Certified Supply Chain Professional (CSCP) Practice Exam

What defines a virtual organization?

1. A long-term partnership between competitors

2. A temporary alliance for joint research

3. A short-term alliance among independent organizations

4. A fully integrated corporate structure

The correct answer is: A short-term alliance among independent organizations

A virtual organization is characterized primarily by its formation through a short-term alliance among independent organizations. This type of structure leverages the strengths and capabilities of its partners to achieve specific objectives without necessitating a permanent and formal integration of the companies involved. Such alliances may focus on joint projects or initiatives and allow for flexibility and resource sharing that can adapt quickly to market demands or project requirements. This definition encompasses not only the temporary nature of the collaboration but also emphasizes the independence of the organizations involved, highlighting the cooperative aspect without the complexities of a formal corporate structure. The outcome is a configuration that can efficiently respond to opportunities while minimizing costs associated with maintaining full-time personnel or infrastructure that permanent collaborations would entail. The other options, while describing forms of collaboration or relationships within business, do not accurately capture the essence of a virtual organization as defined by its temporary, flexible, and independent nature.