THE EFFECT OF INFORMATION TECHNOLOGY ON CORPORATE PERFORMANCE OF AND ORGANIZATION

ABSTRACT

This project work takes a look at the effect of information technology on corporate performance of an organization  with reference to  Guaranty Trust Bank Plc, the study is meant to find out the problems encountered by accountants in carrying out their banking works in the course of the research survey. employee were made to cope with the demands of Information and Communication Technologies (ICT) dominated global banking industry but despite these achievements Nigerian banks have witnessed severe downturn in their profit and many of them have almost collapsed. It was discovered that some of those problems such as shortage of skilled manpower, accelerated obsolescence, excessive power failure, poor communication, inadequate financial resources and low level of industrialization in the country at large are dealt with. The data analysis used for this research was chi-square analysis,  it enable us to discover that putting this aforementioned in place, will enable us attend to those non-quantitative duties within the banking sector such as time saving both to bank staff and customers. It will drastically reduce waste and cost, also it leads to more accuracy and increase speed in preparation of financial statement including staff and customers data in the bank. Computer and telecommunication systems have become very important delivery system and productivity tools of electronic data and information. Nigerian financial institution such as Guaranty Trust Bank Plc, has now realized that financial services today require prompt delivery services, efficiency and the ability of customer to be served in any of their braches in any part of the country. Hence the level of information technology has a positive impact on banking operation such as Guaranty Trust Bank Plc. The result obtained from responses shows that introduction of computer facilities has greatly improved the services of financial institutions.

CHAPTER ONE

INTRODUCTION

1.1   Background of the Study

Information Technology (IT) “is a general term that describes any technology that helps to produce, manipulate process, store, communicate, and/or disseminate information” William Sawyar (2005). Other researcher named Shelly et. Al (2004) say that IT includes hardware, software, databases, networks and other related components which are used to build information systems. As a need IT progressed along with socio-economic development in developing countries. In a very short time IT, with rapid growth has become the back bone in modern industrial society and the major contributor to the progress of both developing and developed countries (Vasudevan, 2003; Long and Long 1999).

Through declining cost, both in hardware and software, IT has spread very rapidly into all the industries of Pakistan. In 1957 “Packages limited” has started the process of computerization in Pakistan and it is considered the first company in Pakistan, which started using computers. Though, in International Research Journal of Finance and Economics – Issue 39 (2010) 

In the beginning Pakistani Government was reluctant to adopt IT but now in every private and government organization computer is at fore front. In Pakistan internet service was started in 1995 along with upgrading telephonic infrastructure. Now IT related issues/matters are being monitored by IT Ministry in Pakistan (Kazmi, 2003; Rizvi, 2005). Many other departments like Electronic Government Directorate, Pakistan Computer Bureau, Pakistan Software export board, Pakistan Telecommunication Authority, Computer Society of Pakistan are also working side by side IT Ministry to boost IT in the country(Ghauri, 2003, 2006a, 2006b).

Financial sector is the major user and large investor in use of IT. It was among the first to incorporate electronic data processing in its operations, through cheque handling, bookkeeping credit analysis and ATMs (Bender, 1986; Martini, l999; Vasudevan, 2003). The computers usage in banking sector first started in the early l950s. Bank of America was the first user of computer in banking sector. The use of Automated Teller Machine ATM. (Developed by Don Wetzel in 1973) was greatest achievement of online and real time automation by the commercial banks. ATM was first installed at Chemical bank in New York (Shelly and Cashman 2004). In Pakistan banking sector is also progressing rapidly with growth of local and multinational banks (Mabmood 2006). Many local banks are working in private sectors and started their operations since 1992 (SBP Report, 2005). It was year 1965 when computer was introduced first time in banks in Pakistan. The main commercial banks in private sectors i.e Habib Bank, United Bank, Muslim Commercial Bank started acquiring computer to regulate their banking work since that year (Hussain, 2003, Akhtar 2006a, 2006b). The most recent automated banking systems like Misys, Sibel and Fidility etc have been installed in many of the Pakistani Banks (Kazmi 2004, 2005; Shaukat et. al, 2009).