Abstract:
Over the past few decades organization has experienced a change from modern and structural
interpretivism to the postmodern era. A postmodern perspective of organization emphasizes the
ever-changing relationship between concepts and is a defensive reaction to forces intrinsic to the
social bodies. This thesis signifies the influence of postmodernism whereby organization has
undergone strategic change towards the emergence of new paradigms. Such paradigm shifts have
the potential to keep pace with environmental changes with flexibility, efficiency and
contextually appropriate response. Virtual organization is one such paradigm. It emerged as an
outcome of strategic change due to globalization and changing consumer preferences.
This thesis initiates an inquiry into the paradigm of virtual organization of the SME
clusters in Pakistan. The thesis introduces virtual organization as a temporary combination of
geographically distributed and independently working parties, linked by ICTs for exploiting the
emerging market opportunities. It specifically highlights how a virtual relationship could be
established among the geographically proximate SMEs using low-technology means of ICTs.
This thesis puts to test a unique methodology for the study of relationship between parties, that
is, the game theoretic investigation into the virtual organization, wherein, the study further
attempts to explore the game theoretic modeling of relationship among enterprises forming an
exclusively virtual relationship.
These are several key findings and the conclusions drawn from this research. Firstly, the
geographically proximate enterprises in the SME clusters can establish a virtual relationship with
lesser advanced means of ICTs. Secondly, the relationship among parties in a virtual
organization could be modeled in the form of a non-cooperative game in which parties join
together at an optimal Nash equilibrium. Thirdly, the mutual trust and social forces work to
ensure coordination at the optimum performance level. Fourthly, this research claims an
initiative not only in terms of the methods but also the scope as it introduces the paradigm of
virtual organization in Pakistan using game theory to model the relationship among parties.
