A question that seems to come up a lot lately with clients, in some form or fashion, is “How should I properly budget for IT expenditures?” While this is a great question, there are a lot of variables that determine the answer, so we can’t provide a “one-size-fits-all,” simple answer. However, below are some general guidelines that should help.
Hardware & Software Refreshes
No one likes the cost of a network infrastructure, workstation or server upgrade, but it IS necessary approximately once every 3 to 4 years. PC’s and servers older than that tend to run slow, crash frequently and generally become more expensive to fix and support than to replace. Therefore, your budget should include an IT refresh of all equipment every 3-4 years to be on the safe side.
There is no “set it and forget it” when it comes to IT support & maintenance. With cyber criminals becoming more sophisticated and aggressive, you MUST constantly monitor and update your network and systems against cyber-attacks, malware, data loss, etc. Our Managed IT Support programs are built to provide predictable costs for your ongoing maintenance & support needs and security.
Another expense you must account for is backing up your data to an offsite location (often called “cloud backup, business continuity or disaster recovery”). Since all businesses generate MORE data year after year, the backup will grow as will the costs. Start by assessing the growth of your data over the last couple of years to uncover a trend. From there, forecast those additional expenses going forward at the same rate (don’t expect this to stay static year after year).
More and more organizations are leveraging the cloud to support their day to day operations. Whether it be Office 365, Google Apps or perhaps a file sharing service like Dropbox or Sharefile these services are an important part of your operating budget for technology. These expenses vary in cost based on the requirements of your organization, data set size, number of employees and add-ons you may need.
Another factor for your IT budget is upgrading software, line of business applications, CRM systems and accounting packages that can no longer support your growing organization. As your organization grows, systems, processes and data become more complex requiring more sophisticated (and often more expensive) software and systems. Make sure you are looking ahead year upon year to see this coming and to properly budget for it. There’s no “magic” formula for this because the timing and cost of your upgrade is unique to your organization, situation and what you are trying to accomplish.
As you prepare your budgets for the upcoming year we encourage you to talk with your Customer Success Manager who can provide estimated costs on projects, hardware refreshes and services as needed.