Strategic Contributions of Information Technology: An Empirical Study of Atm Networks
25 Pages Posted: 31 Oct 2008
Date Written: March 1988
Abstract
This paper presents an empirical study of the strategic contributions of automated tellermachines (ATMs) to improving a bank branch's local deposit market share at the expense of itscompetitors. By extending previous models of deposit market share in branch banking to incorporateATM technology variables, we develop a tool to provide answers and insights on key questionsinvolving the evaluation of second order strategic impacts of information technology (IT)which have not previously been measured in this context. Our results suggest that a bank's ATMnetwork membership decision is crucial to its later success in enhancing deposit market share viadeployment of ATMs. However, we found little evidence that branch ATMs provide any competitiveleverage to increase a branch's local deposit share.
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