual Organization in the near future. Organization will be forced by the turbulent business environment to run business virtually. Now organizations are able to market their products and services all around the world without having particular shop, capital and direct contact with customers with the help of information and communication technologies such as internet. Perhaps within twenty years of time it will become an acceptable and usual part of the business world. It will increase facilities for the customers and will give direct channels to the millions of potential customers to access information, services and products that can be ordered online. We can only imagine what changes it will bring to our society when all business activities will be done electronically and people will get everything what they need without going to the market.

However, several concerns have been raised in connection with the emergence of Virtual Organization as it uses sophisticated information and communication technologies and all activities are performed electronically. Virtual Organization may not, therefore, be an appropriate business form for all set of circumstances. As Virtual Organization works with advanced technologies, small and medium corporations might not be able to bear cost and maintenance of such technologies. Virtual Organization can only be formed and operated in the society where technology is highly advanced. Third world countries are far behind to adopt such concept because they are economically poor, technologically backward and professionally inferior. They are still using unsophisticated network system and traditional way of doing business activities.

Privacy and security are the other major worries in Virtual Organization. There was a time when people could be confident that no one can invade the privacy but with the technological revolution it makes easier to invade privacy and confidentiality. Walking down to the market and paying in cash may not be as convenient as punching a few keys on keyboard at home. Every time when a person uses an automated teller machine, the bank records the time, date and location of transaction. When a person writes an e-mail or surf a web side computer may disclose personal information and person may be watched by the computer. Computer can record what person is looking at and when has been surfing. As people conduct more and more personal business over the net, that will allow bank, broker and companies to get information on individual behavior and what they buy with credit card. If any transaction is done electronically, others may access that information easily. Another problem is that in a Virtual Organization partners of the corporation can access and share data information one another in a real time. So, one partner can misuse or reveal other partners’ financial data and strategic information or one company can use other companies’ secret information for its own benefits.

The trend toward a networked organization continues to grow. The networked organization is Virtual Organization. In the turbulent business environment of the new millennium, Virtual Organization will be the model organization. Based on the study of Virtual Organization, a few suggestions are put forth. The study on the introduction of Virtual Organization should be extended to other type of organization, especially the public/governmental and semi-governmental organizations. A comparative study should be carried out to see the perception of the government management personal on such networked organization. A survey should be carries our to find out the attitudes and perception of customers toward the Virtual Organization as it is a new concept in the business environment. An appraisal study of the performance and effectiveness of the Virtual Organization should be done to test the congruency of the management perception of the system favorableness. As privacy and security are the biggest concern among the users of the Virtual Organization, therefore, data and private information protection is critically important. Government and other related bodies should work together to develop international regulation and policies to promote security and privacy in the new networked business corporation.

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