The Effects of Information Technology Capabilities on Financial Performance: A Review on the Banking and Financial Sector
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https://doi.org/10.5281/zenodo.14311285Keywords:
Information Technology Capabilities, Financial Performance, Resource-Based ApproachAbstract
This study examines the effects of information technology (IT) capabilities on financial performance within the resource-based approach (RBV) framework. Specifically, the effects of technical infrastructure and human support dimensions of IT capabilities on capital adequacy ratio (CAR), return on assets (ROA), return on equity (ROE) and average return on assets (AROA) in the Turkish financial sector are analysed. Data obtained from 122 respondents working in the information technology departments of 11 banks and finance institutions were used in the study. The results reveal that technical IT capabilities have a positive and significant effect on CAR, but have a limited effect on other performance indicators. Human support, on the other hand, has no direct significant effect on financial indicators. However, a positive correlation was observed between technical IT capability and human support, suggesting that human support may have indirect effects. Furthermore, it is emphasised that IT makes significant contributions in areas such as customer satisfaction, operational efficiency and strategic flexibility. While the study emphasises the strategic importance of IT investments in the financial sector and the impact of technical infrastructure on performance, it draws attention to the need for more investment in human capital development. The findings of the study suggest that the effects on financial performance may vary depending on contextual factors and it would be useful to examine these relationships in detail with longer-term analyses. In conclusion, it is argued that IT capabilities should be considered not only as technological infrastructure but also as a strategic tool for organisational transformation.
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