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2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

Impact of Information Technology on Organizational Performance: A Comparative Quantitative Analysis of Pakistans Banking and Manufacturing Sectors.
Muhammad Shaukat, Assistant Professor, Institute Of Management Sciences, Bahauddin
Zakariya University Multan (Pakistan). Email: shoukatmalik@bzu.edu.pk

Prof. Dr. Muhammad Zafarullah, Vice-Chancellor, Bahauddin Zakariya University


Multan(Pakistan). Email: vc@bzu.edu.pk

Prof. Dr. Rana Abdul Wajid, Director, Centre for Mathematical and Statistical Sciences,
Lahore School of Economics, Lahore(Pakistan). Email: drrana@lahoreschool.edu.pk Key Words: Information Technology, Organizational Performance, IT in Banking and Manufacturing sectors

Abstract
One of the major developments which had profound impact on the economic growth pattern in the world in the new millennium has been the strides in the domain of Information Technology sector. The world has observed significant growth of applications in diverting areas of Information Technology. Information Technology has permeated nearly every aspect of modern business operations and communications. This technology really has drastically changed the working of todays organizations and is being used both by developed and developing countries for performance improvements. Similar to other developing countries, this technology is also being applied in all the organizations of Pakistan. Information Technology is also one of the most exciting areas of research that has been the focus of intense interest throughout the globe over the decades but little has been devoted to examining the impact of Information Technology on Pakistani organizations.

This study examines the impact of IT on organizational performance in quantitative terms of Pakistans manufacturing and banking sectors over period of 1994-2005. The primary data was collected through in-depth interviews, official documents and field surveys of 48 companies, 24 in manufacturing sector(12 local and 12 foreign) and 24 in banking
June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

sector(12 local and 12 foreign). The data was tested by applying different statistical and financial techniques. The results of the research have led to the conclusion that Information Technology has positive impact on the organizational performance of all the organizations but the banking sector performance outstrips the performance of manufacturing sector and local banking sector of Pakistan dominate the scene by implementing world class IT systems.

INTRODUCTION
Information Technology is a powerful force in todays global society. The advent of computers and Information Technology (IT) has been perhaps the single massive drive impacting organizations during past few decades. Information Technology or IT is revolutionizing all the living ways. No doubt, it has given a new meaning to the word Convenience. Information Technology has drastically changed the business landscapes and word IT has become the Catchword of the modern life today. Information Technology has become, within a very short time, one of the basic building blocks of modern industrial society. The effective use of IT is an essential element of competing in a fast-paced, knowledge based economy. Information Technology is the major contributor to the progress of the developed countries(Drucker, 1992; Lang,2002; Vasudevan,2003). The developing countries are increasingly deploying IT to solve their developmental problems by investing in it from their own sources as well as by borrowing from different institutions(Odedra & Kluzer, 1998). Lending for IT by the World Bank has also been quite pervasive and growing at six times growth rate of total banks lending. A study has shown that the significant IT components were present in over 90% of all world banks lending in developing countries(Harris & Davision, 1999). It is also estimated that total annual worldwide expenditure on Information Technology (IT) probably exceeds 1.5 trillion US

June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

dollars per year and is growing at about 10% compounded annually (Anandarjan et al., 2002). Information Technology also creates a serious dilemma for management today. IT innovations have the potential for changing the competitive game for any organization. On the other hand, the size of IT investments put increasing pressure on managers to asses its business value. One key to this dilemma is to improve the ability to measure and track the impact of IT on productivity. Alongside, the seemingly inexorable rise in IT investment during the last 20 years, there have been considerable uncertainty and concern about the productivity and efficiency impact of IT being experienced in work organization. However, in quest of improving efficiency and effectiveness the companies are making heavy investments in Information Technology. These enduring magnitudes of investment in Information Technology so has drawn attention of many researchers, managers and policy makers to the impacts of IT on growth and productivity. The expectation was that increased investment in IT would naturally lead to increase performance of organization. But despite the massive investments in IT both in the developed and developing economies, the impact of IT on productivity and business performance continued to be questioned (Wilcock, et. al, 1998). Despite hundreds of studies carried out, scholars remained deeply divided into two groups which can be identified as Productivity Paradox-IT has no impacts on productivity(Turner, 1985, Loveman, 1988,1994; Roach, 1988; Mitra & Cyaya, 1996; Strassman(1997); Dasgupta & Sarkis(1999) etc.), and Productivity Payoff-IT does improve productivity (Bender, 1986, Mody & Dahlman, 1992); Raheim & Pennings, 1987; Harris & Katz, 1991, Brynjolfsson, 1993, 1996, Brynjolfsson, & Hitt, 1994, 1997, 1998; Attewel, 1991; Karemer, et. al, 1994; Dewan & Kraemer, 1998, Quinn, et. al, 1994 ; Ng, 1996, Weill, 1992, Mehmood & Mann, 1993).

The goal of every information systems, based in any organization is to improve performance on the job and this performance efficiency is only achieved when IT is accepted and used warmly by the concern employees in organizations (Venkatesh et al., 2003). In their quest for development, many developing countries put great hope in use of IT. Yet, the challenges of IT diffusion in these countries are by no means identical to the
June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

ones in the developed countries. The challenges faced by developing countries in harnessing the full potential of IT are not really very different from those of that confronted by the developed countries(Khan, 2003). Information Technology now is the most preferred choice of all developing and developed countries to upgrade their economies and become competitive in the global market place. The IT based economies have streamlined the most complex economies of the world and enhanced the productivity to the level where an economy such as US has wriggled out of the entire trillion plus dollars national deficit and turned into a surplus in recent years. The world economy now has moved from lowvalue basic industries to a fast paced high-value information based economy.

Motivation for this Study


The impetus for this research came from the main reason that in modern organizations Information Technology is a key to competitiveness and economic growth. It has no doubt the greatest influence on the global economy. Like other countries Pakistan has also accepted this challenge of 21st century by making efforts in the development of Information Technology. A decade ago IT had very little introduction in the country, but very soon with the efforts both on private and government fronts the concept of IT has become very popular with all Pakistani organizations. Pakistani manufacturing and banking industries are the major users of IT products. The central thesis of the present study is to seek the impact, which Information Technology has on organizational performance of Pakistani companies working in above mentioned sectors.

Literature Review
Definition of the concept of Information Technology
Information Technology has been defined in various ways by different authors. Over the years, IT has been conceptualized and measured differently by different researchers. The majority of the authors, however, parallel Information Technology with computer systems.
June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

Frenzel(1999) for example defines IT as Information Technology is the term that describes the organizations computing and communications, infrastructure, including computer systems, telecommunication networks, and multimedia (combined audio, text, and video) hardware and software. Shelly et. al(2005) narrate that IT includes hardware, software, databases, networks, and other related components which are used to build information systems Many other researchers also have come up with the same idea and say that IT is the technology that supports activities involving the creations, storage, manipulation and communication of information together with their related methods and management applications (Martin et al., 1999; Gupta,2000; Kendall & Kendall ,2000; Chan, 2000; Poku & Vlosky, 2002). However, William & Sawyar, 2005 define Information Technology as a general term that describes any technology that help to produce, manipulate, process, store, communicate, and/or disseminate information. This definition may be regarded as the comprehensive one, as it covers all aspects discussed by different researchers and includes all the components and processes needed to carry out information processing work in the organization. So it can be said that that IT concept came from a merging of computer with telecommunications technologies, when computer and communications technologies are combined, the result is Information Technology or infotech.

Information Technology Developments In Pakistan


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. In Pakistan, realizing the global revolution in Information Technology, the government has liberalized its policies with regards to hardware & software imports since 1985. The custom duties on electronic goods were also reduced drastically, but the real quantum jump was experienced in early 90s, which can be termed as IT revolution in Pakistan and satellite communication technology was introduced. In 1991, 90% telephone lines were converted to digital. In 1995, Internet Service Providers (ISPs) started providing Internet facility to Internet users

June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

and now there are more than 132 ISPs in operation all over the country providing internet facility to more than 3,000,000 users1. It is all in 2000s, that the government started giving a lot of emphasis to IT sector. New IT educational institutes are opened & IT professionals are hired to impart IT training in universities. Nationwide IT seminars, forums, exhibitions and competitions are being arranged to create IT awareness among the people. Computer as a subject have been introduced in schools & colleges. Cyber Cafes are being opened to create awareness for Internet use. Telephone network has been enhanced and in rural areas, telecommunication facilities are provided through small exchanges and PCOs. By doing so links between Pakistan & other countries have been improved significantly (Imam 2002). Information Technology is now also being used in all government organizations. Now the Government of Pakistan is taking all steps to make Pakistan an IT super power by adopting IT as a national program so as to enable personal and national growth. The countrys current IT Policy and Action Plan intends to involve all walks of life, e.g., industry and commerce, banking and insurance, finance, revenue, communication, media, human resource development, defense etc.(Rehman, 2005). The computerization in the country which was initially monitored by the Ministry of Science & Technology(MOST), now is being managed by a separate ministry of Information Technology since November 2002. This ministry is maintaining firmness and viscosity with the policy and achievements made in the IT & Telecommunications sectors since its inceptions and to cope with modern challenges and meeting requirements of the IT and Tele-communications, the policy is regularly updated. Many other departments/ institutions like Electronic Government Directorate, Pakistan Computer Bureau, Pakistan Software Export Board, Pakistan Telecommunication Authority, Computer Society of Pakistan, Pakistan Software Houses Association (PASHA)2 etc. are working side by side the Ministry of Information Technology to help forward IT in the country. To provide
1 2

www.moitt.gov.pk

PASHA is a representative body of software developer of Pakistan. It was found in late 1992 by 9 software hoses and now have about 350 members national wide: www.moitt.gov.pk June 22-24, 2008 6 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

protection and enhance the confidence of users, providers and facilitators of information services, legislation based on the recommendation of the working group comprising IT and legal experts have been framed. Action in the area of digital signature act intellectual property and copy right act and the consumer protection act has been started.(Kazmi, 2005). According to some estimates, in Pakistan presently there are around 2,100 mainframe and minicomputers in the country with nearly half of them being in the government sector. Liberal import policy and reduction/removal of duties has 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. The Federal Government of Pakistan has laid great emphasis on expedition towards the intensity of Information Technology in a variety of fields. (Ghauri, 2003; Pasha, 2005). To conclude all efforts of the government it can be said that the Government of Pakistan now is giving all-out support and push to IT sector. Millions of dollars are being invested by the government in IT, and majority being spent on human resource development and enabling infrastructure provision. The Government of Pakistan is leading the technology revolution in the country in various projects aimed at improving infrastructure, human resource development and integrating IT in the public and private sector (Kazmi, 2000). Information Technology And Pakistans Banking Industry. Financial sector appears to be a clear leader in the growth of IT. It was among the first to incorporate electronic data processing in its operations, through check handling, bookkeeping, credit analysis and ATMs. Mayer(1987) while narrating the history of computer usage in banking demonstrates 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. Initially, computers were used to process check transactions through magnetic ink character recognition. With the introduction of first automated clearing house in the early 1970s electronic funds transfer (EFT) was made possible, and then ATM was introduced.
June 22-24, 2008 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

Automated Teller Machine (ATM)3 is one of the most significant technological investments made by the commercial banks. ATMs introduced the power of computer technology to the general public and made banking convenient for consumers. Today, ATMs deliver banking service 24 hours a day, 7 days a week to more than 22 millions peoples only in USA. The banks increasingly have turned toward ATM and other computer technology like prepaid cards, loyalty cards, debit cards and even chip cards, to reduce the high costs associated with maintaining traditional brick and mortar branches staffed by tellers Koepp(2000). Franke(1987); Martini(1999). Now the banks are using Information Technology in back-office (check and accounts) processing, mortgage and loan application processing, and the electronic funds transfer to more strategic innovations such as automated teller machines and new kinds of securities (Nsouli,2002). The financial sector in Pakistan can be grouped into banking and non-banking financial institutions (NBFIs). Banking institutions include large public sector scheduled banks, private sector banks and foreign banks, while NBFIs include development finance Institutions (DFIs), private sector investment banks, leasing companies and modarbas. The banking industry in Pakistan has seen great transition during fifty-nine years of his history, especially since early 1970s. The banking nationalization in 1974 and then privatization and liberalization in early 1990, are termed as major restructuring years of the entire banking industry of Pakistan. At the time of inception of Pakistan in 1947, only few bank branches existed in the country, which were concentrated mainly in the urban areas. Moreover, Pakistan was without a central bank of its own till June 30, 1948. However, by early 1990s the banking sector had spread to every nick and corner of the country. The market for banks is diverse in Pakistan comprising Nationalized Banks, Private Banks and Foreign Banks. In 1993 there were 33 commercial banks in Pakistan 14 being local & 19 foreign. By the end of 2001 due to government liberalization policy to setup a private bank, the number has increased to 43, 24 being local & 19 as foreign. But by the end of 2005, with some mergers there were 38 commercial banks 14 being foreign and 24 being local. Total number of scheduled banks branches stood at 7,075 as on 30 th September,
3

Don Wetzel developed ATM in 1973 and it was first installed at Chemical Bank in New York (Shelly et. al(2004) pp5.39. June 22-24, 2008 8 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

2005. There is a phenomenal progress in banking sector of Pakistan. It recorded an increase of 99% growth in profit in only one year i.e 20054. NBP, HBL, MCB, ABL,UBL are considered five large banks and are very dominant in the banking industry , in term of total number of 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 19925. 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 regulate their banking work. Since that time there is a massive investment in IT in banking sector (Akhtar, 2006). This is bore out by the fact that during fiscal year 2003-2004, over US$ 200 millions was invested by the financial services sector into Information Technology products and services6. Shafiq(2002) says that not only this but also the banking sector has dramatically increased its dependence on use of IT, and it is evident by the growth in the number of branches that are connected online. In Pakistan almost all national and multinational banks are using Information Technology to increase their performance. Most of the Pakistani banks (local and foreign), have launched their web sites and have uploaded many things on web including accounts opening forms and loan applications. Likewise, the number of Automated Teller Machines(ATMs) and the use of automated cheque clearing and other back end systems within the banking community have increased7. There have been great advances in Pakistan banking technology in the past several years. The most recent automated banking systems like Misys, Sibel, and Fidility etc are being installed in many of the Pakistani banks. Kazmi(2004) points out that most of the banks operating in Pakistan however, have been making huge investments in three key areas namely 1) expansion of the branch network 2) up gradation of the existing infrastructure 3) adaptation of the new technologies with their ultimate objective is to offer a complete
4

The daily Dawn: Banks profit grew 99pc in 2005, Tuesday March 21, 2006. pp9. Mahmood Javed (2006) Another productive year for Banks Money Plus July 17,2006. 5 Pakistan banking infrastructure statistic: State Bank of Pakistans report 30-09-2005.
6 7

Status Of IT Industry Of Pakistan, The Dawn, 28th February, 2005.

Approximately 2174 ATMs have been installed by different banks till May 2007 in different cities of Pakistan (The Dawn, June 22, 2007). Out of Total 7674 Branches, 4091 (53%) are Online. Jang 31-5-2007 June 22-24, 2008 9 Oxford, UK

2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

electronic banking facility. Table 1 presents a real picture of E-Banking infrastructure statistic of Pakistan till September 2005. Ahmed(2003) posits that the huge investments by the commercial banks in technology has ushered a new era of convenience and improved quality of services in Pakistan. The banks are offering Internet and mobile banking but it has not made major impacts yet. In the end to mention another big achievement in payment area is RTGS setup by State Banks of Pakistan for interbank settlement.

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2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

Table 1

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2008 Oxford Business &Economics Conference Program

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Information Technology Industry.

And Pakistans Manufacturing

Automation in manufacturing organizations goes back to 1900. Around the year 1900, factory mechanization facilitated mass production to meet the consumers demands for improve products. In the year 1930, transfer lines and fixed automation were created to facilitate mass production. This resulted in the development of programmable automation. By the year 1950, numerical control (NC) was developed as an innovative approach to programmable automation. With the development of commercially available computer technology, the application of computer in manufacturing started to emerge by producing a variety of new technologies. By the year 1955, the introduction of computer aided design(CAD) and development of NC resulted which lead to the evolution of system like computerized numerically controlled machine tolls (CNC). By the year 1970, development in CAD applications and Computer Aided Manufacturing (CAM) based systems, Computer Aided Engineering(CAE),Material Resource Planning(MRP), Flexible Manufacturing Systems (FMS),which are collectively named as AMTs-Advanced Manufacturing Technologies was made(Negalingam and Lin, 1999). AMT provided flexibility as well as data driven computer integration for a manufacturing organization, in which the manufacturing technology utilized is intelligent enough to urge forward the activities with less human interventions. Industrial robots, automated guided vehicles, and automated storage and retrival systems are also introduced. These applications can be connected via Local Area Networks(LAN) to from computer Integrated Manufacturing(CIM) and externally, across organizations and space, via Electronic Documented Interchange (EDI) (Sohal, 1999). The technology advancement in the world over is so rapid and wide spread that isolates manufacturing and technology from each other is merely an impossible proposition. Information Technology is becoming critical to many manufacturing organizations that want to be a world-class manufacturer as IT often provides a manufacturing based advantage. Information Technology can assist manufacturing firms in developing their strategic roles. In todays competitive global market, for the survival of any industry, manufacturing companies need to be pliable, adaptive, responsive to change, proactive and
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2008 Oxford Business &Economics Conference Program

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be able to produce a variety of products in short time at a lower cost (Ho, 1996). Hence, manufacturing companies are compelled to seek advanced technologies by integrating manufacturing facilities and systems in an enterprise through computers, its peripherals and communication network to transform island of enabling technologies in to a highly interconnected manufacturing systems. Today, the capability of producing high quality products according to diverse customer requirements with short delivery times has become the characteristic of order-qualifiers for manufacturing industries. Furthermore, non price factors, such as quality, product design, innovation and delivery services are the primary determinants of product success in todays global arena(Shaw, 2000). Implementing integrated advanced technologies is an effective approach towards solving the problems of decreased productivity, labor cost and consequent rise in unit costs, which are continually plaguing present day manufacturing manager. Implementing advanced manufacturing technologies (AMTs) provides opportunities to achieve competitive advantage in an intermediate-to long-term time frame (Sohal, 1999). The Internet based distributed systems motivated the industries to utilize IT in all areas. Advances in software technologies have been transforming the world of integration into compatibility systems and devices by establishing an open connectivity standards, agreed by the manufacturers, which will provide plug-and-play communication and interoperability between field devices, control systems, and enterprise wide business applications(Kumar, et. al, 2004). Pakistan industrial sector remains a relatively small part of the total economy. Pakistans manufacturing sector has grown rapidly but remains inefficient and lacks diversification. In practice, Pakistans industrialization process has largely been governed by trade and tariff policies which are driven by revenue and/or balance of payments considerations rather than by a coherent industrial policy framework (Kemal, 1999). Overall manufacturing is growing at a much faster pace than agriculture and services and if this pace is sustained, its share in GDP is likely to rise further in the medium term 8. Various factor including accommodative monetary policy, financial discipline, consistency and continuity in policies, strengthening of domestic demand is continuously improving to improve contribution of manufacturing sector. In Pakistan both large-scale, multinationals, local and
8

Pakistan Federal Bureau Of Statistics, 2004.

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2008 Oxford Business &Economics Conference Program

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small scale domestic and international companies are operating which are producing goods of almost all kind (Saeed, 2003). Revolutions beget openings of one kind or the other. The IT revolution would semblance to have opened a beneficial window of opportunity for the Pakistani manufacturing organizations. 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. Within the industrial sector, the use of Enterprise Resource Planning software packages such as SAP and Oracle have become commonplace.9(Rizvi, 2005; Shahid, 2005; Mujahid, 2003).

Organizational Performance
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 organizations work process and activities. 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 organizations reputation. When the performance of the organization is assessed, the past management decisions that shaped investments, operations and financing are measured to know weather all resources were used effectively, weather the profitability of the business met or even exceeded expectations, and weather financing choice were made prudently. The most frequently used organizational performance measures include organization efficiency(productivity), organizational effectiveness and industry ranking (Wetherbe,1999; Turban, et al, 1999 & 2001). As this paper focuses on measurement of efficiency and effectiveness part of organizational performance, therefore, these concepts are elaborated in detail. In the academic literature efficiency is defined by many ways, Witzel(1998) for example looks at the origin of the term and finds that it has two meanings: technical efficiency or ensuring that systems and process work to their optimal level, and total efficiency, or ensuring that the organization as a whole is fit to meets its goals. Edwards(2001) says that Efficiency is minimum utilization of resources and getting maximum output.
9

Report from Federal Ministry Of Industries, 2004.

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2008 Oxford Business &Economics Conference Program

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Druker(2002) defines efficiency as It is doing job successfully without wasting time or energy. While defining effectiveness Hosmer(1982) says that Effectiveness means how well the job gets done. McClenahen (2000) defines effectiveness in a way that It is extent to which an organization realizes its goal. Oz (2002) defines effectiveness, as It is the degree to which a goal is achieved. According to Robbins & Coulter(2002) Effectiveness is doing the right things to achieve organization goal.

Measuring Impact Of Information Organizational Performance.

Technology

On

As Walrad & Moss(1993) state that efficiency and effectiveness do not means the same thing. In fact, they are often natural enemies. Often one can have one, or the other, but not both (Unless one is lucky or one want to spend a lot of money). Being efficient means that one spends less time on something, one spends less money on something or one spends less efforts (or number of workers) on something. Being effective means that one does his job well. In other words, the output (finished product) is of high quality. It is a rare and delightful occasion where a solution to a problem is both efficient and effectiveness; one usually has to decide which he prefers, because one usually cannot have both. Maggiolini(1999) rightly assessed that efficiency and effectiveness are entirely unrelated, so as their measurement.

In an IT context when we measure the effectiveness, we basically measuring the capacity of the outputs of information systems or of an IT application to fulfill the requirements of the company and to achieve its goals, making this company more competitive. In the same IT context the efficiency is the measurement that how cheaply can you get things done, and are the people to whom you provide IT services (the stakeholders) happy with the levels of service being delivered? and does it reduced the operational expenses?. Various studies have been undertaken to measure the impact of IT on management performance (efficiency & effectiveness) of business organizations using different performance indicators which according to Dyson(2001) are considered key factors. These variables capture all activity levels and performance measures and common to all units and
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cover the full range of resources used. These variables include income, customer satisfaction, supplier/customer links, company image, job interest of employees, stake holders confidence, interoffice links. Researchers like Huber(1996), Parthasamthy and Sethi(1993), Kelly(1994), Earls(1996), Rumizen(1998), ODell(1999) etc. have investigated the impact of IT on incomes/profits of the companies and found positive impact. Whereas, Farkline(1997), Marton and Chester(1997), Olalla & Fassas(2000), Schmidtel et. al(2001), Zee(2004) etc. have seen the increase/decrease in above qualitative factors after implementation of IT. They have concluded that IT has ultimately increased company image, job interest of employees, stake holders confidence, interoffice link etc. This study measures the organizational performance in respect of increase/decrease in income/profits and no of employees of Pakistani companies operating in banking and manufacturing sectors with relation to IT implementation.

Research Propositions
The Sample
There are two population groups for this research. One is the banking sector local and multinational and the other is large manufacturing organizations again both local and multinationals, which are making use of Information Technology. The reasons to select the above-mentioned sectors are that; 1) the banking sector of Pakistan is the most organized sector of the service industry and highly IT user 2) this sector has made much more investments in IT than any other sectors to achieve high performance 3) IT has met greater introduction in banking sectors for performance improvements since 1992 because of throat cut competition after establishment of many new banks in the private sector and privatization of many nationalized banks. The second sector of study i.e. manufacturing is the next best user of Information Technology. A large number of local and foreign manufacturing companies working in Pakistan are using IT for their business processes since long. Many companies in both the sectors have state-of-the-art technologies for improving their performance. The management of these organizations has also made numerous investments in I.T with the hope to increase their efficiency.
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In the sample from the above sectors 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 Annexure II. There are about 40 commercial banks operating in Pakistan. 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 2000 large-scale manufacturing units are operating in Pakistan. Therefore, in the sample, from the manufacturing sector, a total of 24 big organizations were randomly included. 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. The companies selected are using latest Information Technology and have well established IT set up.

Data Collection
The participants in the study were categorized as follows; the senior managers of finance, human resources, marketing and IT departments of the companies in sample. The data was collected from in-depth interviews using a structured close-ended questionnaire, and from official documents, detailing different aspects pertaining to the study. During the process of data collection, follow-up letters and telephone calls were also made to the respective company.

Data Limitations
In this research the research problem has been analyzed for the last decade i.e. from 1994 to 2004, because of the reasons that many companies operating in Pakistan were either not using IT before 1994 or IT had very little introduction and computers were being used merely as a word processing tools. So it was difficult to measure any of significant IT impact on management performance before above period. Most of the companies initially declined to provide any financial(IT expenses and Income) data citing confidentiality and busy schedules as reasons. However, by help of SBP and SECP, the researchers managed to collect some data in one year period from these companies. Therefore, Income & IT
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expense analysis for test of hypothesis is limited to those companies and for those years for which the data is received. So for analyses of Income Vs IT expense, the companies are divided into two groups as given in Table 2 & 3 below. The response rate for data was
Table 2: Group 1: (Companies for which data was available for year 1990 to 2004

42% for the year 1990-2004 and 67% for the year 1999-2004.

Data Analysis A. Foreign Banks

Methods:

B. Local Banks

1. ABN Amro 1. Allied Bank Ltd. The statistical software packages named SPSSBank Ofand Minitab 14.0 have been used for 12.0 Punjab 2. Bank Of Tokyo 2. 3. Deutsche Bank 3. First statistical techniques such as linear analysis. According to the problem/requirement,Women Bank Ltd. 4. HSBC Bank 4. Muslim Commercial Bank Ltd. regression AZ-Zurich t-test, One Way ANOVA National Bankanalysis have been applied. The 5. HBL model, 5. and ratio Ltd. C. Foreign Manufacturing conclusionPakistan Ltd. 1. I.C.I at the end. 3. 4. 5.

proceeding discussion presents the analyses/results of the hypothesis of the study with The research hypothesis stated at the beginning, is then taken as 1. Atlas Honda Ltd.
3. 4. 5. Lakson Tobacco Service Industries Packages Ltd D. Local Manufacturing 2. Pakistan Tobacco Ltd. 2. D.G. Cement alternative hypothesis in the statement of statistical hypotheses. Suzuki Pakistan Ltd. Simens Pakistan Ltd. Uni Lever Pakistan Ltd.

Table 3: Group 2: In this group three more companies in each sector of group 1 are added and the data is available for the years 1999-2004. A. Foreign Banks B. Local Banks
1. 2. 3. 4. 5. 6. 7. 8. C. 1. 2. 3. ABN Amro Bank Of Tokyo Deutsche Bank HSBC Bank Ltd. HBL AZ-Zurich Citi Bank Standard Chartered Bank Oman Bank Ltd. Foreign Manufacturing I.C.I Pakistan Ltd. Pakistan Tobacco Ltd. Suzuki Pakistan Ltd 1. 2. 3. 4. 5. 6. 7. 8. D. 1. 2. 3. Allied Bank Ltd. Bank Of Punjab First Women Bank Ltd. Muslim Commercial Bank Ltd. National Bank Ltd. Askari Bank Ltd. Bank Al-Habib Ltd. Metropolitan Bank Ltd. Local Manufacturing Atlas Honda Ltd. D.G. Cement Lakson Tobacco

4. 5. 6. 7. 8.

Simens Pakistan Ltd. Uni Lever Pakistan Ltd. Bata Pakistan Limited L.G Pakistan Limited Reckitt Benkiser Limited

4. 5. 6. 7. 8.

Service Industries Packages Ltd General Tyre Ltd Indus Mtors Ltd Honda Atlas Ltd

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Research Hypothesis This section examines the performance of both the sectors of economy i.e banking and manufacturing in term of increase/decrease in net income and no of employees. Increase/decrease in incomes has been observed for all companies in both the sectors and for each conditions two different research hypotheses have been tested as under; Implementation of IT has impact on the performance of an organization. This can be translated in form of statistical hypotheses as: H0: IT has no impacts on performance of the organizations. H1: IT has impacts on performance of the organizations. In order to test the above hypotheses, the performance of an organization has been measured by measuring: (a) Increase/decrease in net income, after implementation of IT. (b) Increase/decrease in the proportion of IT employees as the IT is implemented.
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Time series data was available for these variables. Simple linear regression model was fitted taking IT expenses and time as independent and income as dependant variables. Summary of regression results are presented in Tables 4(a,b,c,d) to 5(a,b,c,d) and 6.

Results And Discussions


In the discussion below we examine the impact of IT on organizational performance by performing the quantitative analysis of net income, IT expenses, total and IT employees. In interpretation, results of each company are discussed separately then comparison has been made between the Local & Foreign Banks, Local and Foreign Manufacturing Companies, Banking and Manufacturing Sectors. The discussion is also made on all the companies overall.

i) Banking Sector.
a) Foreign Banks: The regression analysis shows that IT has no impact on the

incomes of the Bank of Tokyo, Deutsche Bank and HSBC bank as p-values or marginal significance levels for these banks are above 0.05. IT has positive impact on the incomes of ABN Amro and Habib Bank AG Zurich as p-values or marginal significance levels for both these banks are far below 0.05. All regression coefficients are positive showing that with the increase in expenditure on IT, the incomes of these banks have substantially increased. Analysis is also made for all foreign banks as a whole for group 1 and group 2(Tabel 2 & 3). For both groups, it was found that IT has significant positive impact on income of all foreign banks operating in Pakistan (pvalue < 0.05).
Table 4(a)
S/No 1 2 3 4 5 6 7 8 9

Regression Results Summary ( = 0.05) For Banking Sector Year 1990-2004


Bank Name All Banks : n=10 All Foreign Banks: n=5 All Local Banks: n=5 ABN Amro HBL AG Zurich Bank of Punjab First Women Bank Muslim Commercial Bank National Bank of Pakistan Results coefficient 7.179 4.458 7.726 7.487 12.919 3.214 8.264 10.791 7.316 t-Statistics 8.661 10.573 5.929 15.187 9.829 2.574 3.673 8.871 2.510 p-value .000 .000 .000 .000 .000 .023 .003 .000 .026

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Table 4(b)
S/No 1 2 3 4 5 6 7

Regression Results Summary ( = 0.05) For Manufacturing Sector Year 1990-2004


Company Name All Companies: n=20 All Local Manufacturing: n=5 Atlas Honda Lakson Tobacco Suzuki P.T.C Siemens Results coefficient 4.357 4.148 12.157 12.509 61.397 1.956 1.624 t-Statistics 4.357 3.071 2.686 7.885 4.898 2.182 5.927 p-value .000 .003 .019 .000 .000 .048 .000

Table 4(c)
S/No 1 2 3 4

Regression Results Summary ( = 0.05) For All Companies Year 1999-2004


Company Name All Companies: n=20 All Banking Sector: n=10 All Local Banks: n=5 All Foreign Banks n=5 Results coefficient 0.02.798 0.04.57 0.03923 0.155 t-Statistics 2.685 6.159 4.432 9.453 p-value .008 .000 .000 .000

Table 4(d)
S/No 1 2 3 4 5

Regression Results Summary ( = 0.05) For All Companies Year 1999-2004


Company Name All Companies n=32 All Banking Sector n=16 All Local Banks n=8 All Foreign Banks n=8 All Local Manufacturing n=8 Results coefficient 0.03496 0.04879 0.04024 0.09181 0.03068 t-Statistics 4.258 7.903 4.953 10.714 2.680 p-value .000 .000 .000 .000 .010

Table 5(a)
S/N o 5 6 7 9

Regression Results Summary ( = 0.05) For Banking Sector Year 1990-2004


Bank Name Results coefficient 15.788 -.466 11.273 .288 t-Statistics 2.128 -.172 1.405 .047 p-value .053 .866 .184 .963

Bank of Tokyo Deutsche Bank HSBC Allied Bank Limited

Table 5(b)
S/N o 1 2 3 4 5 6 7

Regression Results Summary ( = 0.05) For Manufacturing Sector Year 1990-2004


Company Name Results coefficient .118 -.275 1.171 70.706 -.701 .496 -.960 t-Statistics .285 -.423 .374 1.869 -.112 .226 -.761 p-value .776 .674 .715 .084 .913 .824 .460

All Manufacturing Companies: n=10 All Foreign Manufacturing: n=5 D.G. Cement Packages Service I.C.I Pakistan Uniliver Pakistan

Table 5(c)

Regression Results Summary ( = 0.05) For all Companies Year 1999-2004

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S/No 1 2 3

Company Name All Manufacturing Sector: n=5 All Local Manufacturing: n=5 All Foreign Manufacturing n=5

Results coefficient -0.0153 0.01588 -0.03544 t-Statistics -.648 1.165 -1.210 p-value .519 .254 .236

Table 5(d)
S/No 1 2

Regression Result s Summary ( = 0.05) For all Companies Year 1999-2004


Company Name Results coefficient -0.005.53 0.001141 t-Statistics -.203 .073 p-value .840 .942

All Foreign Manufacturing n=8 All Manufacturing n=16

Table 6
S/No

Regression Results Summary For Total and IT Employees (n=20) Year 1990-2004
Organizations Results t-Statistics P-value .000 .000 .220 .000 .000 .000 .000

1 All Companies 20.886 2 All Banks 13.576 3 All Foreign Banks -1.288 4 All Local Banks 13.953 5 All Manufacturing 16.565 6 All Local Manufacturing 12.428 7 All Foreign Manufacturing 17.500 Years: Independent variable IT Employees %age to Total Employees: Dependent variable

As depicted in Annexure II, total no of employees in foreign banks have been increased continuously from the year 1990 to 2004, despite of the facts that IT has been applied in all operations of the banks. The IT has not reduced the number of employees as anticipated by some circles due the reasons that most of the banks in this sector have introduced new products or services during this period, so the work load has increased therefore staff strength has also increased. It has also been observed that there are floating trends in the strength of IT employees. As Annexure II indicates that IT employees have increased for years 1990-1993, decreased from 1994 to 1997 but again increased from 1998 onwards and that increase is due to increase in IT activities because of raised volume of transactions, introduction of new products/services and increasing competition with the local banks in offering online/ computerized services. The net income for these banks for the years 1990-2004 is PKR 11,429,932,000 and IT expenses are PKR 1,716,997,260
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which comes to 15.02% of net income but net income for these banks for the years 1999-2004 comes to PKR 18,616,763,000 and IT expense are PKR 2,460,082,000, which are 13.21% of net income. b. Local Banks: It is revealed from regression analysis that IT has positive impact on the income of most of the local banks i.e. Bank of Punjab, First Woman Bank, Muslim Commercial Bank and National Bank of Pakistan (p-vale or marginal significance level is far below 0.05). But IT has no impact on income of one bank, i.e Allied Bank (p-value > 0.05). Overall it is also found that IT has positive impact on income of all the local banks for group 1 and 2 as for both groups (p-value <0.05).All regression coefficients are also positive which shows that with the increase in expenditure on IT, the incomes of these banks have increased significantly. As shown in Annexure II, there has been decrease in total no of employees of local banks. It is not because of IT but it is due to restructuring and privatization of most of local banks. For right sizing purpose many employees were laid off by offering golden hand shakes schemes. Contrary, as also presented in Annexure II, there has been gradual increase in the IT employees, due to increase in workload for up gradation, computerization/making online of many branches as per industry or customer need. Moreover, net income for these banks for the years 1990-2004 is PKR 28,040,686,000 and IT expense are 4,185,681,800, with a ratio of 14.93%, whereas net income for these banks for the years 1999-2004 is PKR 28,710,716, 000 and IT expenses are 4,479,494,500 with an increased ratio of 15.60%.

c. All Banks : Turning to the overall performance of all the banks for group 1 & 2, it is observed that IT has positive impact on the income of all these banks (pvalues< 0.05). A positive regression coefficient supplements our results that

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increase in expenditure on IT significantly increases the incomes of these banks. To further examine the performance, trend analysis for IT spending and net income is carried out. It is noted that there is increase in income with proportional increase in IT expenditure of all banks. Detailing it, the net income for all the banks for the years 1990-2004 is PKR 39,470,618,000, IT expenses are 5,902,679,060, which are 14.95% of net income. The net income for all the banks for the years 1999-2004 for group 2 is PKR 47,327,479,000 and IT expenses are 6,939,576,500, which are 14.66% of net income. While the net income for all foreign banks for the year 1999-2004 is PKR 7,44,175,000 and IT expenses are 1,050,855,000 which are 14.12% of the net income for the same period, but these expenses are 61.20% of total IT expenditure out of the year 1990-2004. That means that the companies have been spending large amounts during the last six years in their IT operations. The same case is for all local banks i.e. the net income for all local banks for the year 1999-2004 is PKR 18,773,824,000 and IT expenses are 3,454,532,500 which are 18.40% of the net income for the same period but these are 82.53% of total IT expenditure from the year 1990-2004. That also shows that there are high increasing trends in IT expenditures in local banks in the past six years (1999-2004). Surprisingly, the same results are found for the entire banking sector i.e. the net income for all the banks for the year 1999-2004 is PKR 26,213,999,000 and IT expenses are 4,505,387,500 which are 17.19% of the net income for the same period but these expenses are 76.33% of total It expenditure for the year 1990-2004. It indicates that there is high increase in IT expenditures in the entire banking sector during the year 1999-2004. To investigate the linkage between the It expenditure and increase/decrease in number of total and IT employees, we observed that during the sample period, the number of IT employees have increased in the banking sector but total employees have been decreased. Further, our regression analysis also shows
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(Table 6) that this increase has positive impacts on income (p-value < 0 0.05). Table 7(a,b,c) and Graph 1 to 3 report the summary of net income/ IT expenses and % increase/decrease of income to expense.

ii.

Manufacturing Sector
a. Local Manufacturing Companies: The regression analysis shows that IT has

positive impacts on the incomes of the local manufacturing companies i.e Atlas Honda and Lakson Tobacco (p-values < 0.05). But IT has no impact on the income of D.G. Cement, Packages and Services Industries, (p-value > 0.05). Further analysis for all local manufacturing companies for the years 1990-2004 and 1999-2004 shows that IT has positive impacts on income of all the local companies as p-value is far below .05 for group 1 and 2 (Table 3 & 4). The regression coefficient for these companies is positive, which indicates the decisive impact of IT on income. At the same time, net income for these companies for the years 1990-2004 is PKR 14,118,508,000 and IT expenditures are 1,374,077,480 which are only 9.73% of net income. Whereas, net income for the year 1999-2004 is 9,791,169,000 and IT expenses are 950,434,480 that are 9.71% of the net income of 1999-2004 but 69.17% out of total IT expenditure of 1990-2004. For group 2 the net income for these companies for the years 1999-2004 is PKR 16,455,436,909 and IT expense are 1,436,243,780 which are low as 8.73% of net income.

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As also seen from Figure in Annexure II, there is a gradual increase in total and IT employees till year 2002. It is due to the facts that some of these companies have expanded their operations during these years and consequently the volume of transaction/job has been increased, resulting therein an increase in staff strength. After year 2002, there is a slight decrease in IT employees because of the reasons that some of these companies have implemented S.A.P/Oracle and maintenance of IT systems is outsourced to ERP providers. b. Foreign Manufacturing Companies : It has also been observed from regression analysis that IT has no impact on the incomes of I.C.I and Unilever Pakistan Ltd (p-values > 0.05). Furthermore there are three companies, SIMENS Pakistan Ltd, Suzuki Ltd and P.T.C for which IT has positive impacts on the income (p-value< 0.05). Our analysis for group 1 and for group 2 presents that IT has no impacts on income of foreign companies as overall (p-value>0.05). The net income for these companies for the years 1990-2004 is PKR 22,371,542,000 and IT expense are 10,453731,000, which are high as 46.73%. Where as net income for the year 1999-2004 is 16,439,359,000 and IT expenses are 5,934,785,000, which are 36.10% of the net income but 56.77% of the total IT expenditure from 1990-2004.

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ncome for all the Income for the year Comparison for All companies for the year 1990-2004 banks & IT Expense
Table 7(a)
Sector Foreign Banks Local Banks Total Banking Sector Local Manufacturing Foreign Manufacturing Total Manfacturing Sector Total All Companies Net Income 11,429,932,000 28,040,686,000 39,470,618,000 14,118,508,000 22,371,542,000 36,490,050,000 75,960,668,000

For Group 1 : n=20


IT Expenses 1,715,997,260 4,185,681,800 5,902,679,060 1,374,077,480 10,453,731,000 11,827,808,480 17,730,487,540 Expenses %of income 15.02 14.93 14.95 9.73 46.73 32.41 23.34

Graph 1
Expense % of Income
Comparison of Income & IT E xpenses for Comapanies for the year 1990-2004 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Manufacturing Manufacturing Foreign Banks Tatal Banking Local Banks Foreign Sector Local Tatal

Manufacturing

Series1

Series2

Series 1 Show the Income Series 2 Show the Expense % of Income


Income & IT expense Comparison for all companies for the year 1999-2004 Table 7 (b)
Sector

For Group 1 : n=20


Net Income IT Expenses Expenses %of income %age of 1999-2004 expenses to 1990-2004 Expenses

Foreign Banks Local Banks Total Banking Sector Local Manufacturing Foreign Manufacturing Total Manufacturing Sector Total All Companies
Expense % of Income

7,440,175,000 18,773,824,000 26,213,999,000 9,791,169,000 16,439,359,000 26,230,528,000 52,444,527,000

1,050,855,000 3,454,532,500 4,505,387,500 950,434,480 5,934,785,000 6,885,219,480 11,390,606,980

Companies

Sector

Total All

14.12 18.4 17.19 9.71 36.1 26.25 21.72

61.2 82.53 76.33 69.17 56.77 58.21 64.24

Graph 2.
C pa om rison of Incom &IT E e xpenses for C apa om nies for the year 1 -20 999 04

100% 80% 60% 40%


Manufacturing Manufacturing Manufacturing Foreign Banks Tatal Banking Local Banks

20% 0%

S ries1 e

S s2 erie

Series 1 Show June 22-24, 2008the Income Oxford, UK

Series 2 Show the Expense % of Income 27

Companies

Foreign

Sector

Total All

Sector

Local

Tatal

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Income & IT Expense Comparison for all Companies for the year 1999-2004
Table 7(c) Sector Foreign Banks Local Banks Total Banking Sector Local Manufacturing Foreign Manufacturing Total Manufacturing Sector Total All Companies
Expense % of Income

For Group 2 : n=32 Net Income 18,616,763,000 28,710,716,000 47,327,479,000 16,455,436,909 17,604,147,000 34,059,583,909 81,387,062,909

IT Expenses 2,460,082,000 4,479,494,500 6,939,576,500 1,436,243,780 6,055,853,900 7,492,097,680 14,431,674,180

Expenses %of income 13.21 15.60 14.66 08.73 34.40 22.00 17.73

Graph 3.
C p rison o Inc e &IT E p ses fo C m pa om a f om x en r o a nies for the y r 1 9 -2 0 ea 9 9 0 4

100% 80% 60% 40%


Manufacturing Manufacturing Manufacturing Foreign Banks

20% 0%

Tatal Banking

Local Banks

S rie e s1

S rie e s2

Series 1 Show the Income

Series 2 Show the Expense % of Income

For group 2, net income for the years 1999-2004 is PKR 17,604,147,000 and IT expense are 6,055,853,900, which are 34.40% of net income. Like local companies, there has been an increase in total and IT employees. Table in Annexure II represents these results. Again this increase is considered due to expansion in production over the period of last ten years. So, the volume of transactions/jobs and employees have been increased. c. All Manufacturing Companies: The overall analysis of all the manufacturing companies for group 1 & 2 further validated that IT has no impacts on income of all the manufacturing companies (p-value >.05). But surprisingly, there is marvelous increase in the net income for all the manufacturing companies for the
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Companies

Foreign

Sector

Total All

Sector

Local

Tatal

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years 1990-2004, i.e. PKR 36,490,050,000 and IT expense are 11,827,808,480 being 32.41% of net income. For the years 1999-2004 net income for these companies is 26,230,528,000 and IT expenses are 6,885,219,418 which are 26.25% of net income. There is an increase in the IT expenses during the last six years i.e. 1999-2004 as IT expense ratio of net income is 58.21% out of the total IT expenses for the years 1990-2004 despite of the above facts that IT is not contributing more to incomes of these companies. There is an increase in total and IT employees and this increase is due to the same reasons as mentioned above. Tables in Annexure II presents clearly these effects. For group 2 the net income for all the manufacturing companies for the years 1999-2004 is PKR 34,059,583,909 and IT expense are 7,492,097,680 which are 22% of net income. The regression coefficient is positive for this group. Similar to group 1, the same pattern of increase in total and IT employees appears. It is more obvious if we look into the computer usage statistic of manufacturing companies in Annexure III that only those manufacturing companies (local & foreign) dominate the scene which have excellent IT systems and have also implemented world class E.R.P systems i.e SAP or Oracle.

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All Companies In Both The Sectors: After analyzing the performance of individual sector, the analysis is made to know about performance of all the companies in banking and manufacturing sectors for group 1 and 2. As discerned, IT has positive impacts on income of all the companies (p-value<0.05). The regression coefficient is also positive which shows that there is an increase in income after increase in IT expenses. So far net income for all the manufacturing companies for the years 1990-2004 is concerned, it is PKR 75,960,668,000 and IT expenses are 17,730,487,540 which are 23.34% of net income for 1990-2004. For the years 1999-2004 net income for all companies is 52,444,527,000 and IT expenses are 11,390,606,980 which are 21.72% of net income. Similarly, net incomes for group 2 for all the companies for the years 1999-2004 are PKR 81,387,062,909 and IT expenses are 14,431,674,180 which are 17.73% of net income. There appears to be constant increasing trends in the IT expenditures during the last six years i.e. 1999-2004 in both the sectors. As the IT expense for these years for both the sectors are 64.24% out of total IT expenses for the years 1990-2004.

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There can be several reasons for these increasing trends in the IT expenditures. Firstly, there was now proper recognition of the importance of IT at government level till 1990s. The government has started playing its role more aggressively in creating ITs awareness and encouraging its use in the country for the last 4-5 years. It has also reduced import duties and sales tax on IT items which in turns substantially lowered down prices of IT products, enabling companies to buy and introduce new IT in every functional area more freely. Secondly, reduction in communication charges by PTCL as well as availability of state-of-theart world standard IT infrastructure with latest communication channels i.e. DSL, VSAT, Radio link etc. is a great attraction for the companies to replace their old hardware and software. Most of the companies are now upgrading their existing infrastructure to make it in line with world standards. Thirdly, due to revised and strong economic polices of the government, most of the multinationals that were previously working with low profile have started expansion of services or diversification of products. Therefore, to support this they have started investing more in their IT set up in the recent past. Conversely, to stay abreast of competition, the local companies are also improving their IT setup by investing more in it. The last plausible reason for incremental investments in IT by these companies during the recent years is the availability of new and modern computer systems/IT products in the market, which were not available few years back. So, aforementioned initiatives seem to have compelled all companies to introduce modern technologies in their work to earn more profits, thereby increasing IT expenses. So far as total and IT staff strength is concerned as reported in Annexure II, there is an increase in IT but decrease in total staff and reasons for this increase have already been discussed in detail in individual banking and manufacturing sections.

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Conclusion:
IT has revolutionized and redefined all aspects of human interaction in social, business or other. It has turned world in global village where limits of time and location no more apply. The companies use IT to get improved efficiency and effectiveness. This use has grown at an astonishing rate over the past three decades. Now, Information Technologies permeate nearly every aspect of modern business operations and communications. As computing and networking machinery proliferated into every aspect of business life, the pressing need to manage these technologies effectively has grown accordingly. Realizing the need of time like other countries, in Pakistan banking & manufacturing industries are also using IT to increase their performance in almost all areas. Information Technology has become means of better production and services in these industries. An advancement in production and communication through IT has changed the nature of working for both the industries. In addition introduction of Internet and advancement in computer connectivity have given companies an opportunity to conduct their business on-line. It is also encouraging that the IT initiative is being fully supported by the regulators very cautiously towards development of complete E-Commerce/E-Banking status in Pakistan. It is therefore, predicted that the future of the banking and manufacturing industrys Information Technology efforts and its spending will continue to increase in importance for the transition of traditional organizations into virtual organizations. The recent statistic revealed that with this aim the total spending on computer & Information Technology is projected to increase by about 100 percent by the year 2010. It is observed that the IT has positive impact on performance of both the industries. According to above discussions, the banking industry is seemed to be more benefited with IT than that of Manufacturing. It would appear from above analyses
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that Information Technology in Pakistan is being applied aggressively

both in

manufacturing and banking sectors but it is being used more efficiently in banking sector than the manufacturing sector. The following salient points of above discussion are worth stressing that 1) the local banking sector of Pakistan is using IT more discreetly than the foreign banks 2) there is high rise in IT investments in local baking sector in the latest IT systems in the recent years as compared to foreign banking sectors as percentage of IT expenses for the years 1999-2004 for total banking sector, are 76.33%, out of their total IT expenses for the years 19902004. 3) the percentage increase in IT expenses in local banks is 82.53% for the year 1999-2004 out of expenses of the years 1990-2004, which is much higher than the foreign banks where %age increase is 61.20%. 4) in comparison of local versus foreign manufacturing companies mixed trends have been observed in IT spending. The IT expenses percentage is 69.17% and 56% respectively for both the sectors out of incomes of years 1990-2004. But surprisingly, percentage IT expense for local and foreign companies for the years 1990-2004 as a whole are 9.73% and 42.33%. For group 2 these expenses %ages are 8.33 and 34 respectively. It is, therefore, evident that overall foreign manufacturing sector is investing more in IT than the local manufacturing sector. 5) overall, there is remarkable increase in the IT expenses and in income in return, of all the companies, given to the facts that IT expenses are 17,730,487,540 in 1990-2004 and in 1999-2004, these are 11,390,606,980 which are 64.24% of total IT expenses. The net income is 75,960,668,000 in the years 1990-2004 and for the years 1999-2004 it is 52,44,527,000. The percentage increase in net income thus comes to 69.04% for year 1990-2004. We find strong evidence through above facts that though manufacturing sector is investing much more in IT but the banking sector surpass the manufacturing sector in performance. On the other hand the study also detected that there is an increase in IT employees in both the sectors due to increased work because of expansion of operations of the companies over the years but decrease in total employees because of implementation of down/right sizing policies in local baking
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sector since 1990s. In line with above results, in final conclusion, we say that IT has positive impacts on the performance of the organizations and we accept our research hypotheses.

References
Ahmad Nisar Sh.(2001), IT: Impact on the business and way of life, Pakistan & Gulf Economist, July 30-August 05, 2001. Ahmed Tasawar(2003), E-Banking and its status in Pakistan, Economic Review, pp30-33 Ahmad Khalil(2005), Better Late Than never, Pakistan & Gulf Economist, Vol xxiv, no 49, December 5-11, 2005.pp 32. Akhtar Shamshad(2006), Roadmap of financial sector of the country, Business Recorder, Wednesday, 17 May ,2006. Akhtar Shamshad(2006), Pakistans Financial Services Sector A Future Perspective, Money Plus, July 31, ,2006. Aslam Syed M.(2001), Information Technology: Moving in the right direction, Pakistan & Gulf Economist, Vol XX, No 31, July 30-August 5, 2001 Page 12-14. Aslam Syed M.(2001), Information Technology: What NEXT, Pakistan & Gulf Economist, June 18-24, pp 14-16. Aslam Syed M.(2003), Information Technology, Pakistan & Gulf Economist, Vol XXII, No 20, May 19-25, 2003, Page 30. Anadarajan, M. & Anakwe, U.P (2002), IT acceptance in a less-developed country: A motivational factor perspective, International Journal of Information Management, 2002, pp. 47-65. Attewell, P and Rule, J. (1984), Computing in Organizations: What we know and what we dont Know, Communication of the ACM, 1184-1192. Ayub, Imran(2006), Software exports jumps 50%, Business Recorder, July 200. Bender, D. (1986) Financial impacts of information processing, Journal of MIS, Vol 3, no 2, pp 232-238. Brynjolfsson, E (1993), Information Technology and efficient Management of modern enterprise, Journal Of Organizational Computing, pp 41-51. Brynjolfsson, E (1993), Productivity paradox of information technology, Comm. ACM, (12), pp66-67. Brynjolfsson, E and Hitt L.M(1996), Paradox lost? Firm Level evidence on the return to information systems, Management Sciences, 42(4), pp24-36. Brynjolfsson, E and Hitt L.M(1998) Beyond the productivity paradox, Comm. ACM, 41(8):49-55. Bhide M.G(1997), Information Technology in Banks, Journal of Indian Institute of Banker. 6894), December-1997. pp 149-152. Biswas Soumitra(2005), Information Technology in services sector-A vision for India, Technology information, forecasting and assessment council. Department of Science & Technology, New Delhi, pp2. Chan Stephen L.(2000), Information Technology in Business Process, Business Process Management Journal, Vol 6, no 3, pp 224,237
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Choi Soon-Yong & Whinston Andrew B.(2001), Internet-Based Globalization and International Division of Labor, The IT revolution and developing countries: Late comer advantage. Institute of Development Economics IDE, Japan 2001, pp 317-338. Dasgupta S., Sarkis J and Talluri s(1999), Influence of Information echnology investment on firm productivity: a cross sectional study, Logistic Information Management, Vol, 12, pp 120. Davis, F.D(1993), User Acceptance of Information Technology System Characteristics, user perception and behavioral impacts, International Journal of Man-machine Studies, Vol 38, pp475-487. Dewan, S. and Kraemer, K.L(1998), International dimensions of the productivity paradox, Communication of the ACM Vol 41, no 8, August, pp55-66. Drucker, P.(1992), The new society of organizations, Harvard Business Review, September/October, pp. 95-105. Earl, M., Edwards B., & Feeny, D. (1996), Configuring the IS Function in Complex Organizations, Information Management, The Organizational Dimension edited by Earl, M., pp201-230, Oxford University Press, Great Clarendon Street, Oxford, NY. Farooq M. & Mahmood Tariq(2005), Information Technology & E-Governance, Pakistan Development Review, February 2005, pp 50-57. Frenzel Carroll W.(1999), Management Of Information Technology, 3rd edition. Pp10. Franklin, C.F.Jr(1997), Emerging Technology: Enter the Extranet, CIO Magazine, May 15, Available online: www.cio.com/archive/051597_et_content.html. Ghauri Salim(2003), IT status in Pakistan, Pakistan & Gulf Economist, Vol. XXIII, no 94, December. 6-12, 2003. pp 34. Ghauri Salim(2006), A good start of 2006 for IT industry, The Nation, Monday, February 27, 2006. Ghauri Salim(2006), Prospects and problems of IT industry, DAWN, Monday, February 06, 2006. Gupta Uma G.(2000), Information Systems: Success in the 21st Century, PrenticeHall International U.S.A. pp. 17, 360-372. Gupta Uma G.& Collins W(1997), The impact of information systems on the efficiency of banks: an empirical investigation, Industrial management & Data Systems, pp10-16. Gupta Uma G.(2000), Information Systems: Success in the 21st Century, Prentice_hall International U.S.A. pp. 17, 360-372. Harris, R. & Davison, R. (1999), Anxiety and Involvement: Cultural Dimensions of Attitudes toward Computers in Developing Societies, Journal of Global Information Management, PP.26-38. Hill Carole E. Straub Detmar W & Loch Karen D.(2002), Transfer of Information Technology to the Arab World: A Test of Cultural Influence Modeling, Published in Information Technology Management in Developing Countries, IRM Press, U.S.A. PP. 92-134. Ho, Chia-Fu(1996), IT implementation strategies in manufacturing organizations, International Journal of Operations Research & Production Management, Vol 16, no. 17. pp 77-100. Hussain, Asad Syed(2003), Economies of IT: Pakistan IT sector Analysis, Economic outlook, October 2003, pp21. Imam Ali Z(2002), Status Of IT industry in Pakistan, Pakistan & Gulf Economist, Vol. XXII, no 49, October 16-22, 2002. pp 34-36. Ismail S. Mustafa(2003), Approaches to E-Finance, Management Accountant, November 2003. p39-40.
June 22-24, 2008 Oxford, UK

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2008 Oxford Business &Economics Conference Program

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Karr, J.(1996), Technology spending and alliances: new highs in financial service firms, Journal of Retail Banking Services, Vol. 183, pp 45-48. Khan Ather Mahmood and Shah Qamar Ali(2004), Impact of information and communication technology on decent work in Pakistan, Pakistan Manpower Institute, Ministry of Labor, Manpower & Overseas Pakistanis, Government of Pakistan. A study report published on 9th December 2004. pp5,22,40,44. Khan Aziz Umar(2005), IT initiatives from the government, The Nation, Monday, March 28, 2005. Kazmi Shabbir H.(2003), IT In Core Industries, Pakistan & Gulf Economist, Vol. XXII, no 26, June 30-July 6, 2003, pp 12-13. Kazmi Shabbir H.(2004), E-Banking, Pakistan & Gulf Economist, Vol. XXIII, no 48, November 29-December 5, 2004, pp12-14. Kazmi Shabbir H(2005), A lot needs to be done to make IT use common, Pakistan & Gulf Economist, Vol xxiv, no 49, December 5-11, 2005.pp 14. Kelley, M. R (1994), Productivity and Information Technology: The elusive connection, Management Sciences. 40(11), pp 1406-1425. Kemal A.R(1999), Pattern And Growth of Pakistans Industrial Sector, In 50 years of Pakistans Economy edited by Shahrukh Rafi Khan, Oxford University Press Karachi. pp150-174. Kendall & Kendall (1999), Systems Analysis & Design, Prentice Hall International Inc. New Jersey, U.S.A. Kolachi, Nadir Ali(2004), An interdependence model for business and IT education Pakistan & Gulf Economist Vol XXIII, no 49, December 6-16, 2004. pp34-36. Long Larry and Long Nancy (1999), Computers, Prentice Hall Inc. U.S.A. pp71. Loveman, G.W(1994), An assessment of the productivity impact on information technologies, Research Studies, Information Technology Press, Cambridge, MA, pp 84-110. Mahmood, M.A & Mann, G.J. (1993), Measuring the organizational impact of information technology investment: An exploratory study, Journal of Management Information Systems. 10(1), pp97-122. Mahmood, M.A & Mann, G.J. (2000), Special Issue: Impacts of information Technology investment on organizational performance, Journal of Management Information Systems pp.3-10. Marshall Tom(2002), E-Finance: An Ill tempered fight for supremacy, Euromoney, 33(401), Sep-2002, pp138-139. Mahmood, Javed (2006), 2006 another productive year of Banks, Money plus 17 June 2006. Mahmood, Javed (2006), Where Pakistan stands in the global economy, Money plus 26 June 2006. Mahmood, M.A & Mann, G.J. (2000), Special Issue: Impacts of Information Technology investment on organizational performance, Journal of Management Information Systems pp.3-10. Martin, E.W., Brown, C.V., DeHayes, D.V., Hoffer, J., Perkins, W.C.,(1999), Managing Information Technology: What Managers need to know, Prentice-Hall, Upper Saddle River, NJ. Pp24. Martini Marco(1999), Impact of IT on the Banking and financial industry, Review of economic conditions, 1999(2), pp203-223.
June 22-24, 2008 Oxford, UK

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2008 Oxford Business &Economics Conference Program

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Mayer Martin(1987), The Humbling of Banks America, The New York Times, May 3, 1987, pp 27. McClenahen J.S(2000), Unstoppable improvement, Industrial Week, pp85-95. Mitra, S and Brendt, E.R(1990), Analyzing cost-effectiveness of organizations: the impact of Information Technology spending, Journal of Management Information Systems. Vol 13, no 2, pp 29-57. Morrisi Tersa L(1998), An application Of Advance Technology in Electric Industry, The Monthly Labor Review, 1998, pp 31. Mujahid Yousaf Haroon(2003), E-Commerce & WTO, Pakistan & Gulf Economist, Vol. XXII, no 6&7, February 10-23, 2003, pp32-40. Nsouli Saleh M.(2002), Challenges of E-Banking revolution, I.M.F Finance & Development. 39(3), September 2002. pp48-51. ODell,Elliot, S.,C.(1999), Sharing knowledge and best pratices: the hows and whys of tapping your organizations hidden reservoirs of knowledge, Health-care Forum Journal, Vol 42, pp. 34-37. Olalla, Marta Fossas(2000), IT in business process reengineering, International Advances in Economic research, Vol. 6, issue 3, pp581-590. Osama Ather(2005), Making up for ITs lost decades, The Dawn, 4th July, 2005. Oz, Effey(2002), Management Information Systems, 3rd edition, Course Technologyreprinted by Thomson Asia Ltd. Singapore. Pp267-271, 166-204, 210-224, 353-391. Parthasarthy, R and Sethi, S.P. (1993), Relating strategy and structure to flexible automation: A test of fit and performance implications, Strategic management Journal, 14(7). Pp 529-549. Paku K & Vlosky R.P(2002), A model of the impact of corporate culture on Information Technology adoption, Working paper no 57, School of Renewable Natural Resources, Louisiana State University Agriculture Centre, Baton Rough, L.A. Pasha M.A(2005), Securing the Future of IT education in Pakistan, Journal Of Research(Humanities), B.Z.University Multan. 2005, Vol 24, pp95-105. Pasha Mustafa Kamal(2005), Future Vision of Information Society in Pakistan, The Nation, 8th August, 2005. Rehman Atta A(2002), IT: The Great Opportunity, http:lid awn, com/ events/ infotechatl.htm. Rizvi Shamim Ahmad(2005), IT making strides in Pakistan, Pakistan & Gulf Economist, Vol xxiv, no 49, December 5-11, 2005.pp 12-13 Robbins Stephen P. & Coulter, Marry(2003), Management, 7th Edition, Prentice Hall, Int. U.S.A. pp.79. Rumizen, M.(1998), Site Visit: how Buckman Laboratories shared knowledge sparked a chain reaction, Journal of Quality & Participation, Vol 21, pp34-38. Saeed, Kh. Amjad(2003), Economy Of Pakistan, Khawaja Amjad Saeed Publisher, 2003, pp75-104 Shafiq, Muhammad(2001), E-Commerce: A practical guide to decide for the future business sharper, Pakistan Accountant, 33(2), April 2001, pp47-56. Shahid Muhammad(2005), A real IT professional in Pakistan, The News International, Wednesday, March 30, 2005. Schmidt, J.B, Montoya-Weiss, M.M. and Massey, A.P. (2001), New product development decision-making effectiveness: Comparing individuals, face-to-face teams, and Virtual teams, Decision Sciences, 32(4), pp 575-600.
June 22-24, 2008 Oxford, UK

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2008 Oxford Business &Economics Conference Program

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Sohal Amrik S, Moss Simon and Lione N(2001), Comparing IT success in manufacturing and service industries, International Journal of Operations & Production Management, Vol 21, no , pp 30-45. Shelly G.B, T.J. Cashman, M.E. Verment(2004), Discovering Computers: A gateway to information Web Enhanced, Thomson Course Technology Boston, U.K. Syed Mustafa(2006), E-banking: Are we there yet, Business Recorder, 3oth , July, 2006. Stephen Koepp(1984), Banking takes a beating,, Time, December 3,1984, pp48. Strachman, D.(1994), PCs are catching on faster at community banks, American Banker, Vol 159, no 156, pp4-6. Strocken, J,H,M.(2000),Information Technology, innovation and supply chain structure, International Journal of Technology Management, 20(1-2), pp156-175. Torkzadeh, G, and Angulo, I.E(1992), The concept and correlations of computer anxiety, Behavioral and Information Technology Journal, Vol 2, pp99-108. Vasudevan A.(2003), Some perspectives on IT up gradation in the financial sectors, Journal of Indian Institute Of Bankers. 74(1), Jan-2003, pp36-38. Venkatesh, V., & Davis F.D. (2000), A theoretical extension of the Technology Acceptance Model, Journal of Management Sciences Vol. 2, pp. 186-204. Walrad, C,. & Moss, E. (1993), Measurement: The key to application development quality, IBM Systems Journal. 32(3), pp. 445-460. Well. P. and Olson, M.H. (1989), Managing Investment in Information Technology Mini Case Examples and implications. MIS Quarterly, March 1989, pp.3-16. Wheelen T.L and Hunger J.D(2000), Startegic Management, 7th edition, printice Hall, U.S.A, pp231-235. Witzel M(1998), Dictionary of Business and Management, Thomson Learning Inc. U.S.A. pp41-45. Wetherbe J, Turban E, & Mclean E(1999),Information Technology for management: Making connections for strategic advantages, 2nd edition, New York, NY: John Wiley and Sons Inc. William, B.K & Sawyar, S.C(2005), Using Information Technology, 6th edition, McGraHill Publishing Co. U.S.A, pp3,4,147 Websites of :
Computer Society Of Pakistan: www.csp.org.pk Connect IT Pakistan: www.connectitpakistan.com Electronic Government Directorate Of Pakistan: www.e-government.gov.pk Federal Bureau of Statistic of Pakistan: www.fbs.gov.pk Ministry of Information Technology Of Pakistan: www.Moitt.gov.pk Ministry of Science & Technology Of Pakistan: www.Most.gov.pk Pakistan Government: www.pakistan.gov.pk, www.infopak.gov.pk Pakistan Presidents web site: www.Presidentofpakistan.com Pakistan Software Export Board: www.pseb.org.pk Pakistan Computer Bureau: www.pcb.gov.pk Pakistan Software Houses Association: www.pasha.org.pk Pakistan Telecommunication Corporation: www.ptcl.org.pk Pakistan Telecommunication Authority: www.pta.gov.pk Sate Bank of Pakistan: www.sbp.org.pk

June 22-24, 2008 Oxford, UK

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Annexure 1

List Of Companies In Sample


The list of companies surveyed for this study is given as under. Banking Sector
List Of Local Banks 1 Habib Bank Ltd. 2 National Bank Ltd. 3 United Bank Ltd. 4 Muslim Commercial Bank Ltd 5 Bank Al Habib Ltd 6 Metropolitan Bank Ltd. 7 Bank Of Punjab 8 Askari Commercial Bank Ltd. 9 Bank Alflah Ltd. 10 Allied Bank Ltd. 11 Faisal Bank Ltd. 12 First Women Bank Ltd. List Of Foreign Banks 1 American Express Bank Ltd. 2 Citibank N.A. 3 Habib Bank AG Zurich 4 Algemene Bank Netherland (ABN Amro) 5 Internaional Islamic Bank 6 Deutsche Bank A.G. 7 Rupali Bank Ltd. 8 Standarad Charterd Bank 9 Oman International Bank Ltd. 10 Bank Of Tokyo Ltd. 11 Mashraq Bank Ltd. 12 Hong Kong & Shangai Bank Ltd.

Manufacturing Sector List Of Pakistani Manufacturing Companies.


1 2 3 4 5 6 7 8 9 10 11 12 Packages Ltd General Tyres Ltd. D.G. Khan Cement Ltd Atlas Honda Cars Ltd. Pakistan Steel Ltd. P.E.C.O Ltd. Lakson Tobacco Ltd. Indus Motor Ltd. Service Industries Ltd P.E.L Ltd. Dawllance Pakistan Ltd Honda Atlas Ltd.

List of Foreign Manufacturing Companies


1 2 3 4 5 6 7 8 9 10 11 12 Uni Lever Pakistan Ltd. Reckett Benkiser Pakistan Ltd Procter & Gamel Pakistan Ltd. Philips Electrical Company Ltd. Siemens Pakistan Ltd. I.C.I Pakistan Ltd. Nestle Pakistan Ltd. Colgate Pakistan Ltd. Pakistan Tobacco Ltd. Suzuki Pakistan Ltd. Bata Pakistan Ltd. L.G Pakistan Ltd.

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ISBN : 978-0-9742114-7-3

Total and IT Employee Statistics


Annexure II
All Foreign Banks
Years IT emply % Tot Emply 407 422 442 475 542 590 662 803 831 894 912 931 964 1045 1216

All Local Banks


IT emply % Tot Emply 45735 45743 45983 47101 47513 49805 51770 44903 41161 38804 39167 37284 33582 33949 34261

All Banks
IT emply % Tot Emply 46142 46165 46425 47576 48055 50395 52432 45706 41992 39698 40079 38215 34546 34944 35477

1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05

4.176904177 5.213270142 5.882352941 5.052631579 5.350553506 4.915254237 4.380664653 3.362391034 3.369434416 4.026845638 4.057017544 4.618689581 4.771784232 4.688995215 4.523026316

0.397944681 0.435039241 0.484961834 0.507420225 0.524067097 0.530067262 0.550511879 0.677014899 0.74828114 0.801463767 0.814461154 0.893144512 1.083914002 1.148781997 1.170427016

0.431277361 0.478717643 0.53634895 0.552799731 0.578503798 0.581406886 0.598870919 0.72419376 0.80015241 0.874099451 0.888245715 0.983906843 1.186823366 1.256295788 1.285339798

All Local Manufacturing


Years IT emply %

All Foreign Manufacturing


IT emply %

All Manufacturin g
0.487062405 13420 0.510318949 13667 0.509202008 13994 0.525997796 14567 0.564353991 14662 0.596222774 14760 0.629444388 14928 0.660278333 15011 0.691586263 15075 0.769851409 15117 0.783315706 15192 0.815708976 15237 0.790727215 15783 0.818247875 15828 0.809100864 15891

All Companies
Tot Emply 72422 72815 73919 75713 76406 79411 81823 75239 71634 69444 70335 68618 66036 66647 68353

Tot Emply IT emply %

Tot Emply emply % IT

1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05

0.357698289 0.392821382 0.4 0.420044215 0.438308131 0.427890011 0.463251054 0.495799477 0.528592023 0.581037665 0.610727562 0.64618225 0.611192462 0.631911532 0.600529879

0.611028316 0.62193605 0.614549092 0.624699664 0.682035193 0.758807588 0.790460879 0.819399107 0.849087894 0.952569954 0.95444971 0.984445757 0.969397453 1.004548901 1.032030709

0.451520256 26280 0.490283595 26650 0.526251708 27494 0.542839407 28137 0.573253409 28351 0.586820466 29016 0.609852975 29391 0.699105517 29533 0.755227964 29642 0.829445308 29746 0.843107983 30256 0.909382378 30403 0.846507965 31490 1.047308956 31653 1.056281363 32876

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Pakistani Top Banks & Manufacturing Companies IT Usage Summary/Statistics

Local Banks
Sr. no Company Year of start in Pak. 1942 1992 Year of starti ng IT 1978 1992 Name of Standard application Unibank Swift Unibank Swift Year of Installing standard Application

1 2

Allied Bank Ltd. Askari Commercia l Bank Bank Of Punjab Bank AlHabib Ltd. Bank Alflah Ltd Faisal Bank Ltd First Women Habib Bank Ltd. Metro Politan Bank M.C.B NBP United Bank Ltd.

1998 1992

1989

1989

4 5 6

1992 1997 1987

1992 1997 1992

7 8 9 10 11 12

1989 1943 1992 1948 1949 1959

1989 1966 1992 1970 1980 1967

Bop2001 in house software package No standard application No standard application IBS in hose system but Purchased Sibol No standard application MOBS, SWIFT, MISYS No Standard Application Sibol Planning for FIDILITY system Unibank, Swift, CTL

No standard application

No standard application No standard application 2005

No standard application 1995, 2003 No Standard Application 2001 No Standard Application 1995

June 22-24, 2008 Oxford, UK

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2008 Oxford Business &Economics Conference Program

ISBN : 978-0-9742114-7-3

Pakistani Top Banks & Manufacturing Companies IT Usages Summary/Statistics

Foreign Banks Sr. Company Name Year of starting Busines in Pak. 1980 Year of starti ng IT 1990 Name of Standard application SBS(Standard Business application), In House developed In House developed In House developed In House Development, Citibank World wide one package In House developed In House developed In House Global development In House Development BANK GENERAL EBBS global application In House Development Year of Installing standard Application 1997,2003

01

American Express Bank Ltd. ABN Amro Bank Ltd. Bank Of Tokyo Citi Bank N.A

02 03 04

1948 1980 1980

1990 1988 1988

1995 1988 1988

05 07 08 09 10 11 12

Deutsche Bank Ltd. Habib Bank AG Zurich Hong Kong Shanghai Bank Ltd Oman International Bank Rupali Bank Ltd. Standard Chartered Bank Mashraq Bank Ltd.

1962 1979 1982 1996 1976 1947 1996

1990 1990 1985 1996 1988 1985 1996

1995 1990 1985 1996 1995 1995 1996

June 22-24, 2008 Oxford, UK

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Pakistani Top Banks & Manufacturing Companies Summary/Statistics Foreign Manufacturing Companies
Sr. No 1 Company Name Year of starting Busines in Pak. 1960 Year of starting IT 1985 Name of Standard application Core systems from Head office, Payroll from systems Ltd. In House developed SAP(ERP) Germany No standard application S.A.P (ERP systems) S.A.P (ERP systems) No Standard systems JD Edwar/Oracle MFG/Pro S.A.P world wide, Platinium in Pakistan S.A.P P-GIS, ERP stnadarad systems, J>D Edward/Oracle Year of Installing standard Application Installed As/400 in 1985 IBM Mini & Servers, No standard Application 2000 No standard application 2000 2000 1999 2001 2000 1999 2005 1998

Bata Pakistan Ltd.

Colgate Pakistan Ltd. I.C.I Pakistan Ltd. L.G Pakistan(New Allied Electronic) Pakistan Tobacco Co. Simens Pakistn Ltd. Suzuki Pakistan Ltd Reckitt Benkiser Pakistan Ltd. Uni lever Pakistan ltd. Proctor & Gamels Pakistan Ltd. Nestle Pakistan Ltd. Philips Electrical Co. Pakistan ltd

1985

1990

3 4 5 6 7 8 9 10 11 12

1960 1989 1948 1965 1985 1970 1965 1970 1988 1949

1985 1990 1985 1980 1982 1982 1970 1980 1988 1970

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2008 Oxford Business &Economics Conference Program

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Pakistani Top Banks & Manufacturing Companies IT Usages Summary/Statistics Local Manufacturing Companies Sr. No Company Year of starting Busines in Pak. 1984 1964 1970 1965 1970 1990 1994 1985 1985 1976 1992 1974 Year of starti ng IT 1990 1984 1982 1966 1980 1990 1994 1992 1991 1990 1992 1985 Name of Standard application No standard application No standard application S.A.P S.A.P No standard application S.A.P No standard application No standard application No standard application No standard application S.A.P No standard application Year of Installing standard Applicati on N.A N.A 2005 2000 N.A 2000 N.A N.A N.A N.A 2003 N.A

1 2 3 4 5 6 7 8 9 10 11 12

D.G.Khan Cement Ltd. General Tyres Ltd Lakson Tobaco Ltd. Packages Ltd. Service Industries Ltd. Indus Motors Ltd Honda Cars Ltd. Pakistan Electric Company Dawlence PECO Atlas Honda LTd Pakistan Steel

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