Don’t Make these Budgeting Mistakes as You Plan for 2020

It’s that time of year again – Q4 is in full swing and we’re all looking ahead to 2020. Of course, that means budgeting. IT and telecommunications likely play a large role in your business, keeping you connected internally and externally. Are you properly budgeting for the associated expenses?

6 IT Budgeting Mistakes You Need to Avoid

We’ve helped countless companies with their IT and telecommunications budgets. Here are some of the most common mistakes we see:

1. Not budgeting at all (or not taking it seriously)

You do strategically budget for IT and telecommunications, right? Okay, good, just making sure.

If you are spending too little, you may not be operating as efficiently as you could be. If you are spending too much, you may be missing out on growth opportunities in other business areas. IT and telecommunications can be one of your company’s largest investments and should be carefully analyzed each and every year.

2. Recycling the budget

Planning to simply take what you spent this year and transfer that number over to next year’s budget? Think again. Each year is different, especially when it comes to your business’ IT and telecommunications needs. Some years may be heavy investment years while others are depreciation years. New technologies may emerge that you’ll need to adapt to in order to stay ahead. You may add team members or departments.

Of course, you should take what you’ve spent in the past into account, but only as a guide. It’s best to take a look at the current landscape and your goals and treat each year independently from the last.

3. Budgeting only for the expected

A natural disaster, a security breach, a sudden system failure: you simply can’t prepare for absolutely everything. Handle an unexpected situation with minimal financial disruption by planning for it. Know that every year you’ll likely need to allocate funds towards something you didn’t see coming and work extra money into your budget for it.

4. DIYing the budget

Analyzing your company’s IT expenses probably isn’t your job . . . and it shouldn’t have to be. A trusted IT partner can educate you on what new technologies are coming in the new year, help you determine whether or not you’ll need any upgrades, look at where you are spending too little or too much, and more. They can work with you every step of the way to ensure you’re budgeting the right amount for the right things in order to meet your company’s objectives.

Furthermore, cybercriminals are getting more sophisticated by the day. By working with a managed security service provider (MSSP) who offers robust security options as part of their managed service offerings, you can feel confident that you’re covering everything, including cybersecurity, in your budget.

5. Thinking short-term

What is your business plan for next year? What about the next 5 years? 10? Take a look at your business goals and ensure you have an attainable IT plan in place to support these objectives. What new technologies will you need? Will you be growing your team? Adding additional service offerings? Whatever the case may be, it’s best to plan as far in advance as possible to avoid unexpected or last-minute costs.

6. Postponing investments

When budgeting, it’s easy to overlook investments that seem “unnecessary” such as technology upgrades, system, and software updates, or a revised backup and disaster recovery plan. There’s always next year, right? Unfortunately, when it comes to IT, that’s not really the case. You don’t want to wait for a system failure or disaster to occur to find out that these investments were actually extremely necessary. Planning ahead, and writing these line items into your budget, will set you up for long-term success.

Have you started to think about your 2020 budget yet? We can help. Contact Warwick today.