For a few months now everyone has been talking about the state of the economy, specifically about how bad it is, and the “R” word is even being tossed around like a raw egg in an egg toss contest: no one wants to catch it, but no one wants to drop it either!
It is vitally important, as you make strategic and budgeting decisions on IT outlays based on the current economic state, that you keep in mind three key points.
1. IT expenditures are not as voluntary as you may think.
When looking for areas to cut costs, you may be tempted to put your IT outlays on hold, scale them back, or eliminate initiatives altogether. It’s important that the impact of these decisions be weighed thoroughly. Generally, most IT initiatives come about out of a need or desire to accomplish at least one of three things: generate revenue, save time, or save money. In a tight economy, each of these three goals becomes much more critical. Therefore, it is imperative that you look at these initiatives carefully, so as not to axe from your budget a project that might in effect maximize your success potential in the current market state. Also, IT is such an integral part of running an efficient business, that you simply cannot cut IT expenditures in some areas without it having a negative impact on productivity. With a tight economy, productivity and efficiency are critical to success.
2. Extending the life cycle of technology increases risk factors, plan accordingly.
If you need to extend the life cycle of systems to trim some of the IT budget, backups and disaster recovery planning becomes even more vitally important. I just wrapped up a major upgrade project for an accountant after a RAID controller failure five days before tax deadline. In the fall we weighed the options of upgrading then, or to wait until after tax deadline. The existing server was in good working order, so we opted to wait. We discussed in that meeting beefing up the disaster recovery plan to have three layers of backup instead of two. This decision was critical in that all three layers of protection were used to recover data when the failure occurred. As a result we had 100% data recovery, and the accounting office met their deadlines. Please make sure that, if you have to extend any life cycles for IT systems, you discuss with your IT provider the impact of doing so, and be prepared to spend a little to hedge against the increased risk of attempting to save more money down the road.
3. Include your IT Provider in budget discussions.
Your IT consultant or provider can help you make good decisions regarding technology planning and initiatives, and can recommend good alternatives if you need to shift gears. Many companies try to plan their IT strategies alone, and then bring in their provider or consultant later to implement what they want to do. A good consultant with enough experience can help you create an IT budget and strategy that meets company objectives, while understanding the market conditions you are operating in. He or she can help to convert your objectives to working plans, and to make your IT expenditures add value to the organization. Many will consult for free, especially for long-standing clients, knowing that they will generate income in the implementation process. If your IT provider is included in the discussion of company objectives, it will help in ensuring that your IT dollars are spent much more wisely.
If you have a need to bring in an IT consultant to discuss strategic planning and company objectives, feel free to contact ForthPhaze Technology today.