1 Izr. prof. dr. T. G., Sveučilište u Zagrebu, Šumarski fakultet, Svetošimunska 25, p. p. 422, 10002 Zagreb, Hrvaška, grladin@hrast.sumfak.hr
2 Doc. dr. L. O., Biotehniška fakulteta, Oddelek za lesarstvo, Rožna dolina, C. VIII/34, 1000 Ljubljana, Slovenija, leon.oblak@bf.uni-lj.si
3 Doc. dr. J. K., Biotehniška fakulteta, Oddelek za lesarstvo, Rožna dolina, C. VIII/34, 1000 Ljubljana, Slovenija, joze.kropivsek@bf.uni-lj.si
4 Doc. dr. T. P., Sveučilište u Zagrebu, Šumarski fakultet, Svetošimunska 25, p. p. 422, 10002 Zagreb, Hrvaška, tomislav.porsinsky@zg.hinet.hr
5 Izr. prof. dr. D. J., Sveučilište u Zagrebu, Šumarski fakultet, Svetošimunska 25, p. p. 422, 10002 Zagreb, Hrvaška, jelacic@sumfak.hr
6 Doc. dr. D. M., Sveučilište u Zagrebu, Šumarski fakultet, Svetošimunska 25, p. p. 422, 10002 Zagreb, Hrvaška, motik@sumfak.hr
Zbornik gozdarstva in lesarstva 84 (2007), s. 11–16
GDK: 792(045)=111
Prispelo / Received: 05.04.2007               Izvirni znanstveni članek
Sprejeto / Accepted: 12.06.2007                             Original scientific paper
The research of virtual production in wood industry 
Tomislav GRLADINOVIĆ1, Leon OBLAK2, Jože KROPIVŠEK3, Tomislav PORŠINSKY4, Denis JELAČIĆ5,  
Darko MOTIK6
Abstract
Enterprises with inflexible production structures can no longer survive in a turbulent market, as they cannot react to changes that would
lead to their development. In order to satisfy specific customer needs related to quality, quantity, cost and delivery terms, it is necessary
to restructure the existing enterprises according to the Taylor principle. One of reconstruction possibilities is the implementation of 
new co-operation forms that lead to virtual enterprises i.e. changeable networks. A changeable network can only achieve efficiency
by means of a modern information and communication technology. This paper presents an idea of a changeable network that can be 
acceptable for all participants within a virtual enterprise. 
Key words: wood industry, co-operation, virtual enterprise, changeable network, information
Raziskava virtualne proizvodnje v lesni industriji
Izvleček
Podjetja z nefleksibilno proizvodno strukturo ne morejo več preživeti na turbulentnem trgu, saj ne morejo odreagirati na spremembe,
ki bi lahko vodile v njihov razvoj. Zato, da bi zadovoljila specifične potrebe potrošnikov, povezane s kakovostjo, količino, stroški
in dobavnimi roki, je nujna reorganizacija obstoječih podjetij po Taylorjevem principu. Ena izmed reorganizacijskih možnosti je 
implementacija nove kooperacijske oblike, ki vodi do virtualnih podjetij oz. spremenljivih mrež. Učinkovitost lahko zagotovijo samo 
spremenljive mreže, in to s pomočjo moderne informacijske in komunikacijske tehnologije. Članek predstavlja idejo spremenljivih 
mrež, ki je lahko sprejemljiva za vse udeležence v virtualnih podjetjih. 
Ključne besede: lesna industrija, kooperacija, virtualna podjetja, spremenljive mreže, informacija
1 Introduction
1 Uvod
The managers of Slovenian and Croatian wood 
enterprises are trying to follow the contemporary 
organisation trends, although they are mainly driven 
on by the urgency of immediate action. This results in 
misunderstanding of the essential reasons for the required 
changes. 
The resulting problems and failures of the proper 
strategy choice and suitable partners may often disorient 
the managers in their decisions on introducing the new 
business and organisation concepts. The enterprises that 
successfully reorganise and redesign their wood processing 
and furniture enterprises by creating quality networks 
of partnership relations will significantly improve their
business possibilities (TIPURIĆ / KOLAKOVIĆ 2002).
The results of the research (WIENDAHL 1991, 
WILDEMANN 1996, BELAK / VEŽA 1997, KOENIG 
1998, WILDEMANN 1998, HEDBERG 1999, 
GRLADINOVIĆ 2000, COLLINS 2002, KISIELNICKI 
2002, GRLADINOVIĆ / FIGURIĆ / VEŽA 2002) carried 
out so far point at the necessary preconditions for creating 
virtual enterprises in Slovenian and Croatian wood industry 
enterprises. If they wish to follow the modern business and 
organisation concepts, Slovenian and Croatian enterprises 
should apply universal models for the transition to the 
virtual way of business. 
The enterprises that will use the knowledge and 
research results in their transition to the virtual business 
at reorganising and transforming their activities will 
withstand the organisation changes faster and less painfully 
and will find it easier to adjust to the turbulent conditions in
economy (TIPURIĆ / MARKULIN 2002).
12            Zbornik gozdarstva in lesarstva 84
2 Materials and methods
2 Materiali in metode
Strategic alliances are agreements between firms in
which each commits resources to achieve a common set 
of objectives. A strategic alliance is a formal relationship 
formed between two or more parties to pursue a set of 
agreed upon goals or to meet a critical business need while 
remaining independent organizations.
Partners may provide the strategic alliance with 
resources such as products, distribution channels, 
manufacturing capability, project funding, capital 
equipment, knowledge, expertise, or intellectual property. 
The alliance is a cooperation or collaboration, which 
aims for a synergy where each partner hopes that the 
benefits from the alliance will be greater than those from
individual efforts. The alliance often involves technology 
transfer (access to knowledge and expertise), economic 
specialization, shared expenses and shared risk.
A virtual organization is an organization existing 
as a corporate, not-for-profit, educational, or otherwise
productive entity that does not have a central geographical 
location and exists solely through telecommunication 
tools. A virtual organization comprises a set of (legally) 
independent organizations that share resources and a skill 
to achieve its goal, but that is not limited to an alliance 
for profit enterprises. The interaction among members of
the virtual organization is mainly done through computer 
networks.
A virtual enterprise is a temporary alliance of 
enterprises that come together to share skills or core 
competencies and resources in order to better respond to 
business opportunities, and whose cooperation is supported 
by computer networks. It is a manifestation of collaborative 
networks and a particular case of virtual organization.
Experimental research on strategic alliances or virtual 
organisations was carried out in two parts. In the first part of
the research, enterprises from different industrial branches 
were interviewed on using strategic alliance and virtual 
organisation. Thirty percent of the eighty-one enterprises 
that returned the filled in forms expressed a higher
profitability than the Slovenian and Croatian percentage.
Forty percent of them showed average profitability, while
30% of the enterprises reported lower than the average 
values.
In the second part of the research, small and medium-
sized wood enterprises were chosen from a sample. They 
were interviewed on the use of the virtual organisation 
concept. We received seventy-one answers. The sample 
and the answers are relatively indicating for the situation 
on the Slovenian and Croatian market. 
The results were processed and statistically analysed 
by Microsoft Office Excel 2003 for Windows computer
programme.
3 Results and discussion
3 Rezultati in razprava
The expectations about the participation of enterprises 
in the strategic alliances are optimistic. Figure 1 shows the 
expectations of Slovenian and Croatian managers about the 
future business strategic alliances in Slovenia and Croatia.
Figure 1: Expectations of Slovenian and Croatian 
managers about the future business strategic alliances in 
Slovenia and Croatia
Slika 1: Pričakovanja slovenskih in hrvaških managerjev 
o prihodnjem poslovnem strateškem povezovanju v 
Sloveniji in na Hrvaškem
Almost two thirds (66.2%) of managers expect that 
enterprises will be increasingly joining strategic alliances 
with partners. Another percentage of them (24.6%) think 
that this increase will be very high. On the other hand, 7.1% 
of the managers think that the co-operation in the form of 
strategic alliances will remain at the same or similar level, 
while only 2.1% believe that the future will bring a decrease 
in such business activities. Considering the size of these 
enterprises, small enterprises are extremely pleased about 
joining strategic alliances (Figure 2).
Figure 2: Expectations of the managements of small, 
medium and large enterprises on promoting the entry 
into strategic alliances
Slika 2: Pričakovanja managementa majhnih, srednje 
velikih in velikih podjetij o pospešenem vstopanju v 
strateške povezave
 
high increase
(visoka rast)
24.6 %
stagnation
(stagnacija)
7.1 %
decrease
(padec)
2.1 %
increase
(rast)
66.2 %
93.8
73.7 77.1
6.2
26.3 22.9
0
10
20
30
40
50
60
70
80
90
100
Small enterprises
(Majhna podjetja)
Medium enetrprises
(Srednje velika podjetja)
Large enterprises 
  (Velika podjetja)
Enterprises, that expect increase in number of strategic alliances 
(Podjetja, ki pričakujejo porast števila strateških povezav)
Enterprises, that do not expect increase in number of strategic alliances 
(Podjetja, ki ne pričakujejo porast števila strateških povezav)
Grladinović, T. et al.: The research of virtual production in wood industry 13
A major advantage of strategic alliances is the 
possibility of contributing to the general competitiveness 
of enterprises by different business functions. Within the 
research, the managers were interviewed on the part of 
business functions that are most suitable for such kind of 
co-operation.
More than half of the managers (50.8%) consider the 
entry into new markets as a good support for organising 
strategic alliances. A slightly lower percentage of managers 
(48.0%) think that the function of research and development 
could be a good environment for strategic alliances. 
Further on, 42.3% of managers believe that production is 
crucial, while almost the same number of them (38.9%) 
regard logistics as essential. For 33.1% of the interviewed 
managers, technology plays the most important role and 
30.9% think that marketing is the most important function, 
while 27.2% of them think that supply activities are 
essential. Only 14.8% of the examined believe that there 
is a possibility of strategic alliances through financial
functions of the enterprises.
Considering the analysis based on the size of the 
enterprise, the managers of smaller enterprises think that 
production is the best support for strategic alliances. Medium 
and large enterprises look for strategic partners mainly in 
the areas of research and development (Figure 4).
The results of the experimental research on the 
establishment of virtual organisation in small and medium 
wood enterprises have shown the following significant
results:
– 89% of small and medium enterprises believe that 
the virtual organisation alliance will have better 
business results;
50.8
48.0
42.3
38.9
33.1
30.9
27.2
14.8
0
10
20
30
40
50
60
Penetrating new markets
  (Prodor na nove trge)
Research & development
  (Raziskave & razvoj)
Production (Proizvodnja)
Logistics (Logistika)
Technology (Tehnologija)
Marketing (Marketing)
Supply (Ponudba)
Finace (Finance)
Pe
rc
en
ta
ge
 / O
ds
to
te
k (
%
)
Figure 3: Appropriate business 
function for participating in a 
strategic alliance
Slika 3: Primerne poslovne 
funkcije za sodelovanje v 
strateških povezavah
62.5
37.5
68.8
62.5
40.0
44.0
24.0
20.0
50.0 52.6
34.2 34.2
0
10
20
30
40
50
60
70
80
Penetrating new markets
   (Prodor na nove trge)
Research & development 
  (Raziskave & razvoj)
  Production 
(Proizvodnja)
 Logistics 
(Logistika)
Pe
rc
en
ta
ge
 / O
ds
to
te
k (
%
)
Small enterprises (Majhna podjetja)
Medium enterprises (Srednje velika podjetja)
Large enterprises (Velika podjetja)
Figure 4: The most suitable business function for participating in a strategic alliance according to the managers of 
small, medium and large enterprises
Slika 4: Najbolj primerne poslovne funkcije za sodelovanje v strateških povezavah po mnenju managerjev majhnih, 
srednje velikih in velikih podjetij
14            Zbornik gozdarstva in lesarstva 84
– 81% of small and medium enterprises think that 
virtual organisation is a better variant than the 
development of formal limitations of classical 
enterprises;
– 50% of them already use some kind of business 
contacts and relations with virtual organisations. 
An interesting feature is the proportion of total 
income of small and medium enterprises achieved at 
different network levels. The following are the results of 
interviewing small and medium enterprises that use some 
kinds of business alliances:
– Most managers of small and medium enterprises 
(38%) have no data on the income percentage 
realised by business alliance;
– The income proportion of a business alliance within 
the total income of such enterprises shows that:
• 16% of small and medium enterprises realise up 
to 10% of their income through such alliances;
• 23% of small and medium enterprises realise  
10%–25% of their income through such 
alliances;
• 10% of small and medium enterprises realise  
26%–50% of their income through such 
alliances;
• As many as 13% of small and medium 
enterprises realise 50% or more of their income 
through such alliances, which is a good result.
Figure 5 shows the income percentages of small and 
medium wood enterprises realised by business associa-
tions.
Figure 5: Income percentages in small and medium 
wood enterprises realised through production network
Slika 5: Odstotek prihodka, ki so ga majhna in 
srednje velika lesna podjetja realizirala skozi mrežno 
proizvodnjo 
Amongst the enterprises that use some kind of 
business alliances, 72% are satisfied with this type of
cooperation. According to the obtained results we may 
establish that Slovenian and Croatian enterprises are trying 
to follow modern organisation trends. However, the reason 
for this seems to be the inclusion of market competition, 
or their imitation, and the need of intervention. This shows 
the misunderstanding of such business models. As a result, 
the errors in choosing the right strategy are also reflected as
the errors in choosing the right business partner. The errors 
in strategic changes can then discourage the managers 
in making decisions on organisation innovations. Those 
enterprises that have been successfully united forming 
quality partnership networks realise better business results 
(TIPURIĆ / KOLAKOVIĆ 2002).
We shall observe the architecture of the production 
network and the functioning of the leading enterprise 
(1999–2005). This enterprise should develop a production 
network that would welcome independent, adjustable and 
innovative units. The aim of creating strategic alliances 
is to increase the adjustability and capability of reacting 
to buyers’ demands, to stimulate independency and 
synchronisation of small and medium wood processing 
enterprises and furniture manufacturers. The project 
of production network consists of an organisation and 
production structure with business and production 
processes based on modern organisation concepts. The 
leading enterprise has thus been encouraged to develop 
virtual network production, while a precondition for the 
competitiveness of the production within the work division 
has been realised. The leading enterprise in such a strategic 
structure consists of six departments: manufactured board 
production, sawmill with seasoning facilities, service 
and administration. This is accompanied by eleven small 
and medium-sized wood processing enterprises and 
furniture manufacturers. The organisation structure of 
the leading enterprise contains a virtual enterprise whose 
structure consists of the cooperating association, forming 
the production network and the distribution and sales 
centre of wood products. The leading enterprise and the 
cooperating partners are not separated by competition, but 
communicate and try to fulfil the market functionalities.
The leading enterprise assigns one part of its market orders 
to the medium, small and trade enterprises. The cooperating 
partners are in this way united into the leading enterprise. 
In case of a reduced demand, they can easily focus on the 
local market changing their supply. The virtual enterprise 
has unlimited possibilities. Its basic aim is to increase the 
competitive capability on the market and to seize its larger 
segment.
Supported by the production network of its 
cooperating partners, the leading enterprise can thus achieve 
better adjustability to the market and the production. The 
cooperating partners carry out a number of services for 
the leading enterprise (e.g. cross-cutting, resaving and 
planning, shaping, turning, sand milling, drilling, joining, 
gluing, surface finishing, assembling, packing, storing
before delivery, etc.).
The distribution sales centre whose virtual enterprise 
has the task to collect products from the cooperating partners 
do not know 
   (ne vejo)
       38%
<10% of income 
      (prihodka)
            16%
10-25% of income 
      (prihodka)
            23%
26-50% of income 
      (prihodka)
            10%
>50% of income 
     (prihodka)
          13%
Grladinović, T. et al.: The research of virtual production in wood industry 15
and assemble them. Its further field of work is wholesale
and retail, the issue of work orders according to the buyer’s 
desires and demands, the preparation of the technology, 
the building of the production network according to the 
work order, the establishment of the capacities, and the 
distribution of jobs within the network.
Modern information-communication technology is 
applied to the data processing and the preparation of work 
orders. The following are the aims of a virtual enterprise:
– higher adjustability and orientation towards the 
market,
– to size a larger market segment,
– to increase the capacity use,
– bigger production volume,
– better use of the products,
– higher competitiveness of the products’ prices,
– to increase the profitability,
– to establish a quality-oriented management,
– to focus on the technological process,
– a production network as a priority element of 
forming the organisation,
– reinforcement of the firm’s own responsibility,
– team work,
– application of information/communication 
technology,
– cooperation beyond the firm’s area (buyer –  
supplier),
– gradual introduction of development measures.
The preconditions for proper inclusion of the virtual 
enterprise into the world work division and the global 
market contest have thus been established.
4 Conclusion
4 Zaključek
The described system of production networks 
enables lower product prices, seizure of a larger market 
segment, and higher competitiveness and profitability,
enabling better control of costs, production time, quality 
and quantity of wood products. It also helps to reduce 
capital binding. Lower are also the investments into the 
enterprise infrastructure. The waste disposal issue is also 
reduced, since one part of the enterprise waste returns 
to the manufactured board production. Innovations and 
advancements of the production, work organisation, 
products, etc., are achieved by network change. The 
functions of management, coordination and controlling are 
established within the virtual enterprise, offering modern 
logistic support to the production network. Altogether, a 
better control of the total production costs and high quality 
of wood products and services are achieved. The leading 
enterprise has all sorts of possibilities of capital investments 
and new product projects, marketing, supply, trade, 
transport, etc. The participation contributes to the widening 
of the network and operation relations (rising employment, 
wider product assortment, innovating processes, etc.)
Expectations of the Slovenian and Croatian managers 
about the future business strategic alliances in Slovenia and 
Croatia are very interesting. 66.2% of managers expect that 
enterprises will be increasingly joining strategic alliances 
with partners. About half of the managers consider the 
entrance into new markets as a good support for organising 
strategic alliances. They also think that the function of 
research and development could be a good environment for 
strategic alliances. A lot of small and medium enterprises 
think that the virtual organisation alliance will have better 
business results. Amongst the enterprises that use some 
kind of business alliances, 72% are satisfied with this type
of cooperation. 
Virtual enterprise has also certain disadvantages. It 
should have a large sales/supply market of wood products 
and should educate the employed cooperating staff in 
the fields of marketing, logistics, engineering, the “new
economy”, e-business, etc. Between the leading enterprise 
and its cooperating partners there is infrequently a sense 
of distrust. Cooperating partners have old cost-rising 
production technology. The flow of the material entails
additional, undesired transport among the cooperating 
partners, which increases product prices. The quick 
changes of strategies and competition, the changes of 
the present technologies with the development of the 
new ones, and the changing buyers’ requirements are the 
impacts upon a virtual enterprise. The buyer’s influence is
an essential feature of the concept. The absence of modern 
information and communication technology inhibits the 
communications among the virtual enterprise constituents. 
The cooperating partners bear business risks. A necessary 
precondition for this is a high competence for individual 
jobs and services. The participants are fully responsible 
for the terms, quality and quantity of the products and 
services. It is important to establish cooperation despite the 
competition, because cooperating partners compete among 
each other, e.g. by the prices of their services and job 
assignments, while they participate in the same production 
network. The lack of initial financial means for starting
and developing production network is another weak point. 
It is explained by the long cycle of the turnover in wood 
processing and furniture manufacture. The economic 
indices have not confirmed a particularly high rise and
successfulness of the virtual network production.
5 Summary
In order to survive in the global environment, 
Slovenian and Croatian wood-processing enterprises must 
specialise in the fields in which they can achieve best
results, on the basis of which they could develop and create 
partnerships with complementary business partners.
However, the transformation process (virtualisation) 
of  Slovenian and Croatian enterprises is slow and accom-
16            Zbornik gozdarstva in lesarstva 84
panied by a number of strategic errors that cause crises and 
enterprise destruction.
Wood processing enterprises must learn fast, 
implement the acquired knowledge, and permanently 
develop new ideas. They must also develop a working 
environment and accept changes, because a change is 
an opportunity for survival and faster development. The 
acceptance and adjustment to these requirements are 
indispensable at the present time.
A significant application of the virtual concept
organisation at a micro-level would enable a fast and 
painless transformation of classical enterprises. At a 
macro-level, it would increase the competitiveness in 
wood industry.
According to the presented requirements of a general 
approach to the development of a virtual enterprise, 
we may conclude that such an approach enables a 
series of advantages in  wood product manufacturing, 
although there are certain disadvantages. The forests 
and forestlands of Slovenia and Croatia are the basis 
of an intensive development of wood processing and 
furniture manufacture. A guideline in a leading enterprise 
reconstruction is the acceptance of the new cooperating 
and supplying relations focused upon the virtual enterprise 
and its production network. The chief guideline of a virtual 
enterprise is the possibility that a product is made at any 
time and everywhere, in any form and size. This means 
that the whole organisation of the leading enterprise should 
be established so that it can offer its buyers individual and 
immediate supply of the desired product. This is the central 
place in the development of organisation and production 
structures, and it offers unlimited possibilities on the wood 
product market.
5 Povzetek
Če želijo slovenska in hrvaška lesno-industrijska 
podjetja preživeti v globalnem okolju, se morajo 
specializirati za področja, v katerih lahko dosežejo najboljše 
rezultate, na katerih bodo razvijala in oblikovala partnerske 
odnose s komplementarnimi poslovnimi partnerji.
Proces transformacije (virtualizacije) slovenskih in 
hrvaških podjetij pa poteka počasi ob številnih strateških 
napakah, ki povzročajo krizne situacije in propade 
podjetij.
Lesno-industrijska podjetja se morajo hitreje učiti, 
uporabljati pridobljena znanja in nenehno razvijati nove 
ideje. Poleg tega morajo razvijati tudi delovno okolje in se 
sprijazniti s spremembami, saj so prav spremembe priložnost 
za preživetje in hitrejši razvoj. Sprejemanje  in prilagoditev 
tem zahtevam je v današnjem času neizogibno.  
Večja uporaba koncepta virtualne organizacije 
na mikroravni bi omogočila hitrejšo in manj bolečo 
transformacijo klasičnih podjetij, na makroravni pa bi se 
tako povečala konkurenčnost celotne lesne branže.   
Na osnovi rezultatov raziskave in prikazanih zahtev 
po splošnem pristopu k razvoju virtualnega podjetja lahko 
zaključimo, da tak pristop zagotavlja številne prednosti v 
lesni proizvodnji, ima pa tudi določene pomanjkljivosti. 
Slovenski in hrvaški gozdovi so osnova za intenziven 
razvoj predelave lesa in proizvodnje pohištva. Ena izmed 
smeri rekonstrukcije vodilnih podjetij je sprejem novih 
odnosov s kooperanti in dobavitelji, pri čemer je treba 
težiti k virtualnemu podjetju in njegovi proizvodni mreži. 
Rdeča nit virtualnega podjetja je možnost, da se proizvod 
lahko izdela vedno in povsod, v vsaki obliki in velikosti. To 
pomeni, da se mora celotna organizacija vodilnega podjetja 
postaviti tako, da svojim kupcem omogoča individualno in 
trenutno nabavo želenih proizvodov. To je osrednje mesto v 
razvoju organizacijskih in proizvodnih struktur in omogoča 
neomejene možnosti na trgu lesnih proizvodov.
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