Since we are heading into a new year it is appropriate to discuss IT Budget for 2010. I read an interesting article in CFO Magazine that suggests you should be able to cut 9% to 11% of your budget: “How to Save 11% of Your IT Spend” by David McCann.
The essence of the article is that by modifying last year’s budget IT spends 10% more than they would if they did a from scratch green field approach. This includes the cost associated with the additional time to do a budget from scratch. The article does point out that there are diminishing returns if you do this every year so it suggests breaking the budget into 12 segments and doing a different segment every quarter creating a 3 year cycle.
Creating a budget from scratch does help for all budgeting – not just IT. We have been successful cutting costs dramatically by revisiting expenses with a fresh perspective. There is nothing like a challenging economy to motivate companies to examine costs.
Here is the article “How to Save 11% of Your IT Spend” by David McCann: