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  • 1. INFORMATION TECHNOLOGY AND SUSTAINED COMPETITIVE ADVANTAGE IN SRI LANKAN BANKING SECTOR MS. Nuwani U. Amaratunga and MS. M.S.F. Mukrima Faculty of Management & Finance, University of Colombo, Colombo 03. nuwani@webmail.cmb.ac.lk, fmukrima@yahoo.com ABSTRACT Information Technology(IT) is having a significant impact on an organisational life. It is an asset used as a competitive strategy. This facilitates the changes in organisational processes, its own strategies, structures and functions. Financial services industry has become virtually dependent on and continues to invest in IT to gain a competitive advantage. IT has the ability and to enhance differentiation. Rising competition in the Sri Lankan banking industry has further widened the scope of IT. Therefore this study is to find out whether Sri Lankan banks use IT to gain a competitive advantage over each other. Michael Porters Five Forces Model is used as a tool to analyse data. It revealed that IT has been used by two banks to gain competitive advantage in relation to banking services. Also focus and differentiation strategies also have been adopted by these banks. as a competitive tool. The study also evidenced that inability to assess strategic opportunities, lack of strategic information system planning, lack of coordination, lack of top management support and lack of infrastructure facilities inhibit the competitive advantage over IT. Hence, it can be concluded that the Sri Lankan banks should give a further thought to IT as a competitive edge. Key words: Competitive advantage, Information system, Porter’s Five Forces Model
  • 2. 1. INTRODUCTION Information system (IS) for gathering, processing and disseminating information has been an integral part of every organization’s processes forever. However, the arrival of technologies, which were cable of helping carry out those processes, changing them, eliminating the need for some of them and enabling new processes to be developed, has made the management of information systems a subject needing specific attention. Ensuring potential of Information technology is a harness in an increasingly uncertain and complex environment. This was traditionally a challenge for managers in major corporations, but the ever-improving economics and capabilities of information technology (IT) have meant that in every size of IT is now an item on the management agenda. Information is a major resource and the proper handling will allow the organization to achieve an edge over their competitors: competitive advantage. Good information is information, which has value to the user. It is useful to the recipient, can be relied upon and could not continue service without computes and the information they make available. Value of he information leads to reducing unnecessary costs, adapting better than its rivals will be able to give a better service at a lower cost and so will make better long term profits. For many firms, information technology has become a strategic focus. In that sense how sooner the computer systems are being planned and developed will be a critical factor. This will definitely influence the organisation’s survival or growth. However in the past information technology has been a lower profile activity. Bradmore (1996), has noted the demanded for management information continuous to grow as organisation’s become more complex in scale and scope, as the environment becomes more uncertain as the rate of change of key business-not least technology it self accelerates (Earl, 1989:14)
  • 3. Competitive advantage involves providing better service through deeper knowledge of customer. The idea is that Banks have developed or learned information about their customers' needs and process can serve that customer better than their competitor can. 1.1 Evolution of banking industry in Sri Lanka In the early nineteen fifties, the banking industry in the country was confined to 16 commercial banks, out of which nine were foreign and held more than 60% of banking assets. None of these commercial banks saw any reason to extend their services to rural areas, and then home to nearly 85% of the population. They were essentially graces to serve the plantation industry and the import-export trade. The wide spread IT usage in the Sri Lankan banking sector began only in the late nineteen eighties, with initiatives taken by a few private banks. This IT wave brought the computer terminals out of the air- conditioned and entry restricted computer rooms to the teller countries. The transactions were carried out on-line against the batch processing mode used earlier and the manual work was gradually replaced by the automated procedure. Online real-time computer operations. This breaks the barrier of confining a customer to a branch, but making the resource of the bank available to them, anywhere, anytime. With the expansion of the computer network was also more than doubled. The card base too was expanded aggressively. The bank continually enhances the richness of its IT based product and services. Today customers enjoy services through Internet banking, Tele-banking, Mobile telephone banking (provided through both Short Message Service and WAP technologies) and Visa Electron/Visa Credit card facilities. A notable feature is the integration of an e-trading hub with Internet banking and the bank’s web-site Technology has changed the contours three major functions performed by banks. i.e. access to liquidity, transformation of assets and monitoring risk. Further information technology and communication network systems have a critical bearing on the efficiency of money, capital and foreign exchange markets. Entry of new Banks resulted in a paradigm shift in the ways Banking in Sri Lanka. The growing competition growing expectations led to increase awareness amongst Banks on
  • 4. the role and importance of technology in Banking. The arrival of foreign and private Banks with the superior state-of-heart technology-based services pushed Sri Lanka also to follow suit by going in for the latest technologies so as to meet threat of competition and retain customer base. 1.2 Objective of the study This study was undertaken to find a solution to the question of Does IT lead to sustain competitive advantage in Sri Lankan Banking Sector? , having following objectives in mind. 1) To identify the products/services which have a competitive advantage over IT 2) To examine whether these products have created an entry barrier, reduced the competition, had controlled bargaining power of suppliers and customers and the threat of substitutes. 2. INFORMATION TECHNOLOGY AS A COMPETITIVE TOOL Organization will put forward number of reasons as to why they have interest in information technology. The most common includes the need to sustain and improve competitive position, to increase revenue or reduce costs or to improve flexibility and responsiveness. While there are important, many organizations are driven simply by the need to survive in a highly competitive market place. Thus while it could be argued that Bank installed Automated Teller Machine (ATM) to increase customer service, the reality is that once one Bank had installed Automated Teller Machines competitors were left with little choice but to match that investment as the price that has to be paid to stay in the market. While it may be difficult to qualify the benefits of investing in information technology the downside of taking no action is often starkly. Peppard (1993), had identified the following reasons as to why information technology has become increasingly strategic in nature. 1. The cost of maintaining exiting systems and the significant investment in time and money required to develop new systems. The long term nature of information
  • 5. technology investment and the time it can take to develop a new system demands that organizations strategically plan their requirements. 2. Information Technology has an increasingly important role to play in corporate strategy as it significantly impacts the choice of option open to a company and plays an important role in the effective implementation of a corporate strategy. 3. Information Technology affects the process of strategy development as it provides more information to managers through the use of expert systems and executive information systems. 4. Information technology permeates the way organizations are structured and managed. Top management has greater access to information and a reduced reliance on middle management to source that information. Information technology has the potential to integrate different parts of the organization and provide more information to managers. 5. As well as affecting internal organization information technology also impacts the organization interfaces with the external environment. This is having an affect on the organization’s long term relationship with customers and suppliers. 6. While representing a significant hardware and software investment information technology also involves making a significant investment in people and in the way they do their work. Information is now treated as a corporate resources and competitive weapon and the focus now is on exploiting information technology for competitive advantage. Being competitive in the 21st country will depend on the effective use and application of information technology to mange the information resources. Information technology helps a business in reshaping itself to the changing environment . in this role information technology with its strategic perspective helps an organization to achieve internal as well as external advantage. By applying information technology in a novel way it is possible to gain a competitive advantage over competitors. Probably most widely cited example of the application of information technology for competitive advantage is the American Hospital Supplies
  • 6. Company (AHS) who established direct information technology links with their customers by giving them terminals linked directly to their computer systems. Peppard has quoted that Porter and Miller propose that the influence of information technology has been so far reaching as to alter fundamentally the rules by which firms in an industry compete with each other. They content that it is changing the nature of competition in three particular ways. (Peppard, 1993:56) 2.1 Why business need IT ? IT is reshaping the basics of business. Customer service, operations, product and marketing strategies and distribution are heavily, or sometimes even entirely, dependent on IT. The computers that support these factions can be found on the desk, on the shop floor, even the briefcases. IT and its expense have become an everyday part of business life. Information systems perform three vital roles in any type of organization. It supports business operations, managerial decision making and strategic advantage. In today’s context mangers have felt the need of a “technology” to derive the maximum benefits of information. Also their firms are being buffered on all sides by strong, frequently shifting winds of change. Organizations’ strategic objectives (chosen markets, product strategy, expected outcomes)and their business process (such as research and development, production, cash-flow management and order fulfilment) are undergoing significant and volatile changes, placing greater pressure on forms and their managers. The rapid pace of change in today’s business environment has made information system and IT vital components that help keep an enterprise on ingredient in several strategic thrusts that businesses have initiated to meet the challenge of change. These include the internetworking of computing ,internetworking the enterprise ,globalization, business process reengineering ,using IT for competitive advantage .they are just some of the major reasons why today’s business need IT. 2.2 Frame works of information technology
  • 7. Frame works provide a structure to analyse the issue and also to understand the relationship between competitive strategy and information technology. Number of authors has put forward several frame works that help managers identify potential strategic information systems. Many of these have origins in Porter’s work an obtaining a competitive advantage within an industry. A brief outline of some of the frame works are describe below. 1. Michael Porter (1979) first presented a succinct and lucid view of the factors shaping competition. Porter views an industry as consisting of firms jockeying for preferred positions while being impact by the bargaining power of suppliers, the bargaining power of customers, the threat of new entrants, and the threat of substitute products or services. These forces, affecting all competitors must be contented with strategically by the firm if it is to go grow and prosper. Porter suggests that companies need to address strategic action based on the factors identified in the model. These actions consist of diminishing customer or supplier power, lowering the threat of substitute products entering the market place, discouraging new entrants, or gaining competitive edge within the existing industry. Figure: 1 Michael Porters competitive models
  • 8. Source: Roger Clark, The Path of Development Strategic Information System Theory, Version of 14 July 1994, p 1-19. 2. Mc Farlan ( 1983) subsequently mapped the competitive application of information system onto Porter’s Five Forces Model. He proposed five questions for assessing the strategic impact of information system of a firm. If a particular question is answered the affirmative, he concluded that a strategic opportunity exists. The five questions are as follows: (i). Can information system be used to build barriers against new entrants? (ii). Can information system the basis of competition? (iii). Can information system be used to generate new products? (iv). Can information system be build in switching costs? (v). Can information system change the balance of power in supplier relationships?
  • 9. 3. Charles Wiseman’s discussion gives insight into the theory of thrusts to and is compete with numerous examples of strategic information systems. The ingredients of these strategic moves are contained in five basis thrusts. Carrol W. Frenzel has added “time” as a strategic thrust to the five defined by Wiseman C Frenze (1991:46) (i). Differentiation: the firm’s products or services are distinguished from competitors’ product or services or a rival’s differentiation is reduced. (ii). Cost: advantage is attained by reducing costs to the firm, the firm’s suppliers or its customers or by increasing costs to competitive (iii). Innovation: advantage is gained by introducing changes to the product or process, yielding fundamental charge to the market in which the industry conducts its business. (iv). Growth: advantage is secured by expansion, forward or backward integration; or by diversification in products or services. (v). Time: especially the reduction in time or the increase in responsiveness, is an important factor in business competition in today’s environment. Time must be considered a strategic thrust. 3. METHODOLOGY 3.1 Research approach A qualitative research approach was adopted along with a conceptual model. This approach is primarily exploratory and interpretative rather than descriptive and displays a visual format that presents information systematically. Therefore, researcher can draw a valid conclusion and take the required action. Percentage analysis is used to find out about percentage and to express about the research findings. This make easy to understand how IT helps to gain sustained competitive advantage
  • 10. 3.2 Data collection protocols and the sample Primary data collection protocols was questionnaire method. Two separate questionnaires were given to IT managers of the selected banks and the customers. Discussions, Interviews, Annual Reports, Circulars formed the secondary sources. Four Banks namely Commercial Bank, Hatton National Bank, Sampath Bank and Seylan Bank were selected for the sample. These are quoted retail Banks in Sri Lanka. This category was chosen on the basis of access to information and personal contacts with individuals within the organization. Researcher wants to identify how banks use Information Technology to attract, retain and satisfy customers. Through that banks can gain competitive advantage. Therefore 40 customers (Commercial Bank (A)-10,Hatton National Bank(B)-10, Sampath Bank(C)-10, Seylan Bank (D)-10)were selected. They also were the account holders in these banks. 3.3 Conceptualisation In recent years, a number of studies have suggested direct association between information technology and sustained competitive advantage. Information technology helps organization to gain competitive advantage and improve the organization performance. Organization that operate in the high competitive environment. Therefore organization identifies opportunity and using information technology, they can achieve their goals effectively.
  • 11. Figure 2: Conceptual Model Competitive advantage Threat of new entrants Industry rivals in competition Power of supplier Power of buyers Threat of substitutes Organizational performance Profitability IT related services New product success Changing relative market share ATM Tele-banking Credit cards Internet Banking Money transfer 3.4 Operationaliation Figure 3: Operationalisation Concept Variable Indicators Measurement 1.Threat of new entrants Cost of IT hardware Cost Questionnaire 1
  • 12. Development of IT Cost Questionnaire 1 Training cost to improve Cost Questionnaire 1 IT Local network Existence of the network Questionnaire 1 Existence of the network (Section II) Global network Questionnaire 1 (Section II) 2. Industry rivals in ATM Existence Questionnaire 1 competition Coverage (Section II) Money transfer Existence Questionnaire 1 Coverage (Section II) 3. Power of customer Internet Banking Existence Questionnaire 1 Coverage (Section II) Tele-banking Existence Questionnaire 1 Coverage (Section II) Credit card Existence Questionnaire 1 Coverage (Section II) 4. Threat of substitutes Tele-banking Existence Questionnaire 1 Coverage (Section II) Internet Banking Existence Questionnaire 1 Coverage (Section II) 5. Power of supplier Asset management system Existence Questionnaire 1 Coverage (Section II) 4 ANALYSIS AND OUTCOMES 4.1 Influences of Michael Porter’s Five-Force Model 4.1.1 Entry barriers Table 1: Entry barriers as a number System Bank A Bank B Bank C Bank D 1. Cost of IT 0.60 0.35 0.40 0.30
  • 13. (investment ) 2. Expenditure 0.18 0.12 0.20 0.50 on development of IT 3. Training cost 0.28 0.34 0.43 0.22 to improve IT skill 4. Local 0.95 0.67 0.90 0.56 network 5. Global 0.14 0.15 0.20 0.18 network Total 2.15 1.63 2.13 0.18 Average 0.43 0.33 0.43 0.20 Source: Survey Data The above table depicts barriers to entry which includes factors of cost of IT, expenditure on development of IT, training cost to improve IT skills, local network and global network. Bank A and C had reached the same level in creating entry barriers (0.43) but due to two different reasons. Bank A has allocated a high IT investment on budget and Bank C spent a substantial amount on training. Bank B and D hold an average of 0.33 and 0.20 respectively. Therefore, Banks A, B and C are strong enough to create a barrier to entry in the industry. Hence, bank D needs a huge capital investment on IT to create an entry barrier. 4.1.2 Industry Rivalry Table 2: Industry rivalry in relation to automated services System Bank A Bank B Bank C Bank D ATM 0.63 0.64 0.90 0.56 Money transfer 0.35 0.20 0.28 0.72 Total 0.98 0.84 1.18 1.28 Average 0.49 0.42 0.59 0.64 Source: Survey Data The table above shows the industry rivalry in terms of facilities as shared ATMs and Money transfer. Bank D (0.64) and C (0.59) are in rivalry position, which has led to head on attacks. Bank A, C, and D are aggressively competing in the industry in order to win
  • 14. competition. Bank B to become a rival has to develop money transfer facilities. Bank C has employed 100% (all the branches) ATM facility to all the customers throughout the island. Making it easier to reach and effective fulfilment of the need. 4.1.3 Bargaining power of customer Table 3: Automated services and the bargaining power System Bank A Bank B Bank C Bank D Internet Banking 0.40 0.125 0.48 0.20 Tele-banking 0.24 0.32 0.27 0.28 Credit card 0.24 0.54 0.72 0.35 services Total 0.88 0.985 1.47 0.83 Average 0.29 0.33 0.49 0.28 Source: Survey Data This study was also aimed at finding which bank possesses a high switching cost to reduce the bargaining power of customer. The above table shows bargaining power of customer in relation to Internet Banking, Tele-banking and Credit card. Bank C (0.49) and B (0.33) employ above IT related services to reduce bargaining power of customer. Bank D has to develop Internet Banking while bank A has to develop Tele banking and Credit card services to reduce bargaining power of the customer. 4.1.4 Threat of substitute Table 4: Threat of substitutes expressed in numbers System Bank A Bank B Bank C Bank D Tele-banking 0.24 0.32 0.27 0.28 Internet 0.40 0.125 0.48 0.20 Banking Total 0.64 0.445 0.75 0.48 Average 0.32 0.22 0.38 0.24 Source: Survey Data Since all the banks under review are quoted companies in the Colombo Stock Exchange there is a heavy threat of substitutes. Substitute products include Tele-banking and Internet Banking. Bank C created 0.38 threat and Bank A, 0.32. Bank D and Bank B have
  • 15. a threat of substitute 0.24 and 0.22 respectively. Both Bank B and Bank D have to divert their concern to Internet Banking in order to compete with other banks. Bank A and C are in a strong position rather than Bank B and D over substitute products. 4.1.5 Bargaining power of supplier Table 5: Bargaining power of supplier System Bank A Bank B Bank C Bank D Asset 0.20 0.12 0.16 0.14 Management system Source: Survey Data Bargaining power of supplier includes asset management system of the bank/s which helps to analyse the loan and deposit portfolios. The above table shows bank A has competitive edge on bargaining power of supplier (0.2) over other banks. Bank C, D and B posses a bargaining power of supplier rated 0.16, 0.15 and 0.12 respectively. It is found that Bank B, C and D have a very low impact on usage of IT over this. 4.2 Other findings - customer point of view on “IT” as a competitive tool 4.2.1 IT related services used by the customer Table 6: Statistics of IT related services used by customer Services Bank A Bank B Bank C Bank D Weighted Res. % Res. % Res. % Res. % value % ATM 9 28% 6 19% 10 31% 7 22% 32 37% Tele- 3 20% 2 13% 6 40% 4 27% 15 17% banking Internet 2 17% 2 16% 5 42% 3 25% 12 14% Banking Money 1 8% 2 15% 5 38% 5 39% 13 15% transfer Credit 4 27% 3 20% 4 27% 4 26% 15 17% card 87` 100% Source: Survey Data
  • 16. The above table shows most of the customers from bank C used all IT related services, when compared to other banks. In bank C 10, customers used ATM facilities, 6 customers used Tele banking, 5 customers used Internet Banking, 5 customers used Money transfer services and 4 customers used ATM facilities, but few customers used other IT related services. In Bank A and bank D most customer used ATM facilities than Internet Banking and money transfer services. Therefore, those Banks have to concern how to develop those IT related services to retain their customers and win the competition among Banks. Also 31% of customers from bank C used ATM facilities and 19% of customers from bank A used ATM facilities. 42% of customers from bank C and 25% of customers from bank D used Internet Banking. 40% of customers from bank C and 27% of customers from bank D used Tele Banking while 38% used Money transferring facility. 39% of customers from Bank used Money transfer services. All Banks’ average customers used Credit card for their transactions. Bank A 27% of customers used Credit card. 4.2.2 Quality factors preferred by customer Figure 4: Quality factors preferred by customer Quality factors preferred by customer Easy to handle 22% 21% Attractiveness Good image Quickness to 14% 10% transact Additional facilities 20% 13% Easy to reach Source: Survey Data Above graph explains that 22% of customers consider “easy to reach” as a quality factor in IT related services. The discussions revealed that bank/s have gained competitive advantage over IT related products/services when coupled with quality factors. 20% of customers expect quickness to transact and others follow. Additional facilities, good
  • 17. image and attractiveness are quality factors expect by 14%, 13% and 10% of customers respectively. 4.2.3 Reason for being a customer in the bank Table 11: Statistics related to preference banking Factors Bank A Bank B Bank C Bank D W.A % Res. % Res. % Res. % Res. % Speedy 8 27% 6 20% 9 30% 7 23% 30 21% service Technological 7 26% 5 19% 9 33% 6 22% 27 19% Facilities Wider spread/ 8 31% 4 15% 9 35% 5 19% 26 18% Coverage Better 4 20% 3 15% 7 35% 6 30% 20 14% environment Return on 5 23% 6 27% 4 18% 7 32% 22 15% investment Interest on 6 33% 3 17% 5 28% 4 22% 18 13% borrowing 143 100% Source: Survey Data This study also revealed the most preferred service from each bank by the customers. Responses of them formed evidence. Table shows most of the customers from bank C preferred the institution for speedy service, technological facilities and wider spread/coverage. Very few customers looked out for better environment, return on investment and interest on borrowing in all the banks. The responses also evidenced that, expectation of customers from each bank differ. Identifying and capitalising on these features have brought a competitive edge over the products/ services. 4.2.4 Changing the bank for last five years It was observed that 38% of customers from bank C have changed the bank for last 5 years while 42% of customers from bank D have not changed the bank for last 5 years. It disclosed that 57% of customers from bank C have changed due to poor service quality
  • 18. while 46% were lost to competitors. 57% of customers from bank A have changed due to high interest for borrowing. 4.3 Impact of IT in banking services The IT vision of all the banks is derived from their mission statements. It indicates that IT has an imminent place in these banking organizations. On the other hand also the management is longing to use IT in order to enhance the value of their services. Head of IT department is highly involved in corporate planning. In banks C and D 100% of branches are computerised while banks A and B stood at 98% and 97% respectively. Bank B and C have the widest coverage of ATM networks. Bank A provides ATM services through 95 branches and bank D provides this service through 68 branches that is 74%. This situation has created a gap between then the expectations and reality in the latter two banks. By using the strategies in the five forces model as discussed above the gap could be bridged. Investment (financial allocation) on IT forms a substantial amount in all the banks. Bank A has a 60% of IT investment on budget. All five banks have capacity to increase the IT budget in future. Banks spend a thumping amount sustain the competition over IT by way of introducing new products and enhancing the IT skills of their employees. Bank C has reported that 43% of its expenditure composed of training and development of IT skills. The research also proved that implementing IT in these banks leads to cost reduction. Bank C has reduced 30% of its cost and bank B experienced a 28% cost reduction due to IT. 5 SUMMARY AND CONCLUSION Today’s business organizations are information based. The major driving force is IT which increases the usage of information in an around organisations. It also leads to a greater shrinkage of time and distance effects and greater inter relatedness within an industry and organization. Business finds new ways to exploit information technology to be effective. In this endeavour they, in addition to the conventional methods, try to
  • 19. exploit all available communication technologies, computer-aided designs and sophisticated computing technologies, to gain competitive advantage. Banking is one of the industries, which involve both high information content of the product and high information intensity of process. The nature of the industry implies that it is highly competitive. Therefore, in order to cope up with the rising competition Banks can reflect on the use of IT as a competitive tool. Hence, this study deals with the research question whether Sri Lankan Banks use IT to gain competitive advantage. The study was carried out in four public quoted commercial Banks in Sri Lanka, namely Bank A, Bank B, Bank C and Bank D. The answer to the research question was given by research findings. Two banks namely A and C use IT to gain competitive advantage, while Bank B and D do not use IT efficiently to gain competitive advantage. Some branches are not equipped with ATM facilities and IT related services have to develop to compete with other banks. In bank A and C profitability is higher than bank B and D. According to the second objective of the research usage of IT increases the profitability. Further, IT related services such as Internet banking and Credit card have brought the competitive advantage to these banks as a whole. Almost all the banks provide better ATM services, Tele-banking and Money transfer to the customers. Hence they have to develop Internet banking and make it convenience to use the Credit card. The study too revealed that a Sri Lankan banking customer (potential) considers stability, reliability, accessibility/convenience, service factor, pricing, capable employees/staff, safety of money, and banking image when selecting their banking partner. They too expect different kind of quality in IT related services. This was evidenced by the choice of the bank, based on preferences. Competitor attractiveness and poor quality service had lead to a change in the customer base of certain banks. Therefore the strategic use of IT plays a vital role in retaining existing customers and attracting new customers. The information age is also changing the face of banking. In keeping with the customer demands and competitiveness, banks have no option but to keep up with the most modern
  • 20. changes in technology. All the banks in the sample compete with each other to provide better services, since a good customer service is vital in developing a loyal customer base. In order to stay ahead of their competitors these banks focused on differentiation rather than cost leadership. By differentiating their services they are able to lock in the customer, and thereby reduce bargaining power of customer. In relation to entry barriers, other than huge investment they are unable to prevent new entrants in the market. Hence, it can be concluded that the Sri Lankan Banks have to give further thought to gain competitive advantage through IT. REFERENCES Arif, A. A.,& Mammu, M. A. (1997). “Exploitation of information technology for competitive advantage”:An experience of ready-made Garment Industry, South Asian Journal of Management, Apr-Jun 31-41 Arun Kumar Jain, “competitive excellence, critical success factors”, Vikas publishing house pvt ltd Bradmore, D. (1996). “Competitive advantage: concepts & cases”. Prentice Hall of Australia Clemons, E. K., & Weber, B. W. (1996). Special section: “Strategic and competitive information system”. Journal of Management information system, Vol.13, No.2, ( 5-8) Earl, M. J. (1989). “Management Strategic for Information Technology”, Prentice Hall Inc. Fransisco. J Mota, William L.Fyerest , and Jay B. Barney, “Information technology and sustained competitive advantage”, A resource based analysis.
  • 21. Laudon, K.C., & Laudon, J.P (1998) “Management Information System: Organization and Technology”, (4th Edition).New Delhi; Prentice Hall Inc Marker. R.colgate.,(1998). “Create Sustainable Competitive Advantage through Marketing Information System Technologies”: a triangulation methodology within the Banking industry, Journal of Banking, Vol.12, Nov.p.12-15 Michael Porter, “the competitive advantage of nation”, the Macmillan press ltd. Ms. Ganga Nanayakara (2001), “the Global Village-never too far”. Bankers Journal, Vol. xxii, (Sep).pp16-18 Nunamaker, Jay & Briggs Robert “Journal of Management Information Systems” Vol. 13 No 3 Winter 1997 pp3-6 Peppard, J. (1993) “IT Strategy for Business”. British Library Cataloguing in Publication Data. Porter, M. E., Miller, V.E (1985). “How Information gives you competitive advantage”. Harward Business Review, July-August. 149-160 Ranga Warnakulasooriya. D.(2003), "Changing competitive advantage using wireless technology", Institute of Bankers, vol. xx no.03,(Oct)pp19-20 http://www.anu.edu.au/people/Roger.clerke/SOS/strartISTh.html. Roger clerke, (1994). “The path of development of Strategic Information system theory” Ver.14, (July) pp.19, Thomas. L.Power, William Hahn., (1996). “Critical Competitive Methods, Generic
  • 22. Srategies, and firm performance”. Journal of Banking, Vol.15.p.12-15 Appendix 1 Questionnaire 1 (IT managers) IT and Sustained Competitive Advantage This section contains questions regarding the background of the organization. You are required to mark “x” as an appropriate in the relevant box and please give brief answer to the other questions. 1. Name of the organization………………………. 2. Is your establishment is a public quoted local Bank? Yes No
  • 23. 3. Briefly explain the vision related to IT in your organization ………………………………………………………………………………………… ………………………………………………………………………………………… ………………………………………………………………………………………… 4. Is head of the department involved in Corporate Planning? Yes No 5. (1) How many branches are there in the country?..................................................... (2) Among those how many are computerized?........................................................ (3) How many branches provide Automated Teller Machine facilities?................... Please give a percentage rating 6. (a) (1) Capital investment on IT?..................................................................... (2) Is it sufficient? Yes No (3) Are there any plans to increase the allocation in the future? Yes No (4) Are adequate finances available when requested? Yes No
  • 24. (b) To what extend IT contribute to cost reduction ………………………….. (c) Expenditure on development of IT? ……………………………………….. (d) Training cost to improve IT skill?.................................................................. 7. (a) Is technology influence the skills of your work force? Yes No (b) Are you utilizing appropriate Technology? Yes No 8. Please specify following services provide by your Bank. (1)Internet Banking Yes No (2) Money Transfer Yes No (3)Automated Teller Machine Yes No (4) Credit cards Yes No (5)Tele-banking Yes No 9. Please specify new product/service introduced or will introduce in the future?
  • 25. …………………………………………………………………………………… …………………………………………………………………………………… …………………………………………………………………………………… …………………………………………………………………………………… …………………………………………………………………………………… …………… Section II This section is used to collect relevant data related to the development of IT facilitating services/systems and the coverage- number of branches related to some of the systems in Banking. This schedule has divided into two parts. Part 1 responding to development of IT facilitating services/systems, you are required to rank them from 0.00 (No development) 1.00 (Fully developed) depending on the level of development of IT. Part II, responding to the coverage of branches, you’re required to give the no. of branches where the system is in operation
  • 26. System/Service Development of IT Coverage Local network Global network Shared ATM Tele-banking Internet Banking Credit card Money transfer Asset Management System Appendix 2 Questionnaire 2 (relating to the customer)
  • 27. This section contains questions regarding the personal details of the customers. You are required to mark “x” as appropriate in the relevant box and please give brief answer to the other question. 1. The Bank/s you have account? …………………………………………… 2. If so, what type of account, do you have? Current account saving account Both 3. How did you come to know about the Banking service? TV advertisement Parent Posters/Banners Friends Radio News papers 4. How long have you been using this Banking service? 1-2 years 1-5 years 1-10 years more than 10 years
  • 28. 5. What purpose/s does your Bank account serve? Personal business All above 6. What are technologies related products/services that you currently use? Internet Banking Money transfer Credit card Tele-banking ATM 7. What are the quality factors that you expect from the technology related products/services? Easy to handle quick access to a/c Attractiveness additional facilities Good image easy to reach 8. If you prefer a particular Bank, reason behind your preferences?
  • 29. Speed of service Better environment Technological facilities Interest on borrowings Wider spread/coverage Return on investment 9. Have you changed your Bank account for the last 5 years? Yes No 10. What are the reasons for the above shift/change? Less interest for Investment less attraction High interest for Borrowings Poor customer care Competitor attraction poor service quality