Virtual Enterprise (VE) is an organizational business concept. Its key ingredients are collaboration among a set of member companies and integration of their competencies, which are needed for developing a new product or service. This concept is in response to the ever-increasing demand on the manufacturing enterprise to react quickly to changes in the market conditions and become agile enterprises.  

This thesis presents a quantitative study on the life cycle of Virtual Enterprises. Specifically, it covers the design and management phases. These two phases are modeled using system engineering as a foundation.   This has led to the development of two new methods for designing and managing Virtual Enterprises. The design method uses Axiomatic Design Theory and a methodology for complex large systems. The management method is based on the Robust Design principles