15 Strategic Ways IT Leaders Can Meet Company Objectives On A Limited Budget

There’s no question that technology initiatives can be expensive. Still, even with wide-ranging responsibilities and ambitious initiatives, most tech teams have to work within a limited budget. Tech leaders must carefully prioritize where funds will be spent, cutting back where possible and making the most of every dollar.

If this sounds like your IT department, you may be wondering how to budget appropriately while ensuring your company can still meet its objectives. To help, 15 members of Forbes Technology Council share their best strategic approaches to wise IT budgeting.

1. Align with where the company is right now.

CIOs need to be aligned with where the company is at a certain point in time. Sometimes efficiency is the call of the day (think professional services), and you are required to deliver value at the lowest cost possible. Other times, when margins are sound and hyper-growth is needed, effectiveness is top of mind, and speed of execution is all that matters. You generally get more flexibility with your spending then. - Labhesh Patel, Jumio Corp.

2. Take a look at overall goals.

Understanding the business roadmap, goals and revenue drivers is key to budgeting. Having that understanding helps to prioritize IT initiatives that are required immediately, in the short term and in the long term. This will help in defining resource, tool and technology needs and assist with appropriate budgeting. - Selva Pandian, DemandBlue

3. Create categories for your tech initiatives.

When creating your annual IT budget, categorize your initiatives as “revenue-generating,” “cost efficiencies” and “strategic imperatives.” This process will provide better insight for your business leaders and CFO. - Mark Schlesinger, Broadridge Financial Solutions

4. Assess where your team is spending most of their time.

With IT organizations spending the majority of their budgets on operations, it’s a good idea to periodically take a look at where your resources are spending time and effort. For instance, if manual provisioning is causing a delay in delivering resources to app teams, it might be time to invest in tools such as self-service IT to automate that process. - Jeff Kukowski, CloudBolt

5. Develop an ROI forecast.

Forecasting ROI for projects is crucial for working within a limited budget. By analyzing what tasks will yield the most productivity, one can allocate funds accordingly. Through this, companies will be able to meet their objectives in a timely and efficient manner. - Ashwini Choudhary, Recogni

6. Evaluate projects for impact, needed skills and alignment to strategy.

IT portfolio optimization is key to IT budgeting strategy. Along with zero-based budgeting, leadership should evaluate projects for business impact (cost of opportunity loss), skills (internal and external), and alignment to tech strategy. An enterprise should develop a cloud-first enterprise architecture model, and each project should use the EA toolkit for re-use and faster time to market. - Gaurav Aggarwal, Avanade Inc.

7. Always start with a business question.

Every IT project must begin by answering a fundamental business question. Will this project generate more revenue? Does this align with our company strategy? Will we increase our profit? When building the team, look for specialists focused not only on productivity but reliability. - Vaclav Vincalek, Future Infinitive

8. Prioritize based on risks and opportunities.

We all have finite budgets. It comes down to prioritization. What are the biggest risks or opportunities facing your company that would result from tech disruptions? Which investments will have the biggest impact? Ensure you are addressing short-term, mid-term and long-term investments. - David Vasko, Rockwell Automation Inc.

9. Assign a dollar value to each initiative.

Every initiative must be quantified in terms of its dollar value to the business. If you are always working on the highest-dollar-value projects, then you will always be positioned to maximize your business’ ability to achieve its objectives. - Tim Mitrovich, Artisan

10. Thoroughly assess potential outcomes.

When the development teams review their roadmap, ensure that these points are covered for each outcome: What happens if we don’t do this? What is the desired customer-facing outcome? What is the customer value for the outcome? What is the expected revenue or intangible benefit? Can we deliver this outcome quickly and iterate with customer feedback? Who are our development customer partners? - Gavin McMurdo, IStreamPlanet

11. Decide whether it’s better to build or to buy.

A great way to keep within budget for an IT department is to look at a list of your initiatives, identify the ones you want to accomplish and then make the decision to build or to buy. It can be more cost-effective at times to license a tool rather than build it in-house. It is important to see which tasks you need to build in-house—focus resources there and license the others. - Richard Kahn, Anura Solutions, LLC

12. Regularly review service agreements.

Have standing review cycles for services, especially telecom. Be very mindful of evergreen (auto renewal) clauses and cancellation notice requirements. Always be willing to negotiate and ask for better pricing—no matter what the company is. The end-of-quarter/end-of-vendor fiscal year is still the best time to get the best price if you have the resources and decision-making ability. - Thomas Polk, Midwest Eye Consultants, P.C.

13. Borrow from another department.

Unlike the U.S. Congress, most organizations have limited resources to complete IT initiatives. One strategic approach I have successfully used when budgeting for my security initiatives is to borrow from another department. IT and security initiatives tend to impact and benefit most organizational functions, so it makes sense to get those functions to factor in IT in their annual budget plans. - Bob Fabien Zinga, Directly, Inc./U.S. Navy Reserve

14. Hire a project planner.

The best way to budget for your IT team is to know exactly how many employees and resources you need. Start by hiring a project planner to put down the groundwork for your idea. Once you have the outline, you can make changes and revise it with the planner. When you’re done working out the details, you’ll have an accurate assessment of your finances so you don’t over-hire or overspend. - Thomas Griffin, OptinMonster

15. Be sure your budget includes a reserve fund.

Set aside some funds as a reserve that you can use when unforeseen IT costs come up or when you need to deliver unexpected IT projects. The reserve should be sufficient for you to feel comfortable running your IT operations but not so large that it ties up budget dollars that could be used to speed up deliverables. - Adi Ekshtain, Amaryllis Payment Solutions

Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives.