Abstract:
Many organizational leaders and strategy scholars would agree that the ability
to effectively manage information within the firm has become critically
important because it may provide a basis for gaining a competitive advantage.
Many business people invest large amount of funds for information
technology to improve the performance of the organization. Performance is
the main area of measuring success of the organizations. Many researchers
have shown the effect of information technology on the financial performance
of organization by finding the relationship among information technology and
the return on investment, growth in sales, return on equity and on assets. The
objective of this research is to find the relationship between investment of IT
and firm performance of the manufacturing organizations. According to this
research independent variables are Investment of IT on Total annual sales,
Investment of IT on Total assets and Investment of IT on Total investments.
Dependent variable is Return on assets (Weill, 1992).Secondary evidence is
used for this research. Seven years of historical data on IT investment and
performance were collected using Annual reports of CSE website .In the
recent past, researchers have shown conflicting results regarding the returns to
IT investment .Some researchers posit that the equivocal results of IT
investment are due to inconsistent measurement of firm performance and
investment (Roberts, et al., 2004).Multiple regression analysis and correlation
analysis technique were used to analyze the variables and data. The
importance of this research is to gain more knowledge about IT and its effect
of the organizations.
