In 1987, the emergency decree was lifted and Taiwan rapidly opened up. This move made it clear that the government supported a shift to an open market. As such, market deregulation flourished. Private enterprises emerged, and advances in digital technology and computer networks made once naturally-monopolistic industries become competitive. The role of Stated-owned Enterprises (SOEs) changed drastically. SOEs now had to compete with private companies and deal with the variability of a liberalized market. Global competitiveness has created many problems for the industrial sector. While the impact of restructuring on the industrial sector ahs been negative, its effect on the service sector has been altogether positive. Deregulation and market competition, especially in the areas of finance, telecommunications and public transportations, has led to increased GDP contribution and improved employment rates. Overall, the percentage of GDP Contribution from the service sector rose from 48.03% in 1987 to 68.55% in 2004. Furthermore, in 2004, the total number of employees in Taiwan had increased by over 1.6 million since 1987. Of this number, 94% of Taiwan's working people were from the service sector and a mere 6% from the industrial sector. This trend has led to the service sector becoming more significant as the major contributor to Taiwan's GDP and as the major employer. To illustrate the positive effects restructuring has had on Taiwan's industrial and service sectors and to demonstrate how these industries have transitioned from state-owned enterprises to competitive markets, two case studies will be presented. In particular, we will address how information technology (IT) has been used to increase performance and productivity leading to successful restructuring from traditional to modern business models.