How startups should plan for their IT Budget



As IT professionals of all stripes look to 2013, IT-based budgetary planning stares back with some challenging realities. The big rub for many IT managers is that major cuts in funding create some significant problems for IT spending. The good news is that 2013 will not bring the doom and gloom that the past several years have. According to a recent survey by ComputerWorld, 43 percent of respondents reported an increase in IT budgetary spending. When compared to just 36 percent the year prior, this is a significant spike in budget increases. On top of that, 64 percent of respondents indicated their organization would make major IT purchases over the next 12 months.

What this can mean for startups is how important a budget plan can be to get the most out of their 2013 IT budgets. By understanding exactly what goals are set for both the short and long term, startups can embrace new ideas for a more efficient IT department.

The Art of Cautious Optimism

The fact that IT departments are a little more willing to spend money on IT resources doesn’t mean it’s time to go out and upgrade your entire infrastructure. IT departments are in an interesting spot. Some analysts warn that IT funds should be planned and allocated cautiously. This allows organizations of all sizes to be prepared for economic improvement and economic disasters. In other words, the future is bright, but proceed with caution. This is certainly nothing new to any startup company. In order to operate and maintain and effective budget, it is important that startups first understand their needs before making the step to purchase.

New Technology Adoption

Looking ahead, allocating IT funds will mean embracing cost effective technology. While this idea may seem counterintuitive – new technology purchase and implementation has traditionally meant higher spending – new companies have recently come out of the woodwork to solve the ever growing IT budget crisis. In short, adopting cost-effective IT solutions is proving to be the smartest move for IT departments clinging to their money and resources for dear life. It’s also becoming easier and easier to acquire this technology, which is great news for startups.

New Tech to Keep an Eye On

·       Virtualization – There has been a lot of talk of virtualization in IT circles. Proponents of virtualization tech laud it as the complete answer to all of the IT industry’s inefficiency problems. Others believe it’s just a fad. The reality is those virtualized environments simplify and reduce complex IT processes that bog down networks and IT workflow. Startups operating on few dollars and even less time can benefit from this technology greatly without a large IT department.

·       Cloud Servers – High-powered servers in a datacenter environment are responsible for anywhere from 1 to 1.5 percent of the world’s power usage, depending on whom you ask. Make no mistake, electrical costs play into the IT budget as a whole. This is particularly true for eco-minded companies looking to reduce their carbon footprint. According to a recent study by the Carbon Disclosure Project, IT companies can save upwards of $12 billion by 2020.

·       Flash Storage – They myth behind flash storage is that it is just as expensive as it is good. The truth is that traditional hard disk storage is on its way out, though, thanks to manufacturing techniques that make flash storage affordable. Hard drives are slow, clunky and unreliable. On top of that, flash storage prices have been steadily coming down since about 2003. New technology companies are developing affordable, scalable and stable flash storage arrays that will transform the way IT departments access and manage data. It allows IT professionals to access critical infrastructural data and manage secure backups quickly and efficiently. For companies with tight space and little time, flash storage can be your ticket to a much more efficient solution.

For any organization, planning IT budgets is and will always be a complicated process. Emotions will run high. People will push technology they’re passionate about. Others will shoot that technology down. The key here is that as you gather with your team to have these hard budget conversations, you should move towards technology that will make your company more efficient and stable as a whole while keeping costs to a minimum. Anything beyond that won’t help in the long run.

About the author: Dawn Altnam lives and works in the Midwest, and she enjoys following the business tech world. After furthering her education, she has spent some time researching her interests and blogging of her discoveries often.


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