Underfunded in IT? Success is still in reach.
If your organization is like most, you proposed an IT budget for the year based on historical spending and the need to close some serious gaps. And what was approved was a fraction of that number.
So now what do you do?
How do you plan for success knowing some challenges will have to remain underfunded? How do you cultivate a forward-thinking mindset when ongoing gaps are likely to frustrate your team and business partners?
Here are a few strategies to help you set yourself up for success.
1. Communicate clear priorities
Clear priorities are essential as your team starts the year. Before kicking off any new work:
Be sure you and your team understand what your organization is striving to achieve in the new fiscal year. Make sure any questions are answered.
Ensure you have FAST objectives that align to your organization’s overall business goals.
Acknowledge that things will change throughout the year, but hold yourself accountable to communicating well about shifting priorities. Clarity and timeliness are key to success.
Disseminate priorities in writing (either via email or your company web portal), so everyone has access. And make the priority list consumable – if everything is a priority, then nothing is a priority.
Bucket initiatives under high-level priorities. For example, “Reduce operating costs by 10%” should be a priority that has other activities listed under it. And everyone in your organization should be able to identify the priority they’re advancing no matter what work they’re doing.
2. Deliver highest value items early
Learn to be highly strategic about how you apportion your spending. Your IT budget should be a map of what matters most to your business. Any funding that can’t be linked back to overall business objectives or proven to have a near- or long-term increase on revenue should be cut.
When setting your budget, remember that things move and change quickly. Businesses are subject to market fluctuations, fierce competition and quickly evolving technologies. Any of these factors can affect your organization’s financials and cause mid-year budget reductions in order to stay on track. Keep this in mind when allocating budget dollars, and consciously plan to spend wisely throughout the year.
Activities that can be deferred should be scheduled for Q3 or Q4, in case you need to scale back your spending in the latter half of the year. Backloading your project plan with lower-priority items can be a life-saver when budgets have to be cut due to a downturn in profits. It also gives you the flexibility to act when other, more-valuable opportunities come up mid-year.
The same can be said for keeping your spending diverse. Don’t dump a ton of money into one target all at once. Tackle the highest priority activities first – those most likely to effect change – and then spread your spending throughout the year on activities that address your targets from different angles. This will help you better control your spending, give you greater flexibility to redistribute funds if objectives are met early, and make it easier to see which tactics are most effective.
3. Be transparent
Establish a baseline understanding of workload and priorities with your business partners at the start of every fiscal year, and refer back to it when necessary. Transparency about how the project portfolio fuels the business objectives will make prioritization decisions more effective. And having a baseline will help facilitate change conversations as the year progresses and new opportunities arise. For example, having a business colleague say, “I see we have [project X] coming up in September, but there’s a new opportunity that I think would better deliver that value,” sets up a much better conversation than, “Can you add [project Y] to your list?”
4. Encourage a value-based mindset
As always, encourage your team to focus on looking for ways to deliver higher value.
If someone has an idea for improving a process or a recommendation for using new technology, challenge them to present it in a way that can justify the cost and show appropriate return on investment. By having team members take ownership of linking the benefits to the financials, you’ll shift their thinking to a value-based conversation. When they can show you how redirecting funds will save money and still deliver the necessary objectives, you’ll have a viable basis for deeper conversation.
5. Schedule time for spring-cleaning
Don’t ignore aging assets. Doing so can inflate your costs unnecessarily. The most common argument I hear for pushing off maintenance is that it takes time and attention away from “more valuable” work. What’s really meant is “new” work. But existing assets that function well are a foundation for exploring new opportunities.
Don’t wait until a major failure disrupts your whole schedule and eats into your budget. Plan a maintenance project for evaluating your asset inventory and determining near- and long-term investment. Annually taking stock of your operational assets is just good hygiene. Like annual trips to the dentist, it can help you avoid a costly future write-down or emergency replacement.
How cShell can help
Some disciplined planning now will go a long way in securing your success throughout the year. Lay the foundation for your best fiscal year yet with a simple toolset:
Balanced, clear priorities that are tied to real objectives
Ability to respond to new opportunities
Transparency in planning and reporting
A value-based approach to change
Dedicated time for maintenance
If you’re struggling with any of these points or other challenges, our team of experienced IT leaders can help. Whether your commitments outweigh your budget, you need to find a way to self-fund innovation, or you just want an objective, C-level perspective on next year’s plan, our consultants can put their decades of experience to work solving your most pressing IT challenges.
We are available for hourly, on-demand consulting as needed, or for longer-term engagements. Contact us for a free consultation.