Build an IT Budget
Effective IT budgets are more than a spreadsheet. They tell a story.
- IT cost pressure is fueled by negative sentiment; IT can be perceived as a high cost that does not deliver value.
- Budgetary approval is difficult because finance executives have a limited understanding of IT and use a different vocabulary.
- Detailed budgets must be constructed in a way that is transparent, but too much detail results in complexity that is confusing.
Our Advice
Critical Insight
An effective IT budget tells the story of how IT is going to deliver value to the business.
- Make the business your partner to understand their future needs.
- Know how much money you’ll need and the value you’re going to deliver.
- Communication matters; present clearly and credibly.
- Help the organization make the right decisions by explaining the implications of its choices.
Impact and Result
- Knowing the initiatives business units will propose allows you to get a head start on forecasting IT costs.
- Presell ideas. Quick face-to-face chats about how a new initiative could benefit the organization can go a long way.
- Do not pad key innovation project budgets; building the case for approval is difficult enough as is.
- Forecasting operating costs requires an accurate view of historical costs and an understanding of how business changes will affect IT costs.
- Anticipate the questions that will be asked; discretionary projects are often criticized and challenged. Think about areas that people will focus on, do research, and be ready to respond intelligently.
- An IT department can’t squeeze dollars out of rocks. Tie cost reductions to service reductions and deferred projects.
Build an IT Budget Research & Tools
Start here – read the Executive Brief
Read our concise Executive Brief to find out how to build a budget that demonstrates value delivery.
1. Plan
Plan for success.
2. Build
Build the budget.
3. Sell
Sell the budget.
Member Testimonials
After each Info-Tech experience, we ask our members to quantify the real-time savings, monetary impact, and project improvements our research helped them achieve. See our top member experiences for this blueprint and what our clients have to say.
8.7/10
Overall Impact
$2,000
Average $ Saved
5
Average Days Saved
Client
Experience
Impact
$ Saved
Days Saved
Rhode Island Medical Imaging
Guided Implementation
9/10
N/A
N/A
CEVA France SASU
Guided Implementation
8/10
N/A
N/A
Bin Shihon Group Company Limited
Guided Implementation
9/10
$2,000
5
City of Lynnwood
Guided Implementation
10/10
N/A
5
Lungenliga Schweiz
Guided Implementation
10/10
$23,500
5
Prince George's Community College
Guided Implementation
10/10
N/A
N/A
Hanon Systems
Guided Implementation
9/10
$63,667
20
NEPC, LLC
Guided Implementation
7/10
N/A
N/A
The Chicago Transit Authority
Guided Implementation
10/10
N/A
10
City Of Redmond
Guided Implementation
7/10
N/A
N/A
Somerset Capital Group
Guided Implementation
9/10
$7,640
3
HR Green, Inc.
Guided Implementation
6/10
N/A
N/A
Armed Forces Benefit Association
Guided Implementation
8/10
N/A
N/A
Old Republic National Title Insurance Company
Guided Implementation
8/10
N/A
N/A
Saab AB
Guided Implementation
6/10
N/A
2
Australian Wool Innovation
Guided Implementation
7/10
N/A
N/A
Dimension Data Group Services US Inc
Guided Implementation
10/10
N/A
5
Cost & Budget Management
Get the budget you need to enable IT to deliver to its full potential.
This course makes up part of the Financial Management Certificate.
- Course Modules: 8
- Estimated Completion Time: 2-3 hours
- Featured Analysts:
- David Yackness, Sr. Research Director, CIO Practice
- Gord Harrison, SVP of Research and Advisory
Onsite Workshop: Build an IT Budget
Onsite workshops offer an easy way to accelerate your project. If you are unable to do the project yourself, and a Guided Implementation isn't enough, we offer low-cost onsite delivery of our project workshops. We take you through every phase of your project and ensure that you have a roadmap in place to complete your project successfully.
Module 1: Plan
The Purpose
- Definition of IT budgeting.
- Recognition of the benefits of better budgeting.
- Understanding the risks of budgeting.
- Understanding the challenges of budgeting.
- Preparing for IT budgeting.
- Getting the right people in the room.
- Understanding budget mechanics.
- Establishing a clear budget target.
Key Benefits Achieved
- Understand how better budgeting can help your IT department.
- Understand the risks of poor budgeting.
- Identify budgeting challenges.
- Understand what business units are planning to do.
- Successfully pre-sell ideas and get support for IT initiatives.
- Assemble a budgeting team and make sure resources are available for consult.
- Determine your budgeting target.
- Understand budgeting process.
Activities
Outputs
Discuss how IT budgeting works for your organization.
- Identified budgeting pain points experienced by your IT department.
Brainstorm budgeting goals and understand what your IT department would do with a limitless budget.
- Identified budgeting pain points experienced by your IT department.
Identify organizational goals and discuss impacts on IT budget.
- A list of all goals that the IT budget would meet with a limitless budget.
Prioritize meeting the goals of finance and other business units.
- A prioritized list of key goals that the IT budget must meet.
Module 2: Build
The Purpose
- Forecast capital costs.
- Understand best practices for capital budgeting.
- Forecast operating costs.
- Understand best practices for operating budgeting.
Key Benefits Achieved
- Accurate budgets for the capital costs of innovation, maintenance, and business projects.
- An understanding of best practices for capital budgeting.
Activities
Outputs
Identify key projects.
- A list of all projects that may launch this fiscal year.
Forecast capital costs.
- Accurate capital cost forecasts that are classified into various categories.
Forecast operating costs.
- Accurate operating cost forecasts that account for inflation, changing labor costs, changing vendor prices, and changing service levels.
Module 3: Sell
The Purpose
- Ensure budget includes required information.
- Validate and fix anomalies.
- Share your budget internally.
- Construct a budget presentation.
- Sell your financial budget.
- Build your budgeting people, process, and technology capabilities.
Key Benefits Achieved
- Ensure all required information is included.
- Identify and fix errors.
- Adjust assumptions to yield greater accuracy.
- Build a compelling budget presentation.
- Build a revised budget presentation.
- Practice the presentation to improve delivery.
- Find additional cost savings opportunities to suggest in the event of revision.
- Build budgeting capabilities through improving human capital, processes, and IT financial management technology.
Activities
Outputs
Play devil’s advocate: take turns critiquing the budget.
- A completed financial budget with accurate and defensible operating and capital cost projections.
Adjust the budget to tighten assumptions and correct errors.
- A completed financial budget with accurate and defensible operating and capital cost projections.
Build the budget presentation.
- A completed budget slide show that is compelling and concise.
Mock presentations: practice the budget presentation.
- A well-rehearsed and compelling budget presentation.
Identify budgeting activities your IT department needs to stop doing, continue doing, and start doing.
- A list of budgeting activities that your IT department needs to start doing, stop doing, and continue doing.
About Info-Tech
Info-Tech Research Group is the world’s fastest-growing information technology research and advisory company, proudly serving over 30,000 IT professionals.
We produce unbiased and highly relevant research to help CIOs and IT leaders make strategic, timely, and well-informed decisions. We partner closely with IT teams to provide everything they need, from actionable tools to analyst guidance, ensuring they deliver measurable results for their organizations.
What Is a Blueprint?
A blueprint is designed to be a roadmap, containing a methodology and the tools and templates you need to solve your IT problems.
Each blueprint can be accompanied by a Guided Implementation that provides you access to our world-class analysts to help you get through the project.
Need Extra Help?
Speak With An Analyst
Get the help you need in this 3-phase advisory process. You'll receive 3 touchpoints with our researchers, all included in your membership.
Guided Implementation #1 - Plan
- Call #1 - Plan the budget.
Guided Implementation #2 - Build
- Call #1 - Build the budget.
Guided Implementation #3 - Sell
- Call #1 - Sell the budget.
Contributors
- Ken Russell, Partner, Fortium Partners
- Andre Robillard, Head of IT & Administration, Dairy Farmers of Ontario
