FinTech revolution: the impact of management information systems upon relative firm value and risk

The FinTech or ‘financial technology’ revolution has been gaining increasing interest as technologies are fundamentally changing the business of financial services. Consequently, financial technology is playing an increasingly important role in providing relative performance growth to firms. It is also well known that such relative performance can be observed through pairs trading investment. Therefore pairs trading have implications for understanding financial technology performance, yet the relationships between relative firm value and financial technology are not well understood. In this paper we investigate the impact of financial technology upon relative firm value in the banking sector. Firstly, using pairs trade data we show that financial technologies reveal differences in relative operational performance of firms, providing insight on the value of financial technologies. Secondly, we find that contribution of relative firm value growth from financial technologies is dependent on the specific business characteristics of the technology, such as the business application and activity type. Finally, we show that financial technologies impact the operational risk of firms and so firms need to take into account both the value and risk benefits in implementing new technological innovations. This paper will be of interest to academics and industry professionals

Proceedings of the 39th Hawaii International Conference on System Sciences- 2006 Systems Design, Process Performance and Economic Outcomes

Abstract. IT value remains a serious concern of management today, especially how it should be measured and how it is created. Although we have made significant progress at the firm and aggregate levels of analysis, process level analysis is still in its infancy, and there is a need for a systematic basis for identifying IT impacts. We provide such an approach by developing two models: a process performance model of how system characteristics enhance process output and quality, and an economic performance model linking process performance to the economic performance of the firm. We apply these models to global trade services in international banking. We obtained estimates for key variables in both models and general support for the approach. We interpret our results and discuss the merits of the process-level approach for the assessment of IT-reliant work systems

Impact of Grid Assimilation on Operational Agility in Turbulent Environments: An Empirical Investigation in the Financial Services Industry

Financial services providers are exposed to a highly turbulent environment that is characterized by an intense competition for the development of new financial products and the attraction of customers. Against this background, Grid technology assimilation can be assumed to be a potential strategic response to address fast changing market demands and to enhance the operational agility of business processes. This article presents the results of a quantitative field study conducted to analyze to what extent Grid assimilation impacts on the agility of business processes, as well as the role of environmental turbulence in the Grid assimilation process. The research model was validated based on 178 responses from senior IT decision makers of financial services providers in the U.S. that have already adopted Grid technology. The results from partial least squares analyses suggest that environmental turbulence significantly strengthens the relationship between Grid assimilation and operational agility