An effective IT budget can help you to meet your business goals while avoiding surprises that can come from poor planning. IT might not be your area of expertise, but you can apply your organizational skills to develop a budget that is suited to your needs.
One of the best ways to start thinking about your budget is to learn about the most common and most damaging mistakes that can be made.
Delaying Software Upgrades or Replacements
Many business owners make the mistake of delaying upgrades for just one more year. You may have even considered doing this within your own business. Costs for hardware, software, and service upgrades can be significant. However, the costs of not upgrading could turn out to be more difficult for your business to absorb.
- When you delay hardware upgrades, you risk failures that kill productivity and compromise your business.
- When you delay software upgrades, you could find that your business becomes less effective compared to the competition.
- When you delay service upgrades, you will eventually reach a point where your solutions are no longer fit for purpose.
If your business is growing, then your IT solutions need to grow along with it. Start by auditing your IT assets, determine which ones are most in need of upgrade or replacement, and prioritize your budget accordingly.
Failing to Invest in Training
A lack of training is one of the biggest IT security risks faced by businesses today. Inadequate training can also decrease efficiency and employee satisfaction. It’s important to continually assess your training needs and budget for training sessions, sometimes with external professionals.
Training will be particularly important if you are migrating to new hardware, software suites, or cloud technology solutions.
Don’t make the mistake of ignoring training in next year’s budget. Evaluate your needs today and plan ahead. Any investment you make in training will be returned in the form of more efficient daily operations with fewer security risks and productivity declines.
Miscalculating Your Cloud Expenses
There’s a major push in all businesses to move more services and storage systems to the cloud. There are countless benefits to moving away from self-owned assets. You’ll reduce expenses from procurement and maintenance, and you could even cut down your energy usage by hosting fewer solutions on site.
However, for all the savings that the cloud can provide, it also comes with new expenses.
If your company deals with large datasets, whether they’re accounting files, customer records, general backups, or even media like audio and video, you’ll need to have enough internet bandwidth to efficiently move your data to the cloud and access it when you need it. If your current network and connection to your ISP isn’t capable enough, then you’ll need to invest in upgrades.
Cloud solutions could even decrease productivity in some cases. Remote staff who work from unstable wireless connections may find cloud applications to be slow and unresponsive. You may need to consider 5G device upgrades if there’s a network in your area. Data usage will also increase, so you’ll spend more to keep remote staff connected.
Cloud solutions can make your business leaner, more efficient, and more agile, but you need to consider the underlying costs that aren’t always obvious.
Neglecting Your Disaster Recovery (DR) Plan
Malware attacks, virus infections, system failures, natural disasters, and accidental data loss could all cripple your business if you don’t have a plan for recovery. Don’t make the mistake of leaving DR planning out of your budget. There are numerous investments that can be made to ensure that you always have contingency.
A new backup system, transitioning essential services to the cloud and remote servers, or moving staff to portable devices are all examples of measures that can ensure business continuity when the unexpected occurs.
It may also be necessary to budget for disaster recovery consulting to help develop an efficient and scalable solution moving forward.
Rolling Over Last Year’s Budget Without an Audit
Too many business owners and executives make the mistake of simply rolling over an IT budget from one year to the next. Doing this can seriously impact performance and growth.
IT needs are rarely the same from year to year. You must develop a system where you follow a cycle of investment and depreciation. During an investment year, you spend on upgrades, maintenance, and capability expansions. During a depreciation year, your budget will be focused on core maintenance, with emergency funds allocated for unexpected costs.
You might not need to rotate every year. A depreciation period could last for two or even three years depending on the nature of your business and the systems that you run.
All businesses go through cycles of upgrades and procurement, followed by a gradual decline in IT solutions efficiency. By working this organic cycle into your budget, you will never be caught off guard.
Every mistake in IT budget planning can be avoided if you know what to look for. If you need assistance determining your technology needs for the year ahead, managed IT consulting will help.