Improving Integrated Financial Management Information Systems

Improving Integrated Financial Management Information Systems Led by expert Dr Carolyne Stanforth.

Donors are widely backing the adoption of Integrated Financial Management Information Systems (IFMIS) projects in developing countries, but all too often success is hampered, or made difficult to determine, by the lack of clear targets at the design and implementation stage, according to expert Dr Carolyne Stanforth.

The world’s most developed nations began introducing integrated computerised government financial systems back in the 1980s. Since then, IFMIS projects have become a standard part of donor cooperation with developing countries undertaking public finance management (PFM) reform programmes - and earning considerable criticism along the way.

Often costing many millions of Euros to implement, and millions more in licence agreements and maintenance, IFMIS are a costly part of the development assistance effort, both for donors and in particular for partner countries.

“There is a big story out there that these information systems fail to deliver what they’re meant to deliver,” said Dr Stanforth from the Centre for Development Informatics at the UK’s University of Manchester. However, there’s also no agreement on the benchmarks for a successful IFMIS implementation so analysis and evaluation studies “can give very different results of what success and failure represents.”

To listen to the interview with Dr Stanforth in full, click here.

Carolyne Stanforth Audio

Dr Stanforth's powerpoint presentation is attached to this article for download.

Dr Stanforth, who made the comments at a recent presentation at EuropeAid headquarters, would like to see more structured analysis of past experiences with IFMIS implementation to ensure that future projects are continually being improved and shaped to the needs of partner countries. And, importantly, experts and donors should take the long-view in making judgements on programmes that can span decades. Indeed, expectations from such systems are often too high and it is easy to forget that these are just powerful tools to support a reform process, rather than a substitute for sustainable change.

Favouring IFMIS implementation is closely linked to the expansion of the ‘Good Governance’ principles of development assistance. IFMIS is linked to enabling greater accountability and transparency of government systems and budgeting.

But by focusing on this link, says Dr Stanforth, donors are taking too narrow a focus. Donor investment in IFMIS could, she says, offer great potential for the development of local ICT industries. While participants from the floor raised the point that donors could consider investing in open-source IFMIS modules that would free poorer countries from expensive license agreements with software vendors.

Furthermore, in their haste to implement, donors and partner governments have sometimes overlooked the basic necessities needed to support such a government-wide system. IFMIS will never work without a reliable electricity supply, computer literate operators or a national telecommunications infrastructure, among others. Yet many African partners, lacking just such basics, have been encouraged to take up standard packaged IFMIS solutions.

Dr Stanforth also shared copies of her paper, ‘Understanding e-Government Project Trajectories from an Actor-Network Perspective’. Written with Professor Richard Heeks, also from the Centre for Development Informatics, the paper puts this long-term perspective into practice with a ten-year view of the IFMIS development and PFM reform in Sri Lanka.

“What it shows is there’s no snapshot of success, or of failure – it’s a long and winding path. And we have to follow that path,” said Dr Stanforth. “We can’t say: ‘At this point, the project has proven to be a failure’, ‘At this point it’s a success’. It changes. And that’s what we would like to put over – that we should look at these IFMIS projects, which are part of long-term PFM reform programmes, over a much longer period.”

To read about related issues, visit the IMF's PFM blog: http://blog-pfm.imf.org/