Why an IT Budget is so Important

Updated: Apr 27

If you ever wondered if you should budget for Information Technology (IT) services on a yearly basis the answer is, YES. With IT services and acronyms being tossed around faster than you can google them, it makes it hard to make the right decision for your business. The misconception I have heard over the years is that only enterprise class companies need to perform this task. What I have learned and seen over my career is that SMB’s can greatly benefit from performing this task also. With the new year and new decade at our doorstep it is not too late to get one created.

Define what you want to include in your IT budget.

This step is the first one to tackle because it can be quick and helps generate the budgetary list of items. I recommend not spending more than 30 minutes on this task at first. Once you have defined what items to include remember to include the frequency in which they are invoiced to you. This task can morph into an entire day but to start let’s try and keep it simple.

Create a spreadsheet, add to it and share it!

That's correct, start adding the services, maintenance agreements, licensing and hardware (if you choose to budget for this) to the spreadsheet. Set your desired frequency (monthly is preferred) and voila. Once you have everything entered, I always recommend sharing this with your financial team (internal, external or both).

What do I do with my IT budget?

The first thing I usually do when I create my IT budget is add a line item for miscellaneous. I do this because things come up throughout the year that I could not foresee. I typically utilize miscellaneous to help implement or test new technologies that I discover throughout the year. I mostly see SMB’s use this category to implement some experimental new functionality or feature. Once all team members have had a chance to review, I then recommend reviewing it with your managed service provider (MSP). This shows your MSP that managing expenditures does not mean compromising on security, being proactive or productivity.

Having a fixed monthly expenditure for managed support services which include managed security services is an absolute in business today. Managing all aspects of technology requires understanding, knowledge and grace.

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