When preparing a department budget, every IT manager must ensure that it is an accurate reflection of business goals, technology needs and economic realities. When presenting the budget for consideration, sponsorship and approval, IT managers must also be prepared to explain and justify that budget to ensure that all expense issues are clearly defined, and realistic service expectations are set. Read on for more.
Before you prepare your departmental budget, you must have a thorough and accurate understanding of all budget related goals. In all likelihood, these goals will have been set for you by company management, and will depend in large part upon current business circumstances, economic conditions, and the role that IT plays within the overall organization. As such, you must be fully aware of your budgetary marching orders, which will likely encompass three realities:
Once you are aware of your budgeting "realities", you can begin the process of identifying related priorities, which will shape and refine actual budget results.
In order to prepare a realistic IT budget, you must have a solid grasp on business priorities.Based on business type, current conditions and circumstances, likely business priorities will likely include any or all of the following:
The final step in this budget planning process is to align IT priorities with business priorities, aligning technology spending, IT services and related projects with established business goals (all as part of the IT management vision). As you begin this alignment process, you first need to look at your budget as a whole in terms of overall goals and management directives.
Business priorities may not always be clear, and if you are not sure, ask. You can interview managers, conduct surveys, or take advantage of staff observations made in the course of projects and support activities. It will be difficult, if not impossible, to make difficult budget choices, if you do not have a good understanding of the business needs and priorities.
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