IMPACT AND STRATEGIC UTILISATION OF INFORMATION TECHNOLOGY IN SINGAPORE FULL LICENCE BANKS

Abstract

Over the past two decades, the full licence commercial banks in Singapore have embarked on an ambitious computerisation programme. A survey of 14 such banks shows that they have achieved the conventional aspect of Information System (IS) planning, where the targets of Information Technology (IT) applications are in the transactional and the managerial decision-making areas. The high automation level observed in traditional banking activities and the numerous Decision Support Systems (DSS) used to support various levels of the managerial decision making hierarchy confirm this view. Currently, the full licence banks are pursuing the strategic perspective of IT, where strong emphasis is placed on the strategic criteria as compared to the efficiency criteria when evaluating the contribution of IT. IS planning is also more externally focused and stresses on the strategic and competitive uses of IT in banking. Porter's competitive framework, which provides a good insight into the strategic perspective of IS planning, is adapted in this study to examine the strategic impact of IT on the competitive banking industry, as well as the strategies that these banks can use to position themselves. The survey also notes that the significant contributions of IT are improvement of customer service, data integrity, contribution to better achievement of goals and missions, and support for the achievement of competitive advantage. The major problems concerning the strategic use of IT are related more to system inflexibility and rapid changes in technology.