Hammering out an IT budget can be tedious and frustrating—but it’s also a prime opportunity to make strategic plans and set priorities for the year ahead. This ebook covers the basics and offers tips and best practices for building an effective budget with the least amount of stress.
From the ebook:
IT budgeting can range from a painful annual process to the actualization of a carefully crafted IT strategy and roadmap. For an IT executive who is uncomfortable with numbers or loathe to endure the justification process that accompanies budgeting, it can be a difficult exercise, and the temptation may be to simply tweak last year’s budget or to succumb to arbitrary cuts.
To help IT leaders endure the budgeting process—and to use it as a strategic tool to drive their priorities—we’ve assembled this guide. It should make budgeting less painful and help you understand how to use your budget as a planning and communication tool. As the saying goes, “You put your money where your mouth is,” and your budget ultimately puts company resources behind the plans you’ve been articulating through the year.
In the worst case, an IT budget is a wish list of funding for every conceivable project and technology that’s expected to be reduced, trimmed, and rejected. In some companies, a reasonable budget is developed and then doubled or tripled to try to “game” the budgeting process and garner what’s actually needed. Your approver, whether they’re in IT or from the finance side, is probably on to this game, has a general idea of what’s appropriate, and will likely impose increasingly draconian cuts as you respond with increasingly ridiculous increases.
Rather than an attempt to secure the maximum pile of cash, the budget should be regarded as a manifestation of your IT strategy. If you’ve been communicating a strategy of migrating infrastructure to the cloud and highlighting the operational savings, your budget should reflect those savings and use them as justification for increased project expenses elsewhere. In short, every line on the budget should tell a story that maps back to your IT strategy. If you’ve done a good job of communicating and sharing that strategy, it will shift the budgetary process to tweaking amounts rather than justifying whole categories of spending.