[8] 2002 e-business-strategies-for-virtual-organizations

e-Business Strategies for Virtual Organizations
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� the problem of managing IT/IS personnel with a different
culture from the mainstream activities;
� the difficulty for managers to accurately forecast and control
costs in areas with which they are not familiar; and
� the fluctuating demand for IT/IS services internally.
In addition, the difficulty of attracting, training, and retaining IS
staff all have a part to play in this.
Having recognized these very real factors, we must still be
aware that strategies for outsourcing need to be very closely
aligned to the overall knowledge management strategy and not
based solely on cost reduction. For many enterprises, some
adoption of virtual organizational form may offer a solution to
be tested in this area. Virtual organizations offer a way to source
the best knowledge resource through virtual alliances without
the addition of further management layers for coordination and
control. In order for this to work effectively, however, the
recognition of what is happening must be clearly stated and
recognized as an integral part of the virtual strategy and it must
achieve the strategic intent. This intent must be recognized and
expressed as a goal of IT/IS improvement (most common),
business improvement or commercial exploitation. A failure to
set out clear reasons for policy is to throw away any chance of
measuring its success.
Performance and value measurement has to move away from
static measures such as market share when new markets with
very different rules and games are being developed on a regular
basis. It is well known that Amazon.com cannot be measured
against traditional market values since it has yet to record
traditional profits and is not pursuing a policy of doing so in the
short term. New approaches such as economic value added
(EVA), market value added (MVA), and benchmarking give
much wider definitions of value and need to be incorporated into
the organization’s portfolio management. An analysis of industrial
and business wealth creation today might well be based on
the role of intangible assets and dynamic capabilities.
There is also one further issue to be added to the above list – in
our opinion. We maintain it is of critical importance to any
knowledge management strategy, and that is how to look after and
manage the people on whom the organization depends. We encourage
you to think in terms of what the social structures, attitudes and
reward mechanisms are – or that should be in place – to move
toward effective knowledge management and create a real
knowledge-based culture in the organization.