To integrate or not to integrate: factors affecting the adoption of virtual integration strategy in organizations

Abstract

PurposeThe purpose of this article is to examine the major determinants for adopting virtual integration strategy in organizations. The article also addresses the competitive implications of adopting virtual integration strategy.Design/methodology/approachThe article proposes a theoretical model that shows the major internal as well as external factors for adopting virtual integration strategy. In addition, the article presents real‐world applications of this strategy to explain the adoption process.FindingsVirtual integration is a viable strategy in industries characterized by rapid product innovations and a high degree of competition. Virtual integration enables information technology driven supply chain coordination.Research limitations/implicationsFuture research efforts in this area should focus on testing empirically the proposed relationships between adopting a virtual integration strategy and firm performance using different industry categories.Practical implicationsExecutives in a highly competitive, innovative and increasingly varying market demand may benefit from adopting virtual integration strategy. By doing so, firms can integrate their processes using information technology to be more customer‐responsive and competitive.Originality/valueThis article identifies the value of adopting a virtual integration strategy and highlights the major factors affecting the adoption of this strategy in organizations. Managers at medium and high‐level positions in particularly dynamic industries will most likely benefit from this article.