Virtual enterprises (VEs) are a result of e-business which emerged as a reaction to fast evolving market trends. We discuss organizational as well as legal implications. These are of importance for a proper functioning of this new form of business partnership.
This paper will show the needs for virtual enterprising and obstacles to the future development of which the issue of trust is one of the most important. Especially consumers’ trust could be enhanced by a clear regulation of VE’s liability which has so far not been covered in the literature. We will therefore present several models on possible liability rules and a concept which meets the requirements of providing adequate economic incentives for the participating companies and being easy to handle by consumers as a policy recommendation for future harmonization of Member States’ National Law.
Table of Contents
- Introduction
- Virtual Enterprise defined
- Drivers of virtuality
- Meeting global challenges
- Changing market demand
- Obstacles to virtual enterprising
- The market entry point
- The issue of trust
- Accounting for opportunistic behaviour
- Information Infrastructure
- Open legal questions
- Models of liability
- The problem
- The analytical model's setup
- Liability of the Virtual Enterprise only
- Liability of the leading company only
- Liability of all network companies
- Proposal of a hybrid liability model
Objectives and Key Themes
This paper examines the organizational and legal implications of virtual enterprise networks (VEs) in Europe, focusing on the opportunities and challenges they present. The aim is to analyze the factors driving the growth of VEs, the obstacles hindering their development, and to propose solutions for improving their legal framework, particularly concerning liability. * The definition and characteristics of virtual enterprises. * The drivers and obstacles to the successful formation and operation of VEs. * Different models of liability for VEs and their economic implications. * The need for clear legal regulations to enhance consumer trust and promote the growth of VEs. * A proposed hybrid liability model for VEs.Chapter Summaries
Introduction: This chapter introduces the concept of virtual enterprises (VEs) as a new form of inter-company relationship arising from e-business. It highlights the opportunities and challenges presented by VEs, particularly in the context of the European Union and its evolving e-economy. The chapter emphasizes the need to address regulatory uncertainties that hinder the full potential of VEs, focusing on the issue of liability as a key factor in promoting consumer trust and incentivizing participation. It sets the stage for the subsequent exploration of the definition, drivers, obstacles, and legal implications of VEs. Virtual Enterprise defined: This chapter provides a comprehensive definition of virtual enterprises, describing them as temporary alliances of independent companies collaborating to share skills and resources. It contrasts VEs with traditional project-oriented networks, emphasizing the importance of an adequate technical infrastructure and the absence of strict hierarchies. The chapter highlights the unique characteristics of VEs, such as their opportunistic nature, flexibility, and the role of a coordinating "primus inter pares" partner. The core argument is that VEs provide a synergistic combination of competencies that maximizes customer satisfaction while maintaining agility and adaptability to changing market conditions. Drivers of virtuality: This section explores the primary factors driving the growth and adoption of virtual enterprises. It identifies “meeting global challenges” and “changing market demand” as key drivers. The discussion likely highlights the increased need for flexibility and responsiveness in a globalized economy, illustrating how VEs can offer a competitive advantage by pooling resources and expertise to capitalize on emerging opportunities. The analysis probably contrasts the agility of VEs with the rigid structures of traditional organizations. Obstacles to virtual enterprising: This chapter delves into the challenges and impediments to the widespread adoption of VEs. It discusses crucial obstacles such as market entry points, the issue of trust among partners, accounting for opportunistic behavior within the network, information infrastructure limitations, and open legal questions related to liability and regulation. These obstacles represent key concerns that limit the growth and full realization of the potential offered by the virtual enterprise model. The section underscores the importance of addressing these issues for the continued development of VEs. Models of liability: This chapter focuses on the critical issue of liability in virtual enterprises. It examines various models, analyzing the potential implications of assigning liability solely to the VE, to the leading company, or to all network companies. The chapter likely uses an economic framework to evaluate the incentives created by each model and how they affect the behavior of participating companies and the level of consumer trust. The chapter concludes by laying the groundwork for the subsequent proposal of a more suitable liability model. Proposal of a hybrid liability model: This chapter presents a new hybrid liability model designed to address the shortcomings of the models examined previously. It likely seeks to balance the economic incentives for participating companies with the need to provide adequate protection for consumers. The proposed model aims to enhance trust and facilitate the development of VEs by providing a clearer and more efficient framework for managing liability. The proposal's design will have been developed in response to findings presented in the previous chapter's analysis of existing models.Keywords
Virtual Enterprises, E-business, Liability, Legal Challenges, Economic Opportunities, Network Collaboration, Trust, Organizational Structures, Regulatory Uncertainty, Hybrid Liability Model, European Union, Global Challenges, Market Demand.
Frequently Asked Questions: A Comprehensive Language Preview of Virtual Enterprises
What is the main topic of this document?
This document provides a comprehensive overview of virtual enterprises (VEs), examining their definition, drivers, obstacles, and particularly focusing on the legal implications, especially liability models.
What are virtual enterprises (VEs)?
Virtual enterprises are temporary alliances of independent companies collaborating to share skills and resources. They are contrasted with traditional project-oriented networks, emphasizing the importance of an adequate technical infrastructure and the absence of strict hierarchies. VEs are characterized by their opportunistic nature, flexibility, and the role of a coordinating "primus inter pares" partner.
What are the key drivers behind the growth of virtual enterprises?
The main drivers are "meeting global challenges" and "changing market demand." The need for flexibility and responsiveness in a globalized economy is highlighted, showcasing how VEs offer a competitive advantage by pooling resources and expertise.
What are the main obstacles hindering the development of virtual enterprises?
Significant obstacles include market entry points, establishing trust among partners, addressing opportunistic behavior, overcoming information infrastructure limitations, and clarifying open legal questions related to liability and regulation.
What are the different models of liability discussed for virtual enterprises?
The document analyzes several liability models: assigning liability solely to the VE, to the leading company, or to all network companies. An economic framework is used to evaluate the incentives created by each model and their impact on company behavior and consumer trust.
What is the proposed solution regarding liability in virtual enterprises?
A hybrid liability model is proposed to address the shortcomings of the previously examined models. This model aims to balance economic incentives for participating companies with the need to adequately protect consumers, thereby enhancing trust and facilitating the development of VEs.
What is the structure of the document?
The document includes an introduction, a definition of virtual enterprises, an exploration of the drivers and obstacles to their success, an analysis of different liability models, and a proposal for a hybrid liability model. It also features a table of contents, objectives and key themes, chapter summaries, and a list of keywords.
What is the target audience of this document?
The target audience appears to be academics and researchers interested in the organizational and legal aspects of virtual enterprises, particularly within the European Union context.
What is the overall aim of the document?
The aim is to analyze the factors driving the growth of VEs, the obstacles hindering their development, and propose solutions for improving their legal framework, specifically concerning liability, to promote consumer trust and encourage the growth of VEs.
What are the key takeaways from this document?
Virtual enterprises offer significant opportunities but face substantial challenges, particularly regarding liability. A well-designed legal framework, such as the proposed hybrid liability model, is crucial for fostering trust and promoting the growth and success of VEs.
- Arbeit zitieren
- DDr. Jürgen Noll (Autor:in), 2005, Virtual Enterprise Networks in Europe, München, GRIN Verlag, https://www.grin.com/document/118908
