Virtual enterprise (VE) is considered as the organization form of agile manufacturing, but what are virtual enterprises virtualize? There is little literature related to this issue. Based on “problem driven” instead of “concept driven”, representative literatures, definitions and cases of VE will be analyzed in this paper. Then based on these different problems and three kind of organizational theories proposed by Santos and Eisenhardt, this paper will classify virtualizing as function virtualizing, form virtualizing and resource virtualizing to characterize different problems that different definitions of VE proposed to solve.

Virtual enterprise (VE), like strategic alliance, outsourcing and supply chain, focus on inter-organizational cooperation. But, how can we identify and differentiate it from them? Goldman and Preiss gave the six strategic reasons for the formation of VE. However, the six strategic reasons are not exclusive for VE, and which is lack of reasoning based on strategic management theory. Our purposes are: 1, reasoning the formation of VE based on resource based theory; 2, identifying VE and differentiating it from strategic alliance, outsourcing.