Our Guide To IT Budgeting
Budgeting for your business is never easy. One of the hardest aspects to budget for is your IT strategy and requirements. Whether you base it on projects, annually or quarterly, it can seem impossible to know how to budget when you must manage costs and prepare for unexpected situations.
However, when IT budgeting is crafted correctly, it can serve as a useful and influential roadmap for the future of the business and the strategy you are taking. Your budget can not only be the plan of finances but can be how you communicate where you want your technology strategy to be and how it can help the organisation as a whole.
A good IT budget will not only help you to prepare for the costs of the project or year but will also help you to set your priorities, so you know what to aim for and what is vital for your business. Not only does the budget help the IT department, but it also helps line managers in other departments. They can see and input the activities that lie ahead and help your IT plans to be supported across the company.
So, how do you start to prepare your IT budget?
How to prepare your IT budget
Firstly, the organisation needs to decide how best to allocate the IT budget. Some organisations want to assign an IT budget to each department and use a chargeback system. For some businesses, this can work, for others, it can be too complicated and challenging to instigate and work effectively. Either way, the IT department itself will need its own budget for day-to-day maintenance.
It is essential to begin your budget so that it provides a level of detail that builds a substantial case for approval but also doesn’t require micro-management. It needs to be flexible but still be a driving force behind your technology plan.
Secondly, you need to include the vital aspects of your IT budget.
Eight essentials to include in your IT budget
It is likely that you will need to upgrade outdated software and hardware and it is best to be prepared for the cost of this.
While some IT staff costs may be covered through the HR budget, you may need to incorporate staff into your IT budget whether you are expanding the team, promoting, increasing training or purchasing new equipment for the team to use.
Software can sometimes seem like an unnecessary expense, but software can help to make staff more efficient and productive, which can, therefore, cut costs and boosts profits for the overall organisation. Regarding software budgeting, always run a cost/benefit analysis. Remember, you don’t have to spend your entire budget just because you have allocated a cost.
The use of cloud technology continues to increase, and your business needs to prepare for it. Whether you expand into more cloud-based solutions, require more storage or need to strengthen your cloud security systems, this will take a chunk of your budget.
5. Mobile technology
Handsets quickly become outdated, and data plans increase rapidly. You need to account for increasing spend whether this is for new employees, upgrades for all staff or incidents when devices are lost, stolen or broken. As well the devices and data, you may need to also account for applications that enhance security such as mobile device management.
The IT department has considerable responsibility for maintaining cybersecurity across the whole organisation. As well as strengthening systems internally, the IT department will need to deliver regular training to ensure staff remain complaint with IT policies and do all they can to support cybersecurity for the business.
Your budget will need to account for a backup solution, whether you need data back-up to a variety of locations or upgrading your own backup hardware. Within this you may also need a back-up for internet connection should your chosen solution fail, and you need to get everyone back online quickly.
Every IT budget should declare a proportion of the budget for disaster planning. There could be many aspects that go wrong, from broken hardware to data compromises or server issues. Whatever aspects that you manage within the IT department make sure to dedicate a proportion to covering any disasters that may occur.
While it can be stressful to make sure every pound is allocated correctly, it is important to remember that fluctuations will happen, and you need to prepare to be flexible. Always consider your budget as a work in progress and try to tweak it where you need to so that your strategy remains on track.
If you need advice on IT budgeting or are looking to upgrade your technology solutions for cost-saving, security and efficiency, then get in touch with Cyan Solutions to find out how we can help.