CA Inter P6 · Chapter 14 · Question 4 of 10
Lumina Apparel owns only its design team and brand. Manufacturing, logistics and online sales are carried out by independent partners linked through contracts and information systems. This is best described as a:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) Network (virtual) structure
Explanation
A network or virtual structure is a small core organisation that outsources most business functions to independent partners and coordinates them through contracts and technology. It is flexible and lean, and lets the firm focus on core competencies such as design and branding, though it depends heavily on partners.
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