The impact of organizational virtuality on financial effectiveness

Purpose – The research focused on the question how the authors could assess the impact of organizational virtuality on financial efficiency using primary data from company accounting records. The paper aims to discuss these issues. Design/methodology/approach – The implemented model was based on the assumption that the authors could define virtuality with the joint effects of outsourcing and IT utilization. The authors also assumed that they could define virtuality with available financial indicators. The authors tested the model on a sample of tourist organizations in Slovenia. The main methodological challenges were hidden by diverse methods in calculating and keeping financial records in individual organizations. In some cases, the authors had to recalculate and adjust individual indicators in the particular company to make them methodologically comparable with others. As the modeling and testing tool the authors used structural equation modeling with two latent variables: organization virtuality and f...