The Impact of information and communication technology usage on bank branch performance : perspective of a leading commercial bank in Sri Lanka

Abstract

Banks are investing huge amounts of money on Information and Communication Technology (ICT). After successful implementation of comprehensive banking solutions, institutions are now being concerned. about the usage levels and the returns of such investments. Initial findings indicate a scarcity of empirical research with respect to benchmarking on the ICT usage at bank branches in Sri Lanka and the impact of ICT on overall bank branch performance. This research study aims to provide an analysis on the impact of ICT usage at branches on the overall bank branch performance. It is from a perspective of a leading commercial bank in Sri Lanka. They have implemented a new comprehensive banking solution with a branch network commencing from the year 2004. The study is based on the analysis of primary and secondary data collected for the study. Perceptions of 18 branch managers selected from 18 branches, a minimum of 5 staff members and a minimum of 5 customers attached to each of the same set of branches of the bank were collected using survey method. All 18 branches selected are of an equivalent grade and situated in the western province of Sri Lanka. Three types of questionnaires were designed with structured and semi structured questions with 5 point and 4 point likert scale. Questionnaire distribution was done by post, via e-mail and hand delivery. Data analysis was done using bivariate correlation and linear regression. Pearson's correlation coefficient was used to measure the linear relationship between variables. The analysis revealed that ICT usage has a positive linear relationship with financial performance and quality performance- of bank branches. Bank branch performance was found to have a correlation with factors such as staff attitude towards ICT usage, ICT literacy level of branch staff and scope and complexity of the ICT applications. This paper concludes with a discussion and recommendation to overcome the barriers affecting the TCT usage at bank branches.