Virtual organization structure suitable for software companies

    Virtual organization structure is designed to be fluid by nature for being agile and scalable. Rigid structures will not generally suit demographically dispersed team to attain their organizational goal.

Following questions are asserted by hardcore quality analyst

a)      Can virtual organizations manage quality?

b)      Are there any calculated scientific risks available for Virtual Organizations?

c)       Are there reliable, sufficient and supportive statistical evidence ?

d)      Is it approved and accepted as a scientific management technique?

The list of questions may never end…but the answer is ... 

"Virtual organization will serve the purpose, if deliverable is important"

 It reminds me about the ten year old debate which is ongoing in developed countries; about contract staffing teachers. Shortage of teachers pressed the school authorities to fill vacant positions with contract teaching staffs. There were questions regarding the contract staff responsibilities and quality of education they would impart. Profound debates are still heard about education systems, but the purpose of filling teaching positions was achieved swiftly. In nutshell we would have to balance and prioritize deliverable.

Another debate broke out when the developed countries opened their space explorations to private companies. Track record and statistics prove that these companies are achieving their goals faster than government space agencies. We stand better chance to tour the moon in our life time though the quality, standards and process are not strictly adhered to. Not only these companies are growing five times as faster but also have proved that space explorations are profitable ventures.

Virtual organization structure are not totally different from above examples. Virtual organization simply serves its purpose but an efficient project manager would have to mix and match certain technical and management aspects to attain a right deliverable ratio of quality verses productivity. Management is both art and science, hence a right chord has to be struck for making it work.  Working with virtual organizations and globally distributed staff can be even more challenging at times, but productivity needs to be tuned for attaining its purpose.

Physical assets of a Virtual organization: 

There is hardly any physical asset required in a virtual organization. Film industry is the best example for such a case study. Hollywood - this rich industry has remained successful virtual organization venture and will remain so in future.


Completely dependent on manager to scale up and even down depending on the work load. Most virtual organization team members would have never even met in real life. There are numerous customers and organizations that are functioning in this pattern since years.

Quality control: 

Layout strict acceptance criteria and proper guidelines in the process to follow. The difference here is that the manager should be more random audit centric when approaching quality goals and frequently do auditing than physical organizations.

Reference books:

Handy, C., “Trust and the Virtual Organisation”, Harvard Business Review, May–June 1995