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Creatively Carving the IT Budget Pie

Effective Planning Can Turn an Obstacle into an Opportunity

By GREG PELLERIN

Greg Pellerin

Greg Pellerin

“The budget evolved from a management tool into an obstacle to management.”

Former U.S. Secretary of Defense Frank Carlucci was talking about government spending when he made this comment, but he may as well have been referring to those days leading up to the start of a new business budget year. It’s that time when executives go scrambling to either spend what’s going to be lost or, more than likely, find more money to fund an important project.

There is no shortage of priorities for most IT departments. Strategic initiatives, the need for infrastructure upgrades, and software-licensing mandates are a constant challenge. Yet, hiring freezes and the redirection of funding within an organization often make implementation difficult. In my opinion, the answer to those once-a-year budget woes can often be found in four areas: prioritization, funding, implementation, and monetization.

 

Prioritization

It seems simple, but you’d be surprised by how many times the cart is put before the horse.

Virtualizing desktops and networks is a major investment with a cost-saving upside, but unless a company has clearly defined its ‘bring-your-own-device’ policy, a VDI plan shouldn’t even be considered.

Moving the data center to accommodate growth? Carefully and objectively reviewing hyper-convergence and public cloud potential is critical, because the best time to implement any or part of this solution is during a data-center migration/upgrade.

Perhaps it’s time to get rid of that old PBX phone system and institute a truly unified communications approach. By their very nature, VoIP solutions are software-based and are meant to evolve as business priorities change. A new, unified communications platform with the latest videoconferencing, instant messaging, and speech-enablement capabilities may be overkill and a real budget buster (you can always add capabilities later on).

Prioritizing actual versus perceived needs is the better course of action.

 

Funding

Critical IT investments can often be made by simply finding creative ways to reduce or redeploy existing budgets. A telecom-expense-management audit (often funded by the savings it incurs) takes a look at existing wireline and wireless contracts and often reveals thousands of dollars, if not tens of thousands, in unnecessary broadband spending. One of our clients was being charged $10,000 a month for a high-speed connection to an office they had closed years before!

Sometimes you can save big time by simply getting your suppliers to pay. Companies like Microsoft set aside millions of dollars each year to supplement new technology assessments and investments. All you have to do is ask.

Implementation

Oftentimes, the high cost of implementing IT solutions can be borne by outsourcing or staff augmentation.

Can’t handle incremental project workload with existing staff? New technology requiring specific expertise, and spikes in workload as a result of short-term projects, can be handled less expensively — and, in many cases, more efficiently — by temporary personnel.

You don’t need to outsource the entire project, but management may be the most logical place to start. A project manager can attend and lead facilities and departmental meetings, coordinate and manage critical milestones, and, most importantly, train your staff to take over the role once he or she is gone.

By focusing internal resources on core business functions, training time is reduced without adding permanent overhead.

 

Monetization

Everyone want to make money off of their investments, yet IT departments often find this difficult to accomplish.

Do you have an internal engineering-services department that handles maintenance and repairs to critical technologies? Does your data center have excess capacity?  These are just two areas where organizations can find monetization opportunities, but unfortunately, they are two areas that often fail miserably.

Before launching any effort to monetize internal resources, be sure that senior management establishes priority protocols that allow those resources to respond to external client needs with the same level of urgency as internal requests. This will ensure the success of most monetization efforts and a way to fund other IT initiatives without breaking the budget.

The budget process has become a necessary evil in today’s competitive business  climate. Creative planning approaches can turn it from an obstacle into an opportunity.


Greg Pellerin is a 15-year veteran of the telecommunications and IT industries and a co-founder of VertitechIT, one of the fastest-growing business and healthcare IT networking and consulting firms in the country; (413) 268-1605; [email protected]

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