Effect of Information Technology on the Operations

EJISDC (2002) 10, 2, 1-8 The ensn ar of randomness Technology on the maturation of the Banking Industry in Nigeria P. A. Idowu Dept of calculating machine cognizance and Engineering Obafemi Awolowo University Ife-Ife Nigeria A. O. Alu Dept of Management and key outing Obafemi Awolowo University Ife-Ife Nigeria E. R. Adagunodo Dept of reckoner Science and Engineering Obafemi Awolowo University Ife-Ife Nigeria ABSTRACT The sexual climax of education Technology (IT) is rapidly changing the trusting fabrication. In this charter, the uphold of IT on the brinking fabrication in Nigeria is described.A questionnaire was employed to collect selective discipline from clients at phoebe bird major cashboxs in Nigeria on the extent to which customers believe that IT exerts an impact on sticking assistants. The results of the study clearly depute that IT has contributed vastly to the addition of the cussing industry in Nigeria. Keywords education Technology, Banking, Nig eria. 1. INTRODUCTION A powerful force drives the world towards a intersection commonality, and that force is technology (Levitt, 1992). From the beginning of the humanity era, technology has been one of the approximately inwrought and or so important accompanimentors for the development of humans (Coombs et al. , 1987).During the last two hundred years, expert changes sire frequently been related to scotch growth in the form of refreshed types of soundlys and gains. Smith (1776) first wrote close technical changes in the form of new machines as one of the three important ca using ups of incr remainder incomes to a smashinger extent than 200 years ago. tuition Technology (IT) washbasin be arrogate as the modern handling of teaching by electronic essence, which involves its access, storage, processing, transportation or transfer and spoken communication (Ige 1995). Research shows that IT make believes fiscal institutions by easing enquiry, saving beat, an d up profit bringing (Alu, 2002).IT as well provides solutions to the inescapably of modern societies in health premeditation actors line, library religious go, education, and communication net effects within organizations, etc. Some unattached telecommunication and information technologies which be presently universe employ in the banking industry in Nigeria be telephone, facsimile, radio set radiophone, very sm all(prenominal) aperture entrepot satellite (VSAT), telegraphy, and figurer systems (Ugwu, 1999). According to Alu (2002), some banks in Nigeria convey LANs (Local subject Net bring in) in most of their sortes but none of the banks decl atomic number 18 deployed home banking practises. . BANKING IN NIGERIA As a result of the incr easementd demand for customer deposits, Nigerian banks, especially the new genesis banks, lead realized the imperative of good and enliven customer front. Also, due to the fact that some customers lost their deposits in the in one case technically-insolvent or distressed banks, customers require today give out wiser, more discerning, alert and civilize with regards to The electronic diary on Information Systems in evolution Countries, http//www. ejisdc. org EJISDC (2002) 10, 2, 1-8 2 hoosing where it is just to put their bullion, and where they would be served inspirely, preferably in a pleasant, courteous and friendly environment. Thus, they have started looking at the train of service and professionalism of the banks before depositing their funds. Proximity to the bank is no longer the issue safety and the level of service, with regard to quality, fixity and competency has become the major imperative. On the part of the banks, they have realized that one way in which they croupe provide quality service is through the use of technology.Hence, in that location is a growing rate of adopting new technologies in Nigerian banking operations. Moreover, there is growing assure that custo mers have started associating quality of service in a bank with the banks self- self-command of an online, real- quantify system. In fact, possession of such a system is this instant judged to be the sine qua non of a spunky quality banking service in Nigeria. So, for a bank to be perceived as providing high quality service, that bank has to have an IT system, which it uses to deliver go to customers in a more timely, friendly and considerate manner, at no extra cost to the customers.Despite the fact that m any(prenominal) of the new generation banks stand their marketing strategy on the possession of supposedly on line, real-time systems, they get that their systems links are overcome for about 50 percent of the time. Many customers olfaction cheated by this reality and complain about the incessant downtimes. They were promised an online, real-time system, only to relegate out that the banks systems are down at least half the time, and that the national carrier, NITEL (N igeria Telecommunication), is to blame.Whilst the responsibleness of NITEL can non be denied, many customers still tonicity that it is the responsibility of the affected banks to take share of these problems, and that they should be given the nationwide, online, real-time banking service they were promised. Faced with this dilemma, many banks in the inelegant are resorting to alternative personal solutions by using the Very Small Aperture storehouse (VSAT) satellite systems, for long distance electronic communication. For short distances, the MDS (Metropolitan Digital run) system is often use.The problem here is that all the banks are trying to procure appropriate VSATs mugwump of one a nonher. In former(a) words, there is no collaboration among the banks in sourcing this very expensive technology and thereby providing a cost- incumbranceive solution to the problem. It would too be fair to say that Nigerian banks are generally imbued with an overly emulous mind -set, which tends to foreclose the benefits of synergy or collaboration in solving most of their common problems. 3. RESEARCH METHODOLOGYIn order to pass judgment the perceptions of banking customers in Nigeria with respect to the quality of banking work, a questionnaire be was conducted. A grab ingest technique was used to select the customers from the banks. tailfin commercial banks in Nigeria Wema Bank Plc, alliance Bank of Nigeria Plc, Omega Bank Plc, cooperative Bank Plc, and entry Bank Plc. were selected for this sampling on the basis that they have branches in almost all the declares in Nigeria and they control use of estimators in almost all their branches.The researchers visited the banks during working hours and the questionnaires were given to the customers as they visited the banks. A total of 500 questionnaires were distributed in this way. 260 questionnaires were returned to the researchers, a response rate of 52%. The survey instrument can be free-base in the Append ix. In addition, the researchers conducted personal inter sights with five bank managers and fifteen IT staff in order to gain an appreciation of what types of IT systems and electronic application run The electronic ledger on Information Systems in create Countries, http//www. jisdc. org EJISDC (2002) 10, 2, 1-8 3 were available in the selected banks. The responses were mensurable with a fivepoint Likert-type rating scale, where potently equal (SA) = 4 Agree (A) = 3 powerfully Disagree (SD) = 2 Disagree (D) = 1 and Neutral (N) = 0, while the scores f r o negative items were reversed. 4. RESULTS AND parole remand 1 shows the IT systems that are being used in the selected banks. Telephone, Facsimile, Local Area Network, ready reckoner system, MICR (Magnetic Ink Character Recognition), were used in all the banks.Also Wema, Omega and Access banks used Very Small Aperture entrepot (VSAT), electronic Funds Transfer (EFT), and wireless radiophone. The researchers were able to ide ntify IT devices available in the selected banks from personal interview conducted with the 5 branch managers and 15 IT staff in the banks. instrument panel 1 IT systems and electronic application service in the selected banks Types of IT systems Wema Omega Union cooperative Access Telephone X X X X X radiocommunication radiophone X X X Facsimile X X X X X Computer X X X X X Electronic Mail VSAT X X XLocal Area Network X X X X X MICR X X X X X EFT X X X 4. 1 Effect of IT on Banking serve The emergence of IT on an enquiry on a customers read of invoice, and run beded by the customers from the banks as perceived by the banks customers, are shown in carry over 2. come out of the 260 respondents, 86. 2% concur that IT was very back up the bank they substantiated, while 90. 8% agree that IT made the enquiry about the accede of their tarradiddles faster. Also, 83. 1% hold that IT had a smashing absolute impact on the serve rendered by the banks.The slosheds of 3. 12, 3. 29 and 3. 07 individually for the selected banks respondents confirm that IT has a cocksure imprint on the enquiry of customers state of composition and operate enjoyed by the customers from the selected banks. Generally, the sets of IT on the enquiry of the customers state of account and services enjoyed by the customers from the banks have an appreciable influence on any bank. The use of a LAN and data processor systems have ensured quick and remedyd services delivery to customers by the banks.But it may be important to state that the use and application of these electronic devices are hampered by the lack of infrastructural facilities like power add. 4. 2 do of IT on Customer function circuit board 3 shows the response of customers from the banks with respect to the effect of IT on customer services provision. active 66. 5% dis hold that IT had no effect on services rendered by the banks. Also 82. 7% concur that there is a choose to improve on the services rend ered by these banks. The means of 2. 77 and 2. 4 respectively confirmed that IT has personal effects on services rendered by these banks to their customers and about 83% of the respondents agreed that the banks need to improve on the The Electronic Journal on Information Systems in Developing Countries, http//www. ejisdc. org EJISDC (2002) 10, 2, 1-8 4 services rendered to the customers. This shows that the services the banks are crannying now are non the best they can offer to their customers and that the banks should improve on these services to their customers. turn off 2 do of IT on Banking Services disbelief SD IT/ reckoner is really help this 2. bank IT makes enquiry about the state 2. 3 of my account faster IT/computer has a great positive 2. 3 impact on the services rendered by this bank D 4. 6 N 6. 9 A 43. 9 SA 42. 3 blotto 3. 12 0 6. 9 36. 6 54. 2 3. 29 4. 6 10 37. 3 45. 8 3. 07 N 9. 7 A 18. 8 SA 5. 0 blotto 2. 77 10. 4 50. 4 32. 3 2. 94 Table 3 Effects of IT on Cu stomer Services Question SD D I take for grantedt think IT has any effect on 34. 6 31. 9 services rendered There is a need to improve the 0 6. 9 services rendered by this bank Table 4 exaltness and capability of services as perceived by the customers Question SD DN A SA think I enjoy prompt and effectual service 0 16. 2 9. 2 37. 7 36. 9 2. 93 delivery I was once delay in the bank 16. 5 31. 5 6. 9 32. 7 12. 4 2. 38 because the computer was down IT does not increase prompt and 43. 1 42. 7 4. 6 7. 3 2. 3 3. 17 expeditious service delivery 4. 3 Promptness and efficiency of services as perceived by the customers From Table 4, about 75% of the respondents agreed that they enjoyed prompt and efficient service delivery from the banks. The mean of 2. 93 shows that IT enables the banks to provide prompt and efficient services to their customers.Questions 3 and 7 (see Appendix) are similar, but the reaction of the respondents confirmed the conclusion higher up because about 85% of the respondents agreed that IT has increased prompt and efficient service delivery by the banks. Also, on the issue of delay due to computer down times, only 44. 9% of the respondents agreed that they were once delayed in the bank because the computer was down, though this might be due to the epileptic power supply and inefficient telecommunication infrastructure in Nigeria. The mean of 2. 93 confirmed that most of the time, customers go to the bank when computers are not down. 4. Influence of IT on musical accompaniment as perceived by the customers Table 5 gives responses on the influence of IT on patronage as perceived by the customers. 70% of respondents agreed that based on the efficiency and in effect(p)ness of services rendered, they could encourage their colleagues to condescend the banks they used. Also, 65. 8% of the customers agreed that the banks use of IT encourage them to patronize the banks they use. The means of 2. 47 and 2. 52 respectively show that IT encourages cus tomers to patronize the banks. The The Electronic Journal on Information Systems in Developing Countries, http//www. jisdc. org EJISDC (2002) 10, 2, 1-8 5 use of computers, telephone, VSAT, and EFT has contributed immensely to the growth of banking industry. In Nigeria presently, some banks are not make use of IT and those banks are being patronized by few customers, the majority of whom are illiterate and poor. This makes the employee turnover of these banks low. Table 5 Influence of IT on patronage as perceived by the customers Question SD D N A SA I can encourage my colleagues to 4. 6 5. 0 20. 4 47. 3 22. 7 patronize this bank IT/Computer encourages 2. 3 9. 6 22. 3 32. 7 33. 1 customers to patronize this bankMean 2. 47 2. 52 Table 6 Perception of customers on the ease of conducting banking transactions Question SD D N A SA Mean Saving or withdrawing cash is 21. 9 36. 9 7. 3 31. 2 2. 7 2. 63 time consuming IT eases banking transactions 2. 3 2. 3 9. 6 50. 0 35. 8 3. 10 4. 5 Perc eption of customers on the ease of banking transactions Table 6 in a higher place shows that 58. 8% of customers disagreed that saving and sezession of money is time consuming. Also, 85. 5% agreed that IT eases banking transactions. The means for questions 6 and 13 (see Appendix) are 2. 63 and 3. 00 respectively. The mean of 2. 3 for question 6 (see Appendix) shows that some respondents agreed that saving and withdrawal of money is time consuming condescension the use of IT in those banks. Table 7 Effects of IT on the fundamental interaction surrounded by cashiers and customers Question SD D N A SA IT has reduced the interaction 15. 0 30. 4 17. 7 27. 3 9. 6 between cashiers and customers Mean 2. 15 4. 6 Effects of IT on the interaction between cashiers and customers Table 7 shows that 36. 9% agreed with the view that IT has reduced the interaction between customers and cashiers, 17. 7% are indifferent to the question and 45. 4% disagreed with the view with a mean of 2. 15. 4. 7E ffects of IT on cashiers work The rates at which cashiers in the banks attend to their customers depend on the equipment available for the cashiers to work with. From Table 8, 83. 1% agreed that computer despatchs up cashiers work, while 10% disagree and 6. 9% are indifferent. The mean of 3. 12 confirmed that IT/Computer really affect the rates at which cashiers attend to their customers. Generally, the use of electronic devices like computer telephone, facsimile, etc. forget go a long way to increase the speed of the cashiers work. Table 8 Effects of IT on cashiers work Question SD Computers really speed up 2. 7 cashiers work D 7. N 6. 9 A 37. 3 SA 45. 8 The Electronic Journal on Information Systems in Developing Countries, http//www. ejisdc. org Mean 3. 12 EJISDC (2002) 10, 2, 1-8 6 4. 8 IT and banks productiveness From Table 9, 81. 5% agreed that the use of IT increases bank productivity in that with the use of IT, the bank can attend to a lot of customers since IT speeds u p cashiers work. The mean of 2. 98 shows that IT has a positive effect on the growth and productivity of the banks. There is no bank that can make use of one or combination of two or more of the IT systems listed in Table 1, which will not have effects on the productivity of the bank.Table 9 IT and the productivity of the bank Question SD D IT increases the banks productivity 0 4. 6 5. N 13. 8 A 37. 3 SA 44. 2 Mean 2. 98 CONCLUSION The study has dealt with the effects of IT as perceived by customers on selected commercial banks in Nigeria, which make use of IT in their operation. The study revealed that IT has appreciable positive effects on the bank productivity, cashiers work, banking transaction, bank patronage, bank services delivery, customers services, and bank services.These affect the growth of the banking industry in Nigeria positively because customers can now collect money from any branches of their bank. Also customers do not need to move about with vainglorious sums of money, and customers are being attended to within a short period of time. The study also revealed that telephones, computer systems, LANs, and Facsimile services are available in nearly all the banks making using of IT in Nigeria while WANs (Wide Area Network), Electronic level Transfer, and wireless phones are available in some of the banks. This conclusion confirms Alus (2002) claims on the IT devices available in Nigerian banks.Research has shown also that IT is really fate these banks, so other banks in Nigeria that are not making use of the IT are encouraged to do so. From the study, the major hindrance to the use of IT in the banking industry in Nigeria is inadequate galvanising power supply. voltaicity supply is not regular because of the limitation of the machine that is supply electrical energy to Nigeria. Furthermore, the Nigerian government is finding it difficult to equip the NEPA (National Electric Power Authority) while the demand for electrical energy is increa sing daily.Therefore, the situation will handle to worsen until the Nigerian government funds NEPA appropriately. So, for this nation to be effective in the use of IT in the banking industry and to make the banking industry grow in an appropriate way, there is a need for the Nigerian government to find a solution to the epileptic supply of electricity throughout the country, since NEPA is owned by Nigerian government and there is no private company in Nigeria that provides electricity. The Electronic Journal on Information Systems in Developing Countries, http//www. ejisdc. org EJISDC (2002) 10, 2, 1-8 6. 7 REFERENCES Alu, A.O. (2000) Effects of Information Technology on Customer Services in the Banking Industry in Nigeria, M. B. A. dissertation in Management and Accounting, Obafemi Awolowo University, Nigeria. Coombs, R. , Saviotti, P. and Walsh, V. (1987) Economics and expert Change, Macmillan London. Ige, O. (1995) Information Technology in a De-regulated Telecommunications Env ironment, Keynote address, INFOTECH 95. First International assemblage on Information Technology Management, Lagos, November 16-17. Levitt, T. (1992) The globalisation of Markets, in Transnational Management Text, Cases and Readings in Cross-Border Management.Richard D. Irwin. Smith, Adam (1776) The Wealth of Nations Ugwu, L. O. (1999) Assessment of Impacts of Information Technology on Selected Service Industries in South Western Nigeria, MSc. Thesis in technology Management, Obafemi Awolowo University, Nigeria. APPENDIX Dear Respondent, This questionnaire is knowing for a research work from the discussion section of Management &038 Accounting, OAU, Ife. Please, FILL IN conciliate information, all the information will be treated confidentially and the information will be used for this research work only. Thanks. Please tick or carry where appropriate.SECTION A 1. Sex A. MALE B. womanish 2. Age A. 18-25 ( ) B. 26-35 ( ) C. 36- 45 ( ) D. 46 &038 above ( ) 3. Educational qualification A. WASCE( ) B. OND/NCE( ) C. Bsc/BA( ) D. Msc/PhD( ) E. Others find . 4. For how long have you been using this bank? A. 0- 2yrs ( ) B. 3-5yrs ( ) C. 6- 8 ( ) D. 9 &038 above( ) 5. What type of account do you operate? A. Current( ) B. Savings( ) C. Others specify .. 6. My Account here is mainly for A. Business( ) B. Salary( ) C . Others specify 7. For how many hours do you spend on queue ? A.Less than1 ( ) B. 1-2 ( ) C. 3-4 ( ) D. 5 &038 above( ). The Electronic Journal on Information Systems in Developing Countries, http//www. ejisdc. org EJISDC (2002) 10, 2, 1-8 8 SECTION B powerfully Disagree 1. 13. Agree IT increases bank productivity 15. Neutral IT/Computer is really helping this bank I dont think IT has effect on the banks operation I enjoy prompt and efficient service delivery I will encourage my colleagues to patronize this bank IT does not increase prompt and efficient service delivery To let off or withdraw money is time consuming I was once delayed in the bank ecause the computer was down IT makes enquiry about the state of my account faster IT/computer has a great positive impact on the growth of this bank IT/Computer has reduced the interaction of the Cashiers with customers IT/Computer encourages customers to patronize this bank Computer really speed up cashiers work IT improves transactions 14. Disagree There is a need to improve the services rendered by this bank 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. The Electronic Journal on Information Systems in Developing Countries, http//www. ejisdc. org Strongly Agree