A neural network model for the assessment of partners’ performance in virtual enterprises

In response to increasing international competition, enterprises have been investigating new ways of cooperating with each other to cope with today’s unpredictable market behaviour. Advanced developments in information & communication technology (ICT) enabled reliable and fast cooperation to support real-time alliances. In this context, the virtual enterprise (VE) represents an appropriate cooperation alternative and competitive advantage for the enterprises. VE is a temporary network of independent companies or enterprises that can quickly bring together a set of core competencies to take advantage of market opportunity. In this emerging business model of VE, the key to enhancing the quality of decision making in the partner companies’ performance evaluation function is to take advantage of the powerful computer-related concepts, tools and technique that have become available in the last few years. This paper attempts to introduce a neural network model, which is able to contribute to the extrapolation of the probable outcomes based on available pattern of events in a virtual enterprise. Quality, delivery and progress were selected as determinant factors effecting the performance assessment. Considering the features of partner performance assessment and neural network models, a back-propagation neural network that includes a two hidden layers was used to evaluate the partner performance.