The IT budgeting process is an annual tradition for most businesses and helps IT staff and business owners come together to plot out their IT spend over the next 12 months. To get some perspective (and some advice) on this process, my colleague Michele Crockett and I spoke with some IT budgeting experts at eTek Global. Michele Crockett discusses budgeting on the IT side of the house in her IT Pro Perspectives column. I’ll focus more on the business side of the discussion in this month’s Business Technology Perspectives.
Cindi Reding is the former CIO of Penton Media and is currently the vice president of business development at eTek. Reding mentions that IT departments and business leaders would be well-served by working closely together during the budgeting process, mainly to ensure that both IT and business needs are being met. “When business leaders start making IT decisions without the input of IT staff, it really can be a recipe for disaster,” says Reding. “Both IT and management need to avoid having IT go down one track and business stakeholders going down another.”
Reding stresses that the right working conditions really need to be set at the top of the company, with senior leadership committed to making sure that business leaders and IT work together. Getting the executive team involved and active in pushing for cooperation between IT and other groups can reap financial benefits by avoiding costly mistakes, particularly when a new IT platform or service is deployed that doesn’t meet the needs of the business, or doesn’t integrate well with existing IT systems.
“Another thing that business leaders can do to help the process along is to not get distracted by bright and shiny objects,” Reding says. “I’ve heard of several cases where a senior executive read something about a new IT technology or product while reading a newspaper or magazine during a plane flight, then encouraged the IT department to adopt the technology without knowing enough about the technical ramifications of adopting it.”
On the IT side of the house, Reding says that IT pros would be well-served by fully understanding the business needs of the company during the budgeting process, and to focus on providing solutions that are truly a benefit for the business. “IT departments have to demonstrate the benefits those new IT purchases will bring to the company,” Reding says. “IT departments really need to make sure that they’re not being seen as just a cost center to the rest of the company.”
Reding has some additional suggestions for ensuring a smooth IT budgeting process:
Invest in training. Business leaders should be open to additional funds for training IT staff in the use of the latest products and technologies. Technologies like virtualization and cloud computing can have positive financial results for the companies that adopt them, but only if the IT staff has been effectively trained in how to deploy, manage, and secure them.
Conduct proof-of-concept and deployment tests. For more complex product and platform deployments, work with vendors to create proof of concepts that show how the adoption of new technology may work with an existing IT infrastructure. This approach can help avoid costly deployment problems and help get the most out of limited IT budgets. Many IT professionals have tales to tell about costly deployments of new tools or services that were reversed due to incompatibilities with legacy systems or hidden requirements, so proof of concepts and test deployments can help you avoid costly (and potentially career-ending) mistakes.
Do you have any suggestions for how IT and business leaders can work together during the IT budgeting process? Pass along your suggestions to [email protected] or send a Tweet to my attention on Twitter @jeffjames3.