With this information individuals needs are thoroughly catered to (virtual market experience). The free exchange of information throughout these networks resulted in a more efficient value chain and greater level of competence (virtual competence leverage).
Competitive Advantage.
Coopers and Lybrand have successfully obtained a competitive advantage over its competitors due to the following reasons. Firstly, common business understanding and practices within all of the participants of the virtual organisations resulted in the likelihood of error being greatly reduced. If, however, errors do occur in regards to a customer or corporate client, the companies" legal independence means that CL international cannot be held liable for these mistakes.
Secondly, virtual networks allow flexibility since individual national companies are able to have a quick response time to opportunities that may arise. This is the essence of virtual organisations, as they are developed to exploit opportunities in the market place. Another advantage of virtual networks is the ability to share expertise through information sharing technologies. This will be enhanced will the coordination of new technology that allows cross boarder information communication. Currently PricewaterhouseCoopers (PwC)are working on a new data transfer standard XBRL. This is designed especially for business reporting data exchange and will soon revolutionise the business-reporting environment (Wright 2001).
Lastly, due to the temporary nature of virtual networks fixed costs are lowered as CL business activities are decentralised and hence staff costs are reduced. This is also the case as the lack of contracts makes for faster response time and greater flexibility for national partners. With the event of the implementation of a successful, widely adopted system (or database) the costs of information and communication sharing will be greatly reduced.