The Dollars & Sense of IT Budgeting
HELLO!
We’re the RoundTable Technology Team Here to share nonprofit expertise Joshua Peskay Dawn Gallery-Khan Karim Beldjilali
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ICE BREAKER / MOVING EXERCISE Let’s start by moving around
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The light at the end of the tunnel has been turned off due to budget cuts. ~ Anonymous
▫ Why Bother?
OUTLINE FOR TODAY:
▫What is measured, improves ▫More planning = More options
▫ Deconstructing the IT Budget
▫Types, Categories & Classes of Expenses
▫ Budget Considerations:
▫IT Lifecycle, Planning & Risk ▫On-going Costs ▫ROI
▫ Strategies for Reducing Costs ▫Grants & Fundraising ▫Crowdsourcing & Pro-Bono ▫Managed Service Providers ▫Cloud vs. On-site
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Exercises FOR TODAY:
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▫ Moving Survey ▫ IT Budget ▫ ROI & Funding ▫ Shark Tank
WHY BUDGET FOR IT?
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WHY BUDGET FOR IT?
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▫ IT is not “set it and forget it” ▫ IT is key to a high-functioning nonprofit’s operations ▫ Understanding how IT aligns with a nonprofit’s priorities is critical to budgeting ▫ Assessing risk and preparing for the unexpected helps reduce “surprise” expenditures ▫ Differentiate between mandatory and discretionary IT costs
WHY BUDGET FOR IT?
Better Planning More Options
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CLEAR BUDGETING Let’s look at the parts of a budgets to make informed planning decisions 10
Types IT EXPENSE COMPONENT MATRIX
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Categorie s
▫ Personnel ▫ Salaries ▫ Capital ▫ Benefits ▫ Operating ▫ Non-Personnel ▫ Project ▫ Hardware ▫ Software ▫ Subscriptions ▫ Services ▫ Warranties
Classes ▫ Run ▫ Optimize ▫ Innovate
EXPENSE TYPES
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▫ Personnel ▫Salaries ▫Benefits ▫ Non-Personnel ▫Hardware ▫Software ▫Subscriptions ▫Services ▫Warranties
EXPENSE CATEGORIES
▫ Capital
▫Hardware: PCs, Network, Telephony ▫Bulk Software License Purchases ▫Significant Repairs
▫ Operating
▫Subscriptions ▫Maintenance ▫Hardware / software support
▫ Projects
▫One-time efforts for specific objectives
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EXPENSE CLASSES
▫ Run
▫Spending that keeps the organization running at its current level of service
▫ Optimize
▫Projects and initiatives that improve organizational efficiencies and effectiveness ▫Optimize spending can reduce run costs
▫ Innovate
▫Investment in new capabilities, products or services
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BUDGET CONSIDERATION S Let’s look at the technology to make informed budgeting decisions 16
TECHNOLOGY LIFECYCLE
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▫ Hardware ▫Assets risk failing as they age ▫Consider the criticality of the asset and ease of replacement
Item
Low Risk
Mediu m Risk
High Risk
Server / Switch
<5 Yrs
5-7 Yrs
>7 Yrs
Desktop / Wi-Fi
<4 Yrs
4-5 Yrs
>5 Yrs
HARDWARE TOTAL COST OF OWNERSHIP
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▫ Purchase price is typically much less than 50% of the direct costs ▫ Direct costs ▫Setup ▫Support ▫Maintenance ▫ Indirect costs ▫Lost or reduced productivity because of downtime
TECHNOLOGY LIFECYCLE
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▫ Software ▫Costs are more predictable ▫Can include upgrade fees ▫Subscription models ▫ Assess continued use ▫Does it still meet your needs ▫End date for vendor support ▫Interoperability with other software
TECHNOLOGY LIFECYCLE
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▫ Services ▫Contract / subscription model ▫Platform maintenance varies ▫Reduced or donated costs ▫ Projects ▫Finite timeline & deliverable ▫Finding / minding the gap ▫Communications is primary
TECHNOLOGY PLANNING
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HIGH EXPENSES: PART 1 TRANSITIONS
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The Beginning
The End
The “Chasm” ▫ Assessment ▫ Planning ▫ Implementation ▫ Training ▫ Go-Live
Going Gracefully ▫ Troubleshooting ▫ Inefficiencies ▫ Operational Impact ▫ Next Steps / Iteration ▫ Transition planning
HIGH EXPENSES: PART 2 - RISKY BUSINESS
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Risks to Plan For
Risks to Mitigate
The “Hurricane Sandy” What-ifs ▫ Remote Working ▫ Business Continuity ▫ Disaster Recovery Plan ▫ Emergency Training
Remove / reduce single points of failure ▫ Cloud Systems ▫ Backups ▫ Redundancies ▫ Remote Working ▫ Documentation ▫ Cross-training
To grow, you must leave your comfort zone.
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Change Curve
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Exercise IT Budget
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ACCOUNTING FOR ON-GOING IT COSTS Getting your arms around true cost
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TRADITIONAL BUDGETING PROCESS
Assessment
Feedback
Documentation
Implement
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AGILE BUDGETING PROCESS
Assessment
Feedback
Documentation
Implement Iterate
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FREE & LOW-COST TECHNOLOGY
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Hardware
FREE & LOW-COST TECHNOLOGY
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Software
PRO-BONO
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Crowdsourcin g
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Technology Funders
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Hyde and Watson Booth Ferris Knight Foundation
Way to think about ROI...
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More Stuff
Way to think about ROI...
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Less Work
Way to think about ROI...
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Better Work
Way to think about ROI...
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Reduced Risk
ROI EXERCISE
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TIME TO FEED YOUR BUDGET TO THE SHARKS
CREDITS
Special thanks to all the people who made and released these awesome resources for free: ▫ NPCC for hosting and coordinating ▫ Donny Shimamoto of IntrapriseTechKnowlogies ▫ Presentation template by SlidesCarnival ▫ Photographs by Unsplash ▫ ROI for Workflow by IBM
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RoundTable Resources Resources
IT Budget Template ROI Worksheet Technology Funding for Nonprofits Project Management for Nonprofits webinar Tame Your Inbox webinar Merchant Advocates (credit card services audit)
Resources from Others
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ROI for Process Improvement (IBM) IT Budgeting for Nonprofits (Donny Shimamoto) ROI for Digital Investments (Capgemini Consulting) Nonprofit IT Staffing Report (NTEN)
THANK S
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