virtual corporation

(redirected from virtual company)
Also found in: Dictionary, Thesaurus, Medical, Encyclopedia.

Virtual Corporation

The act in which independent companies work together as an association to accomplish mutually beneficial goals. Virtual cooperation is temporary and may be used for only a single project. However, for the duration of the project, the companies act as if they were a single corporation.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

virtual corporation

a firm which minimizes its internal hierarcy and maximizes its dealing with outside (i.e. market) suppliers and customers. Given today's rapidly changing technological and competitive conditions a firm needs to be more flexible in responding to changing business circumstances. To this end the firm should avoid VERTICAL INTEGRATION (and its associated AGENCY COSTS) and OUTSOURCE inputs as much as possible and deal only with independent distributors and dealers, using such new technologies as E-COMMERCE to reduce external TRANSACTION COSTS. See VERTICAL DISINTEGRATION.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
References in periodicals archive ?
When you create a virtual company, you must think out of the box about how to create a truly amazing culture with high-performing employees.
Finally, some disparities were observed between the rankings assigned to the companies with and without the virtual company. Though, there are some drawbacks that cause the inconsistency in ranking results, e.g., the assumption that all other companies are operating at different input proportions and different degree of penalization in each input factor.
"As a virtual company, it's important to involve clients early and often to reassure them that we are working efficiently to meet their expectations," says Kirschner.
Cost shifting to outsourcers also constitutes a major method for reducing a virtual company's capital requirements.
"We're changing from a traditional company to a virtual company," says Juan Izcue Elgart, a 35-year-old marketing manager at CB Capitales who initiated the idea a few years ago and is now running the service.
In Japan, it has completed a 'virtual company' internal structure to cut costs and promote competition between internal divisions.
Herein, lies the value of the virtual company and virtual systems.
These can offer clues as to the level of professionalism of a virtual company. Remember, anyone can set up an impressive Web site.
In each case, the virtual company is more powerful than the participating members alone.
"The key assets of a virtual company could simply be human resources or human capital," said Wallman.
The core competences of several small companies are aligned to form a powerful virtual company.

Full browser ?