10 Pro Tips for Pitching Your IT Budget
The success rate of pitching your IT budget depends on how well you prepare for the pitch. You might have lots of new projects you wish to pursue, but what happens if you don’t get approval?
The following 10 tips will help you secure a successful pitch.
1. Determine Board Expectations
The board’s budget expectations are a crucial factor that determines whether you’ll get what you’re asking for or not.
Those expectations depend on current company earnings (good earnings equal budget increases, while a slow year might mean cutbacks), overall economic climate, and the importance of your department within the company.
But most importantly it’s understanding what the board expects for the budget. How does the board want IT to facilitate business needs? Understand these expectations and you’re likely to formulate a budget that’s more successful.
2. Gather C-Suite Intel
The corporate level is your go-to source of relevant budget information before pitching your IT budget.
Corporate executives will have already set up a general budget for the upcoming period and you can use this as a guideline. It will tell you whether you can request an increase, if it’s better to wait and allow you to test the waters.
3. Align IT Priorities with Business Priorities
A dialogue with c-suite executives will also shed light on current business priorities – what’s the most crucial goal to accomplish – and you can tune the budget towards achieving that goal.
You’ll have a much easier time pitching your IT budget if your priorities are aligned with the overall business priorities.
Make it clear that your IT spending is in service of achieving long-term business goals.
4. Have a Strategy for Every Amount
If you’re looking for a 15% increase when pitching your IT budget, you can’t expect to get it approved if you don’t have a plan/strategy on what you will do with that budget. As much as you’d like a ‘buffer’ in your budget, be prepared to quantify where every amount goes, the board shouldn’t have to guess whether you will utilise these 15% in a good or bad way.
5. Treat the Budget Like Your Own Funds
Many professionals, not just IT managers, seem to have an easy time spending company money without a second thought. It’s not yours anyway, right?
This is the worst possible stance on it! You have to treat your budget exactly as if it were your own money and show responsibility.
Instead of just asking for more because you didn’t have enough in the last quarter, look for alternative approaches – is there a way to stretch the current budget so it will be enough? What are some areas where you can save?
6. No Need to Spend Everything
Are you spending every penny in your budget even if you don’t have to? Do you fear you will get less next time if the board sees that you can do well with less?
Fear of cuts doesn’t justify spending everything just for the sake of it. Show the board that you know what you’re doing with the money you have and are working hard to save wherever possible.
That way, when you ask for more, you’ll have developed more of an authority to justify it.
7. Gather Team Input
Your IT team will have firsthand experience on what they are spending on most, as well as why. Is there a particular department that constantly needs new hardware, or perhaps you’ve recently implemented an upgrade which is why you’ve spent more of your budget this year. Get information directly from the source and ask them about hardware, software, training, and what they think should have the highest priority and why.
8. Check Company-Wide
Conduct interviews and surveys, and invite the staff to offer suggestions and observations they had during different tasks and projects. Did they have a hard time accessing data because your data centres are not consolidated? Or perhaps they had issues with outdated software?
You will have to make difficult choices when determining priorities, but this way you’ll have a much better overview of what to address first.
9. Have a Backup Plan
You might not get approval for everything you requested, so before pitching your IT budget, determine what you can go without. Will you cut on everything – ongoing and project expenses – or will you cross off a project or two off the list?
10. Be Ready to Scale Down
Unforeseen circumstances can strike a business at any time, so make sure to have a plan in place in case you’re asked to reduce spending mid-year because of lower earnings or business specific issues.
Pitching your IT budget
Pitching your IT budget is the easy part, it’s the preparation before pitching that you should focus on. When you have data from all relevant sources – the board, your team, and company standings – you’ll have an easier time aligning your budget with company needs and getting approval.