So it’s time to prepare a budget for your IT department. Perhaps this is the first time to do it, or maybe it’s an annual task that you dread.
The main aim is to cover everything that is essential, while also avoiding any really expensive surprises in the mix.
Ideally you should begin planning your IT budget a good six months in advance of when it needs to be finalized.
It’s important that you consider the long-term needs of your organization that have been identified by other leaders in the company. Your leadership team should map out what they will need in terms of technology and support over the next year in order to deliver their projects and other priorities.
It’s also a good idea to look at what other businesses that are similar in size to yours are spending on information technology annually. When you need to justify the expenses to other leaders in your company you can show what is “normal” and also set expectations when others may think that the IT department can deliver over and above when the funding just isn’t there for that.
Comprehensively review last year’s budget and work out what you have that you can carry over and what you are going to need. Are there areas where money was wasted? Can you make savings? Can you reallocate and divert funds elsewhere? Track and review all of your assets. Are there things that are going to need replacing or upgrading within the next 12 months? Budgeting can sometimes feel like a big game of financial Tetris where you try to make everything fit.
This is also an opportunity to look at your wish list: is there anything you really want for your department that you’ve gone without until now? It can’t hurt to make a business case for it and to ask for funding, or to really look at your overall budget and cut things that aren’t essential to get your wish list items instead.
Also look at innovating and funding things that will help the IT department to do its job more easily. For example, consider investing in DeskAlerts to inform your employees during IT outages. This is a cost effective investment that more than pays for itself in the tine saved by preventing unnecessary calls to your IT help desk.
When you are creating your IT budget you should ensure that you allocate money for:
- General business needs.
- Specific project IT requirements.
- Routine maintenance of systems.
- Replacement costs of systems.
- Equipment upgrades.
- Licenses for hardware and software.
- Unexpected system failures.
- Support and maintenance.
- Hardware – including any ongoing hardware support and additional equipment that you plan on purchasing.
- Software – including any ongoing software contracts.
- Cloud services and data storage.
- Backup and disaster recovery.
- Internet and intranet hosting.
- In-house staff.
- Recruitment costs.
- Budget to offset any unforeseen emergency events.