One of the most immediate changes IT leaders faced in the wake of the Covid-19 pandemic was budgeting. Budgets were slashed and many CIOs and IT Directors were forced to make some tough decisions regarding how to spend their limited resources. Due to rising Cost of In-house IT, many companies, particularly larger corporations, had gotten into the habit of utilizing in-house business budgets which are designed to reflect spending and investment goals for the upcoming year.
A budget is often prepared for the coming year to help improve operating efficiency as it ensures spending is not done without any plan or guide. We cannot deny that the budgeting process is changing as we speak. The pandemic brought about many economic challenges for the world. As a result of this, IT budgeting is now forced to compete with other budgetary demands that are highly critical for the well-being of a company.This blog will discuss how IT budgeting has changed in the wake of the pandemic and how you can strategize your IT budgeting process in the most effective way.
For many IT departments, budgeting will always be a headache. When they struggle to forecast how much they need to spend on purchasing products and services, how can they possibly balance their budgets? In the midst of such uncertainty, one thing is certain: businesses need to find a way to make their IT budgeting process easier, as well as more cohesive.
1) Have an understanding of what you’re paying for
I know it sounds obvious, understanding the amount, you are paying for is essential for IT expense management. Today the way we purchase services has changed vastly. The main difference between 2008 and 2020 is that companies have more services to choose from and end users are much more tech-savvy. In today’s technology environment, IT spending is spread across many areas of business. Employees are in a hurry to use freemium solutions to mobilize. Sales has also acquired a cloud service that provides field workers with important customer information. Another group is currently using Unified Communication (UC) tool targeted at smaller groups. Today, IT costs are seen company-wide.Software licenses and services typically appear on expense reports and corporate credit cards. These outputs are coded as “IT,” “Other,” “Other,” or “Office Supplies.” For many providers, free trials are regular monthly invoices with automatic credit card payments. How does this affect your budget and how can you manage it? It is important to understand these costs, what they are, and how they are paid.
2) Inventory Evaluation
As in 2008, we need to evaluate the inventory of equipment and services. This can be more difficult than ever due to the large number of services available, easy to deploy, and easy to access.
Once you have established what you are paying for, it’s time to decide what your real needs for those services are. Determine if the service you originally purchased was intended to meet your short-term or long-term needs. Has your short-term free referral offer expired? Check if the cloud service is replicated elsewhere in your organization. Are employees still relying on mobile hotspots for internet access, even though they were originally intended for temporary use only?
Bottomline, no one could predict this pandemic, so it is impossible to budget an organization’s response to it. Assessing the impact on the situation and budget is an important step in moving forward.
3) Leveraging of Data
The main advantage of data collection, analysis, and adaptation is the ability to renegotiate contracts. Recently, providers have been open to considering contracts in the medium term. They want to keep your business especially in the midst of an economic crisis. Did the temporary dismissal and changes in sales incur a contractual penalty? Consider an approach for changing term contracts. We encourage you to change your monthly sales commitment. Identify the terms and conditions that need to be finalized to prepare for a future business crisis. This pandemic highlights the need to understand and resolve divine acts, business declines, and payment disputes.
4) Engage with Peers
The support of a professional technical advisor can positively support this recovery process. Technology consultants work with clients on a regular basis to solve complex IT problems. You have insights into the experience and implementation of your colleagues. It can prove worthwhile to take swift action that affects your budget. A good consultant can ask the right questions, identify problem areas, and provide key benchmark data that leads to the desired results. 2020 was a very disruptive era for all aspects of business. As in 2008, the positive financial recovery of IT is the result of understanding, assessing, adapting and thinking positively about budgets. Learn from the ups and downs of this time-it will make you worthy of future success!
The Best Advice for operating in a post pandemic world
As the world emerges from the depths of a pandemic, one of the best ways to keep your business safe is to take a proactive approach to security and backups. This will save money in the long run.
You may need to split a portion of your budget today to prepare for the unexpected, but this proactive approach will last longer than if you were involved in a ransomware attack, for example.
It’s actually much cheaper. If you need help setting up this proactive IT solution, contact CSG Technologies to create a bespoke proactive plan that fits your budget today.