Question

Q. Discuss the IT Budgeting practices that deliver value. Why of the practices do you consider to be the most important and why?

Answer 1

IT budgeting practices are the resources and funds allocated for certain practices which are an inevitable part of IT practices. It can range from certain ongoing expenses like Staff remuneration, hardware leasing or buying, software licenses, subscriptions and maintenance contracts. Certain IT practices that deliver value are :

• Budget needs to be prepared well in advance.
• Before few months when the budget is due, last year's budget is reviewed and current expenses need to be compared so as to look for possible cost reductions.
• Budget needs to be bifurcated under various subheadings like Software, Hardware, Staffing Requirements, Ongoing Expenses and Project Expenses.
• Appropriate communications and approvals is to be taken well in advance in order to avoid any last minute hiccups.
• Budget should be reviewed thoroughly so as to avoid any possible harms it causes to the collaborating partners.

As cost reduction is the crux of all the organizations in order to generate higher level of profits, so reviewing of the last year's budget and comparing with the current expenses, so as to look for possible cost reductions is the most important practice. It would help in analysing which undue cost is incurred in IT budgeting and how can it be reduced. It would help in reducing the possible cost incurred by the organization and raise the profit generated.