This chapter provides the background to the study, the statement of the problem, the study objectives, and research questions .The chapter also provides academic and policy justification of the study and the scope of the study and the limitation of the study is also provided the study is geared towards establishing the influence of integrated financial management systems on performance levels in government ministries, case of ministry of foreign affairs, Kenya.
1.1 Background Information
Information and Communication Technology (ICT) is as a result of computer science and telecommunication engineering merging. This has brought dramatic changes business transactions in terms of competition in the market place and spread has through globally. (Schneider 2011). Innovations and product idea in ICT led to the introduction of IFMIS. These systems have changed the way business is conducted not only for companies but also for governments. Innovations in ICT offer rich opportunities for governments to significantly improve the delivery of their services and to interact more openly with their constituents. (Hazlett and Hill, 2003).
With regards to government operations and frameworks, IFMIS connotes computerization of public financial management processes, from budget preparation and execution to accounting and reporting, with the usage of an integrated system for the purpose of financial management (Lianzuala and Khawlhring, 2008). The scope and functionality of an IFMIS vary from a basic general ledger accounting application to a comprehensive system covering budgeting, accounts receivable or payable, cash management, commitment control, debt and human resource management,(Rozner,2008).
1.1.1 Global Perspective of IFMIS
While ICT is used to transform the way in which governments offer their services, it should be acknowledged that a detailed business case for implementing the technology must be undertaken with emphasis on cultural change, greater degree of commitment, organizational structure and business processes (Liu and Hwang, 2003). Strejcek and Theil (2002) claim that many ICT projects initiated by governments fail because they are poorly coordinated and because agencies act too independently. Political will is crucial to this process. Chaffey, (2009) describes e-commerce as all electronically mediated information exchanges between an organization and its external stakeholders. That means e-commerce includes other activities, “such as businesses trading with other businesses and internal processes that companies use to support their buying, selling, hiring, planning, and other activities” (Schneider, 2011).
ICT is versatile globally due to the availability of adequate donors ‘resources, combined with very experienced international and local consultants; and a solid backing at the political level, which trickle down to the management level, with both political and management commitment being strong throughout the entire reform process (Rodin & Brown, 2008).
1.1.2 Kenya Perspective of IFMIS
In 1998 the Ministry of Finance developed in order to address the challenges that were earlier witnessed in business and finance transactions in government deployment usage and implementation of the system to line ministries started taking place in 2003. The system was Enterprise Resource Planning (ERP) software based on Oracle. Enterprise Resource planning software is an organization-wide application that integrates its operations through a centralized database which is accessed using a secure network. However, various changes were made to fit the system to the government processes.