Philosophy defines virtual as something which is not real but in today’s times the virtual world exists through the use of computer and internet. With the increase in the use of virtual world, organisations which were earlier considered as tangible using resources such as building, machines, furniture etc are now becoming intangible in nature…
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But like every coin has two sides the virtual world also has limitations too (Camarinha-Matos and Afsarmanesh, n.d., p.4-6).
This project deal is about the case of Dell who uses the virtual organisation’s model for its operations. The case outlines the opportunities that the virtual organisation’s model has provided to the Dell in improving its operations as well as the limitations the company faces because of using virtual organisation structure. The report includes a detailed study on the virtual organisation including the merits and the demerits of these types of organisational structure. The organisational structure has been analysed in detail to assess compare the different organisational structures with the virtual organisational structure. The case have been critically analysed to assess the strength and weakness of the company on using this type of organisational structure so that solutions can be identified for improving the limitations.
Dell Computer Incorporation which began its operations during 1984 as a hardware manufacturing firm under the leadership of Michael Dell is found to diversify its operations to enter the electronic commerce paradigm. The company initially depended greatly on revenues emanating from direct sales operations which were conducted based on orders received out of telephonic contacts. Dell being able to serve orders in an optimal manner became successful to gain huge amount of business profits in a quick span of time. Diversification from the current business and sales strategy was assumed by the company by drifting from direct sales to conducting sales through the help of internet. ...
Diversification from the current business and sales strategy was assumed by the company by drifting from direct sales to conducting sales through the help of internet. For the above purpose the company went in to create its own website where different types of products along with relevant information were published which helped the clients of the concern to effectively book them. Operating based on the orders placed in by the clients as during the direct selling period it helped in to maximise the utilisation of is electronic commerce interface. The electronic commerce interface not only helped the company to enhance its sales revenue on a daily basis but also helped the concern to enhance its relation with its clients and customers. Clients of Dell obtained the pleasure of getting their queries addressed online which thereby enhanced the goodwill factor of the company. Enhancement of the electronic commerce paradigm was conducted by the company by engaging its supplier network which helped the company management gain control over its production parameters and deliver ordered products on a timely basis. In this context the company also designed a separate organisational team which mainly started focusing on the electronic commerce process in order to enhance its feasibility (Kraemer and Dedrick, 2001, p.4-6). Literature review Virtual organisation The advance use of information technology helped to create a newer organisational structure which is referred to as virtual in nature. In this regard, Wiesenfeld, Raghuram and Garud (1998) state that the virtual nature of the organisation is enabled owing to the connection of different organisational activities based on an online
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