How to Budget for IT in 2022
All organizations struggle to fit the puzzle pieces of their budgets together. When it comes to IT budgeting, there’s even more confusion.
Why?
Any companies big enough to have an on-staff IT team knows how it goes. The IT department is great at what they do, but they aren’t financiers. Company leadership, in contrast, is great putting budgets together, but doesn’t have the IT knowledge to know what to budget for.
IT budgeting gets a lot easier when both sides of the business plan together. Businesses that use a “make it fit” model to squeeze in IT expenses as they come up will only suffer. A business that plans a meaningful IT strategy and budget instead will leverage technology in a way that powers business growth.
Let’s start with a look at what an IT budget should achieve.
Do you use financial planning?
Look at IT spending like an investment in your organization. This is similar to how you look at contributions to your personal retirement account.
If you use financial planning in your personal life, you already have the right mindset to build an IT budget. Ask yourself:
- What are your company’s short-term goals?
- What are your company’s long-term goals?
Once you’re clear on those goals, get your IT department (or your managed service provider) on board to discuss what technology is required to reach those goals.
Whether or not you should or can invest the necessary dollars in required tech isn’t the question.
Depending on your current earnings and cash flow, what you do will ask is how much you can invest in technology at a time. This will determine the speed you reach in pursuit of your goals.
Budget for the Human Element
The human element is a factor that many organizations forget when budgeting for IT. Budgeting in 2022 will rely on this element even more with many employees still working remotely.
There are to sides to the human element:
- First, it’s important to budget to employees’ IT preferences whenever you can. If you provide company-paid phones and some employees prefer iPhones but others prefer Androids, the greater productivity on a preferred device will offset any difference in price.
- An IT budget should also include the costs of onboarding and training for the technology that employees will use.
What are your goals?
Do you want to…
- Run your business with the right technology?
- Grow your business with the right technology?
- Or transform your business with the right technology?
Depending on how quickly you can budget to reach your short- and long-term goals, you can use technology to run, grow or transform your business. Naturally, the faster you invest toward those goals, the more transformative that technology will be.
Not sure where your business falls? Reach out to us today to talk about your IT budget for 2022.