The nexus between data analytics and firm performance

The increased access and availability of information technology solutions have brought structural shifts in traditional business models, processes, and activities worldwide. As a result, the innovative ways of doing business and practices have disrupted the traditional businesses and technologies. T...

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Autores principales:	Raazia Gul, Nazima Ellahi
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2021
Materias:	data analytics digitalization financial sector productivity financial performance Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/cc251af4332b4aeca1eb5b3aba65d57c
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spelling	oai:doaj.org-article:cc251af4332b4aeca1eb5b3aba65d57c2021-12-02T14:35:29ZThe nexus between data analytics and firm performance2331-197510.1080/23311975.2021.1923360https://doaj.org/article/cc251af4332b4aeca1eb5b3aba65d57c2021-01-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2021.1923360https://doaj.org/toc/2331-1975The increased access and availability of information technology solutions have brought structural shifts in traditional business models, processes, and activities worldwide. As a result, the innovative ways of doing business and practices have disrupted the traditional businesses and technologies. This study investigates the impact of investment in data analytics on the financial performance of banks in Pakistan. A sample of 32 banks including commercial and microfinance banks for 2010 to 2019 was selected. Random effect panel estimation and instrumental variable two-stage least square were employed to quantify the impact of data analytics on firm performance. The results indicate that investment in data analytics increases the productivity of banks by 10%. However, the impact of investment in DA on profitability measures including return on assets, return on equity, and net interest income was negative, reflecting the “profitability paradox.” In the current era of digitalization, the banks need to invest in innovative technologies which have analytical capabilities to remain competitive and sustainable.Raazia GulNazima EllahiTaylor & Francis Grouparticledata analyticsdigitalizationfinancial sectorproductivityfinancial performanceBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 8, Iss 1 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	data analytics digitalization financial sector productivity financial performance Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	data analytics digitalization financial sector productivity financial performance Business HF5001-6182 Management. Industrial management HD28-70 Raazia Gul Nazima Ellahi The nexus between data analytics and firm performance
description	The increased access and availability of information technology solutions have brought structural shifts in traditional business models, processes, and activities worldwide. As a result, the innovative ways of doing business and practices have disrupted the traditional businesses and technologies. This study investigates the impact of investment in data analytics on the financial performance of banks in Pakistan. A sample of 32 banks including commercial and microfinance banks for 2010 to 2019 was selected. Random effect panel estimation and instrumental variable two-stage least square were employed to quantify the impact of data analytics on firm performance. The results indicate that investment in data analytics increases the productivity of banks by 10%. However, the impact of investment in DA on profitability measures including return on assets, return on equity, and net interest income was negative, reflecting the “profitability paradox.” In the current era of digitalization, the banks need to invest in innovative technologies which have analytical capabilities to remain competitive and sustainable.
format	article
author	Raazia Gul Nazima Ellahi
author_facet	Raazia Gul Nazima Ellahi
author_sort	Raazia Gul
title	The nexus between data analytics and firm performance
title_short	The nexus between data analytics and firm performance
title_full	The nexus between data analytics and firm performance
title_fullStr	The nexus between data analytics and firm performance
title_full_unstemmed	The nexus between data analytics and firm performance
title_sort	nexus between data analytics and firm performance
publisher	Taylor & Francis Group
publishDate	2021
url	https://doaj.org/article/cc251af4332b4aeca1eb5b3aba65d57c
work_keys_str_mv	AT raaziagul thenexusbetweendataanalyticsandfirmperformance AT nazimaellahi thenexusbetweendataanalyticsandfirmperformance AT raaziagul nexusbetweendataanalyticsandfirmperformance AT nazimaellahi nexusbetweendataanalyticsandfirmperformance
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The nexus between data analytics and firm performance

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