Impact of Information Technology on Organizational Performance
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European Journal of Economics, Finance and Administrative Sciences ISSN 1450-2887 Issue 16 (2009) © EuroJournals, Inc. 2009 http://www.eurojournals.com Impact of Information Technology on Organizational Performance: An Analysis of Qualitative Performance Indicators of Pakistan’s Banking and Manufacturing Companies Muhammad Shaukat Assistant Professor of Management at Institute of Management Sciences Campus Head City Bahauddin Zakariya University, Multan Pakistan E-mail: email@example.com Muhammad Zafarullah Vice Chancellor, Bahauddin Zakariya University, Multan, (Pakistan) Abstract Information Technology(IT) is a powerful force in today global society. The advances in IT have significantly influenced the radical changes of the twentieth century. Similar to other developing countries, this technology is also being applied aggressively in all the organizations of Pakistan. This study examined the impact of IT on organizational performance with respect to different performance indicators of Pakistani manufacturing and banking sectors over period of 1994-2005. The primary data was collected through in- depth interviews and field surveys of 48 companies, 24 in manufacturing sector(12 local and 12 foreign) and 24 in banking sector(12 local and 12 foreign). The data was tested by applying different statistical techniques. The results of the research have led to the conclusion that IT has positive impact on organizational performance of all the organizations but the banking sector performance outstrips the performance of manufacturing sector. In the banking sector local companies are taking the lead, while in manufacturing companies multinationals are at the top. Keywords: Information Technology, Organizational Performance, Banking and Manufacturing IT Systems. Introduction Information Technology (IT), has been defined by many ways by many authors. William and Sawyar (2005) however gives a comprehensive definition of IT in a way that “IT is a general term that describes any technology that helps to produce, manipulate process, store, communicate, and/or disseminate information”. Shelly et. al,(2004) extended this definition by including hardware, software, databases, networks, and other related components in it which are used to build information systems. Vasudevan(2003) argues that IT, within a short span of time has become the necessity of every organization. IT is revolutionizing all the living ways and it has given a new meaning to the word “Convenience”. It is not possible now to do business without computer Long & Long(1999) demonstrate IT as a major contributor to the progress both for developing and developed countries. It 38 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) has drastically changed the business landscapes all over the world and word “IT” has become the “Catchword” of the modern life today. The organizations are making lot of investments in IT projects. It is evident from the facts that lending for IT by the World Bank has also been quite pervasive and growing at six times growth rate of total banks’ lending. Harris and Davison (1999) have investigated that the significant IT components were present in over 90% of all World Bank’s lending in developing countries in last years. It is also estimated that total annual worldwide expenditure on IT probably exceeds 1.5 trillion US dollars per year and it is growing at about 10% compounded annually (Anandarjan and Anakwe, 2002). The size of IT investments have put increasing pressure on managers to asses its business value. These massive investments on IT also created a serious dilemma for management today. It was generally accepted that increased investment in IT would naturally lead to increase performance of organization but it is not true in all the cases(Odedra and Kluizer, 1998). The impact of IT on productivity and business performance continued to be questioned, hundreds of studies have been carried out to investigate this issue and scholars are divided into two groups which can be identified as “Productivity Paradox-IT has no impacts on productivity” (Mitra and Brendt 1990;Loveman, 1994; Strassman, 1997; Dasgupta et. al, 1999) , and “Productivity Payoff-IT does improve productivity” (Attewel and Rule, 1984;Bender, 1986, Harris and Katz, 1988, Brynjolfsson, 1993, Brynjolfsson, and Hitt, 1996, 1998; Dewan and Kraemer, 1998, James, 1998, Mehmood and Mann, 2000). It remains the facts that besides various challenges now IT is the most preferred choice of all countries to upgrade their economies and become competitive in the global market place. Pakistan is a developing country, which got independence in 1947. It has about 16 billions of population and quite erratic political history. It has strong industrial base as apart from government controlled organizations, many multinational and national companies are working in the country. The process of computerization in Pakistan started since 1957 when a company named “Packages Ltd.” started using computer for its work. Since then IT usage is increasing gradually. Though in the beginning Pakistani government was slow in adoption and diffusion of IT but now it is at forefront of all government priorities. Internet service which was started in 1995 in Pakistan is being enhanced constantly, along with upgrading telephone infrastructure. IT is being used in all government and private organizations for different tasks. Now IT ministry is responsible for monitoring all the IT related issues (Kazmi, 2003;Rizvi, 2005). Many other departments/institutes like Electronic Government Directorate, Pakistan Computer Bureau, Pakistan Software Export Board, Pakistan Telecommunication Authority, Computer Society of Pakistan, Pakistan Software Houses Association (PASHA) etc. are working side by side the Ministry of Information Technology to promote use of IT in the country.(Kazmi, 2005). According to some estimates, in Pakistan presently there are around 3,400 mainframe and minicomputers in the country with nearly half of them being in the government sector. Liberal import policy and reduction/removal of duties have led to a burgeoning usage of PCs and servers (Osama, 2005). It is estimated that nearly half a million PCs are added each year, representing a three fold increase in annual volume over the decade straddling the 21st Century. Analysts estimate that this rate of growth could very well quadruple by 2010 in Pakistan(Ghauri, 2003; Pasha, 2005). All in all with all the support of Government of Pakistan the intensity of use of IT in a variety of fields is increasing. Financial sector appears to be a clear leader in the use of IT. Financial institutions are one of the largest investors in IT(Gupta and Collins, 1997). Martini (1999) while narrating the history of computer usage in banking says that the use of computers in banking first began in the early 1950s, when the first large commercial computer was built for Bank of America. Automated Teller Machine (ATM) (Don Wetzel developed ATM in 1973 and it was first installed at Chemical Bank in New York(Shelly et. al. (2004)), is considered one of the most significant technological investments made by the commercial banks. ATM’s introduced the power of computer technology to the general public and made banking convenient for consumers (Nsouli, 2002). There is a phenomenal progress in banking sector of Pakistan over last decade. It recorded an increase of 99% growth in profit in only one year, i.e. 2005 (Mahmood, 2006; The Dawn, March 21, 2006). NBP, HBL, MCB, ABL,UBL are considered five large banks and are dominant in the banking industry , in term of total number of 39 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) branches, deposits and advances, collectively accounting for 78% and 77% of total deposit and advances respectively. Most of the local banks are in private sector now, and many of them have started business since 1992 (SBP report, 2005). The introduction of computer in banks in Pakistan started in 1965 when the main commercial banks in private sector i.e. Habib Bank, United Bank and Muslim Commercial Bank started acquiring computers to automate their banking work in the areas of operations, check handling, bookkeeping, credit analysis etc. Since that time there is a massive investment in IT in banking sector (Akhtar, 2006a, 2006b). The most recent automated banking systems like Misys, Sibel, and Fidility etc have been are being installed in many of the Pakistani banks (Kazmi 2004). The manufacturing sector is also not lacked behind in use of IT. A researcher named Ho(1996) demonstrates that automation in manufacturing organizations goes back to 1900. Around the year 1900, factory mechanization facilitated mass production to meet the consumers’ demands for improves products. In the year 1930, transfer lines and fixed automation were created to facilitate mass production. (Sohal et. al, 2001). Like other companies now IT has become necessity for every manufacturing industry. It is becoming critical to many manufacturing organizations that want to be a world-class manufacturer as IT often provides a manufacturing based advantage. In Pakistan, industrial sectors is growing at a much faster pace than agriculture and services now and if this pace is sustained, its share in GDP is likely to rise further in the medium term(Federal Bureau of Statistics, 2005). As discussed earlier, in manufacturing sector of Pakistan, Packages Ltd. was the first company, which started using computers in 1957. After that many other companies in this sector started using computer to increase their productivity. Now IT usage in manufacturing and industrial sector is very common (Mujahid, 2003). The use of advanced software systems like Enterprise Resource Planning (ERP) software (an integrated IT software system comprised of several modules that share a central database, designed to automate business process across the enterprise, is increasing(Thomas and Michael, 2001, Shaukat et.al, 2009). Packages such as SAP and Oracle are being used commonly in almost most of the organizations(Rizvi, 2005; Shahid, 2005). The performance of these companies in both the sectors has tremendously increased with the use of these latest systems. (Shaukat et.al. 2009). The performance as stated by Wheelen and Hunger(2000) is an end result of an activity and an organizational performance is accumulated end result of all the organization’s work process and activities. It is necessary for the management of the organizations to measure and assess the organization performance to use organizations resources in a better way and to earn good organization repute. Managers measure and control organization performance because it leads to better asset management, to an increased ability to provide customer value, to improve measures of organizational knowledge and measure of organizational performance do have an impact on an organization’s reputation. The most frequently used organizational performance measures include the organization efficiency (productivity), organizational effectiveness and industry ranking (Wetherbe et. al., 1999). Efficiency is defined as “minimum utilization of resources and getting maximum output” and effectiveness is “how well the job gets done” (Robbin and Coulter, 2003). Various studies have been undertaken to measure the impact of IT on organizational performance (efficiency & effectiveness) of business organizations using different performance indicators which are considered key factors for assessments. These variables include income, customer satisfaction, supplier/customer links, company image, job interest of employees, stake holder's confidence and interoffice links etc. Many researchers have investigated the impact of IT on organization performance using these variables. Researchers like Parthasamthy and Sethi(1993), Kelly(1994), Earls et. al. (1996), O’Dell and Elliot (1999) etc. have investigated the impact of IT on quantitative performance variable i.e. incomes/profits of the companies and found positive impact. Whereas, Franklin (1997), Olalla (2000), Schmid et. al(2001), Zee and Han(2002) etc. have seen the increase/decrease in different qualitative performance indicators i.e customer satisfaction, company image, job interest of employees, stake holders confidence, interoffice link etc. after implementation of IT and have concluded that IT ultimately has positive impact . This study also measured the 40 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) increase/decrease in organizational performance based upon qualitative indicators, mentioned above, for Pakistani companies operating in banking and manufacturing sectors after implementation of IT. For each performance indicator two different research hypotheses have been tested given as under: Research Hypothesis(1): “There has been substantial increase with respect to the given performance indicator in the given sector, after implementation of IT.” Translation of this in terms of statistical hypotheses is as under: H0: μ ≤ 2 H1: μ > 2 This one-sided hypothesis was tested using t-test statistic at level of significance of 0.05 for each performance indicator. Rejection of the null hypothesis stands for acceptance of the research hypothesis. Research Hypothesis(2): “The change in the given performance indicators after implementation of IT is not the same in all the four sectors”. Translation of this in terms of statistical hypotheses is as follows: H0: μ1 = μ 2 = μ 3 = μ 4 H1: At least two μ’s are different. This hypothesis was tested using one way ANOVA technique at level of significance of 0.05 for each performance indicator. Again, the rejection of the null hypothesis means, the acceptance of the research hypothesis. Rejection of the null hypothesis implies that not all means are same i.e. all means may be different or some may be same or some may be different. The post hoc tests about pair- wise comparison ( H 0 : μ i = μ j vs. H1 : μ i ≠ μ j for i ≠ j ) were also performed using Scheffe test statistic. Table I: One way ANOVA Results Summary IT Adoption Benefits For all Companies n=48 Sr. no Variable Name ANOVA Results ANOVA Results Average Mean F-Value p-value 1 Customer Satisfaction 2.4143 4.655 .007 2 Better Customer/ Service Links 2.3958 7.702 .000 3 Company Image 2.7500 .277 .842 4 Job Interest of Employee 2.5833 4.423 .008 5 Stake Holder Confidence 2.5000 1.782 .165 6 Inter Office Links/Communication 2.6875 1.658 .190 Methodology There are two population groups for this research. One is the banking sector and the other is the manufacturing sector which is making use of latest IT. In the sample 48 companies, 24 in banking sector (12 foreign, 12 local) and 24 in manufacturing sector (12 foreign, 12 local) were taken. List of sample companies is given in Tables VIII and IX. About 40 commercial banks are operating in Pakistan at present, out of these 40 banks, 24 banks are included in the sample because of the reasons that many other banks are either set up in few years back or do not have well established network in Pakistan, therefore, they do not serve the purpose of this research. There is no definite information available relating to the size of large manufacturing sector. It is estimated however that about 1800 large-scale manufacturing units are operating in Pakistan (Saeed, 2005). Therefore, in the sample, from the manufacturing sector, a total of 24 big organizations were randomly included. All these companies have well established business standings and IT set up since long. The sample size could have been increased but the nature of problem seems to be similar in each case. So the chosen sample size is considered to be sufficient. 41 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) The participants in the study were the staff and managers of finance, human resources, marketing and IT departments of the companies in sample. The data was captured from in-depth interviews using a structured close-ended questionnaire, and perusing official documents, detailing different aspects pertaining to the study. The response options of respondents were anchored in a three-point scale ranging from 1(no increase), 2(moderate increase) and 3 (high increase) for each benefit. For discussion purpose “Substantial increase” has been defined as “above average’ i.e. average score greater than 2 or μ > 2 . Increase in all the indicators has been observed for all companies in both sectors. The statistical software package named SPSS 12.0 has been used for analysis. According to the problem/requirement, statistical techniques such as t-test, one way ANNOVA test etc. have been applied. Results And Discussions The performance indicator wise analysis is discussed as under; 1. Customer Satisfaction The test shows an ‘above average’ increase in customer satisfaction for banking sector (p<0.05) but not so increase in manufacturing (p>0.05). This is confirmed when sector wise comparison is made between banking and manufacturing sectors. It indicates that there is substantial increase in customer satisfaction in banking sector but not so increase in manufacturing sector. Table II represents summary of all the results of t-test for customer satisfaction. In conclusion, we can say that after implementing IT, there has been increase in customer satisfaction in all four sectors of the economy and this increase has been substantial or above average in case of entire banking sector but not for manufacturing sector. In individual sector analysis it is observed that p-value for local banks and foreign banks is less than 0.05, and for local manufacturing and foreign manufacturing it is greater than 0.05. Table II. This implies an ‘above average’ increase in customer satisfaction for banking sector but not so increase in manufacturing. This is confirmed when sector wise comparison is made between banking and manufacturing sectors, again it appears that p-value for banking sector is less than 0.05 and for manufacturing sector it is greater than 0.05. Though means for both the sectors are greater than 2 but value of means for manufacturing sector is not so significantly greater. It indicates that there is substantial increase in customer satisfaction in banking sector but not so increase in manufacturing sector. In overall comparison of all the four sectors, we note that p-value is far below 0.05 and average means are greater than 2. It shows that there is substantial increase in customer satisfaction in all the four sectors. In conclusion, we can say that after implementing IT, there has been increase in customer satisfaction in all four sectors of the economy and this increase has been substantial or above average in case of entire banking sector. Table II: Results Summary of One-Sample t-Test Customer Satisfaction Sector N Mean t-statistics p-value Banking 24 2.67 6.78 0.000 Manufacturing 24 2.12 1.14 0.133 Local Banks 12 2.75 5.74 0.000 Foreign Banks 12 2.58 3.92 0.001 Local Manufacturing 12 2.08 0.43 0.337 Foreign Manufacturing 12 2.17 1.48 0.083 The ANOVA results given in Table I shows that customer satisfaction has not increased in all the sectors uniformly (p = 0.007<0.05) thus, supporting above conclusions. This represents that all the four sectors have benefited with customer satisfaction but differently by adopting IT. Scheffe test 42 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) further revealed in pair-wise comparison that customer satisfaction level differ between banking and manufacturing industries. There is difference between sector 1 (local banks) and sector 4 (Local manufacturing),1 (local banks) and 3 (foreign manufacturing) as shown diagrammatically below; Figure 1: Schematic diagram for ordered means Sectors 4 3 2 1 Means 2.08 2.17 2.58 2.75 _______________ ______________ We conclude our discussion on this trait by observing that in general IT has increased customer satisfaction but this increase is greater in banking sector, particularly local banks as compared to manufacturing sectors. The possible reason of this difference could be, that banking sector has introduce modern technological innovations relating to interactive customer services such as ATM, On-Line banking, Call Centers, Mobile banking, Internet banking and other E-banking facilities, which are very much visible to the customers and they are benefiting directly from these. Conversely, manufacturing sector has lagged behind until recently in such type of technological services as most of the companies in this sector are still using IT for ‘traditional systems’ for which customer has no direct interaction/interest. 2. Better Customer/ Supplier Links In customer/supplier links substantial increase has been observed in all the companies (p<0.05) except local manufacturing (p>0.05). If we look at both the sectors and all the companies combine, except for manufacturing sector, there has been substantial increase in customer/supplier links in all companies, banking sector (p-value <0.05). Table III represents summary of all the results of t-test for customer/supplier links. First we analyzed the performance of individual sector with respect to above indicator and then performance is analyzed as a whole. This analysis revealed that p-value for local, foreign banks and foreign manufacturing is <0.05, while for local manufacturing it is > 0.05. It implies that although increase in customer/supplier links has been observed for all sectors but substantial increase is in all the companies except local manufacturing. If we look at both the sectors and all the companies combine, except for manufacturing sector, there has been substantial increase in customer/supplier links in all companies, banking sector (p-value <0.05). Table III: Results Summary of One-Sample t-Test Better Customer Links Sector N Mean t-statistics p-value Banking 24 2.60 4.90 0.000 Manufacturing 24 2.25 1.66 0.055 Local Banks 12 2.75 5.74 0.000 Foreign Banks 12 2.42 2.16 0.027 Local Manufacturing 12 1.75 -1.39 0.904 Foreign Manufacturing 12 2.75 5.41 0.000 ANOVA results as given in Table I indicates that the customer/supplier links has been increased in all the sectors but differently (F= 7.702, p-value <0.05). This represents that all the four sectors have benefited with customer/supplier links but differently by adopting IT. The subsequent Scheffe test statistics for pair-wise comparison showed that customer/supplier links differ between banking and manufacturing industries as shown below. Customer/supplier links has also been different for local banks and local manufacturing and between local banks and foreign manufacturing. The 43 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) highest mean, 2.75 for sector 1, is significantly greater (or different) than means 2.42 for sector 2 and 1.75 for sector 4. The mean 2.67 for sector 3 is significantly greater than mean 1.75 for sector 4. Figure 2: Schematic diagram for ordered means Sectors 4 3 2 1 Means 1.75 2.42 2.67 2.75 _______________ ______________ It is summarized that customers/supplies links for all companies, for banking sector and foreign manufacturing has increased substantially. Increase in foreign manufacturing is higher then all other sectors but no increase in local manufacturing companies. These differences are not surprising given to the facts that most of the banking and foreign manufacturing organizations are using state-of-the-art IT systems including SAP/Oracle ERP systems which have given them a competitive edge over other companies and improved their customer/supplier links, while except few most of local companies are still relying on their old system. Table IV: Results Summary of One-Sample t-Test Company Image Sector N Mean t-statistics p-value All Banking & Manufacturing 48 2.75 11.87 0.000 Banking 24 2.71 7.47 0.000 Manufacturing 24 2.80 9.35 0.000 Local Banks 12 2.75 5.74 0.000 Foreign Banks 12 2.67 4.69 0.000 Local Manufacturing 12 2.67 4.69 0.000 Foreign Manufacturing 12 2.92 11.00 0.000 3. Company Image The analysis showed that p-value for overall all the companies, for banking and manufacturing sectors, for local, foreign banks and for local, foreign manufacturing is far less than 0.05. It reflects that there is substantial increase is company image for all the individual company and all the sectors. Table IV reports results of t-test for company image. ANOVA results reported in Table I indicate that the company image of all the sectors has increased uniformly (F= .277 and p-value = 0.842 >0.05). Since IT is being used extensively in all the sectors of sample so, it has increased the company’s image in the mind of all the stack holders of these companies. They feel that more accurate performance/results are an outcome of IT. IT usage leaves good impression in the mind of peoples who have or not have any concern with the company and IT has now become the necessity for daily office work, not only the symbolic thing. 4. Job Interest of Employees The results (Table V) shows that the p-values for local banks, local and foreign manufacturing is less than 0.05 which implies that job interest of employees in all these sectors have increased substantially. 44 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) Table V: Results Summary of One-Sample t-Test Job Interest of Employees Sector N Mean t-value p-value Banking 24 2.33 2.89 0.004 Manufacturing 24 2.80 9.35 0.000 Local Banks 12 2.42 2.80 0.009 Foreign Banks 12 2.25 1.39 0.096 Local Manufacturing 12 2.83 7.42 0.000 Foreign Manufacturing 12 2.75 5.74 0.000 Again ANOVA results as given in Table I further prove that the job interest of employees in all the sectors have increased but differently (F= 4.423 and p-value = 0.008 <0.05). This means that all the four sectors have benefited with increased job interest of employees but differently by adopting IT. Furthermore, Scheffe test statistics for pair-wise comparison reveals that job interest of employee differ for banking and manufacturing industries as shown below. The highest mean, 2.83 for sector 4, is significantly greater (or different) than means 2.25 for sector 2. The mean 2.83 for sector 3 is significantly greater than mean 2.25 for sector 2 and 2.42 for sector 1. Figure 3: Schematic diagram for ordered means Sectors 4 3 2 1 Means 2.25 2.42 2.83 2.83 _______________ ______________ In brief, we conclude that IT has substantially increased job interest of employees as IT facilitates the employees to carrying out all their daily official jobs/activities. The jobs/work which created boredom for employees in the past now are matter of more interest because of IT ease. In Pakistan, like world initially employees were reluctant to use IT but after seeing its benefits/growth world wide, they are forced to use IT more and their dependence on IT has also increased. 5. Stake Holder Confidence The analysis guided to the facts that p-value for local, foreign banks and foreign manufacturing is less than 0.05, while for local manufacturing it is greater than 0.05. It means that although increase in stake holder confidence has been observed for all sectors but substantial increase is in all sectors except local manufacturing. The individual and overall sector wise analysis also indicated that there has been substantial increase in stake holder confidence in all companies and banking sector (p<0.05) except for manufacturing sector where p >0.05. Table VI exhibits summary of all the results of t-test for stake holder confidence. 45 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) Table VI: Results Summary of One-Sample t-Test Stake Holder Confidence Sector n Mean t-value p-value Banking 24 2.46 3.82 0.000 Manufacturing 24 2.54 3.68 0.001 Local Banks 12 2.42 2.16 0.027 Foreign Banks 12 2.50 3.32 0.003 Local Manufacturing 12 2.25 1.00 0.169 Foreign Manufacturing 12 2.83 7.42 0.000 Again ANOVA analysis in Table I shows that there is uniform increase in stake holder confidence in all the sectors (F=1.782, p=.165 > 0.05). This represents that all the four sectors have benefited with customer/supplier links but in same way by adopting IT. It is inferred overall that stake holder confidence for all companies, for banking sector and foreign manufacturing has increased substantially. Increase in foreign manufacturing is higher than all other sectors but no substantial increase in local companies. It can be argued that these differences are due to the facts that use of IT in the companies has given rise to accuracy/performance, resulting therein an increase in the confidence of its stack holders. 6. Interoffice Links The analysis shows that p-value for local, foreign banks and foreign manufacturing is less than 0.05, while for local manufacturing it is found to be greater than 0.05. It means that there is substantial increase in interoffice links for all sectors except local manufacturing (Table VII). Table VII: Results Summary of One-Sample t-Test Interoffice Links Sector n Mean t-value p-value Banking 24 2.67 5.13 0.000 Manufacturing 24 2.71 5.03 0.000 Local Banks 12 2.67 3.55 0.002 Foreign Banks 12 2.67 3.55 0.002 Local Manufacturing 12 2.42 1.60 0.069 Foreign Manufacturing 12 2.80 7.90 0.000 Similar to above again ANOVA results as shown in Table I for this indicator indicate that the interoffice communication links has been increased in all the sectors but uniformly (F=1.658, p = 0.190 > 0.05). This represents that all the four sectors have benefited with same level increased interoffice communication. Conclusions It is concluded from the above discussions that IT is a general term that describes any technology that help to produce, manipulate, store and disseminate information. It has revolutionized and redefined social and business scenario. Like world, in Pakistan too banking and manufacturing industries are also using IT to increase their performance. IT has changed the nature of working for both the industries. The recent advances in IT have changed the way these organizations work. The implementation of IT has positive impact on these sectors of economy. This positive impact has been demonstrated in qualitative performance indicators. Significant improvements with respect to different qualitative variables such as customer satisfaction, customer/suppliers links, company image, job interest of employees, stake holders’ confidence and inter office links/communication have been observed. Such improvements and enhancements in performance with respect to the indicators studied have been substantial in both the sectors and banking in particular. 46 European Journal of Economics, Finance And Administrative Sciences - Issue 16 (2009) Overall, it is observed that though there is an increase in all performance indicators as discussed above but IT has facilitated significantly interoffice communication links, particularly, for all the sectors and it has really changed the working pattern of all the organizations to facilitate them to establishing the quick links among all the offices across the world. It is owing to the reasons that almost all the companies now are using Internet, Intranet to greater extent though ISDN, DSL, Radio and VSAT etc. links. These links provide 24hrs speedy connectivity among all the offices located across the country and world. The implementation of IT really has opened new and wider business avenues in both the sectors of the economy. Table VIII: List of companies in sample: Banking Sector. List Of Local Banks List Of Foreign Banks 1 Habib Bank Ltd. 1 American Express Bank Ltd. 2 National Bank Ltd. 2 Citibank N.A. 3 United Bank Ltd. 3 Habib Bank AG Zurich 4 Muslim Commercial Bank Ltd 4 Algemene Bank Netherland (ABN Amro) 5 Bank Al Habib Ltd 5 Internaional Islamic Bank 6 Metropolitan Bank Ltd. 6 Deutsche Bank A.G. 7 Bank Of Punjab 7 Rupali Bank Ltd. 8 Askari Commercial Bank Ltd. 8 Standarad Charterd Bank 9 Bank Alflah Ltd. 9 Oman International Bank Ltd. 10 Allied Bank Ltd. 10 Bank Of Tokyo Ltd. 11 Faisal Bank Ltd. 11 Mashraq Bank Ltd. 12 First Women Bank Ltd. 12 Hong Kong & Shangai Bank Ltd. Table IX: List of companies in sample: Manufacturing Sector. List Of Pakistani Manufacturing Companies. List of Foreign Manufacturing Companies 1 Packages Ltd 1 Uni Lever Pakistan Ltd. 2 General Tyres Ltd. 2 Reckett Benkiser Pakistan Ltd 3 D.G. 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