IT Budgeting for Non-Profits
I was excited and energized when I was asked to speak about “IT Budgeting for Non-Profits” as part of the Merrimack Valley Chamber of Commerce breakfast series earlier this month. A big passion of mine is discussing the changing way of technology and how to fully utilize IT within organizations, so I was thrilled to speak about this topic to a group of top executives and IT professionals.
During my presentation, I went over a few key facts about IT for non-profits. According to the NTEN Technology Staffing and Investment Report July 2014/2015, IT for non-profits is traditionally immature due a budget constraint. There is an average of one IT person per 28.3 employees and technology adoption is still statistically low. Leading organizations will have about three times more IT staff than struggling and are two times more likely to include IT in Strategic IT Planning.
As you know, IT has evolved tremendously in the last decade. Having a technology plan is no longer optional and it is imminent that your budget revolve around this IT strategy. For many organizations however, the budget for IT is relatively low and this is particularly true for non-profits. Having a low budget makes it dire for organizations to create a strategic IT plan and sync it with the budget.
Here are four major elements to consider when creating your IT budget:
- The Budget Process – Converting the business goals into actionable IT initiatives is the foundation of a strategic IT plan. Once this is completed, marry the plan with a budget. Key stakeholders and the leadership team should be involved in creating this budget and understand the importance of sticking to it. This budget should be managed by the IT Director or IT Steering Committee to make sure the IT investment plan is aligned tightly with the business strategic plan.
- An Annual Process – Going over the IT budget should be an annual process that should you start at least three months before the fiscal year. It is crucial that you document your budget so you can stick to your plan and make adjustments for the following year. It’s also crucial to plan for change, your IT budget will alter so leave room in the budget for unplanned expenses.
- Capital Expenses – When creating you budget, you must account for capital expenses. This includes hardware, software, networking such as PCs and laptops. Your budget should account for telecommunication expenses like your Internet, voice and data lines. Also employee training as well as security and compliance audits are becoming necessary within organizations.
- Operating Expenses - -Including operational expenses in your IT budget is a must. Cloud services, such as Office 365 for email and telecommunications are important are important operational expenses. Subscriptions should also an item in the budget as it’s important for employees to get information about best practices and research in similar fields. Security and compliance is a non-planned for expense but unfortunately is becoming a reality expense. Organizations must have security, that’s the bottom line.
These are four pillars to consider when creating your IT budget and strategic plan. If you don’t feel like you are getting the right support from your IT team or provider, then it’s time for a serious conversation.