Let others manufacture! towards a new manufacturing framework

Abstract

Global manufacturing virtual networks (GMVNs) constitute a new type of vertical and horizontal relations between independent companies or even competitors where it is not needed to maintain internal manufacturing resources but to manage and share the network resources. The fluid relations that exist within the GMVNs allow them a very permeable organization easy to connect and disconnect from one to each other as well as to choose a set of partners with specific attributes. The result is a highly flexible system characterized by low barriers to entry and exit, geographic flexibility, low costs, rapid technological diffusion, high diversification through contract manufacturers and exceptional economies of scale and specialization. This paper analyses the causes behind the formation of such networks, their strategy, structure, dynamics and culture, taking into account areas such as strategic alliances between competitors, the permeable and diffuse nature of the network actors, the inherent paradox of collaborating with competitors, cross-cultural issues or information and communication technologies at the network level. This work will clarify and put these organizations in perspective and will analyze their evolution over the next few years. © Intangible Capital, 2009.