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Need to increase IT spend? Make a winning pitch

In opinion / By Howard Smith / 13 February 2018

Rare is the business where department heads are not under constant pressure to reduce costs. If you’re a CTO or IT director, the Key Responsibilities section of your job description probably contains something along the lines of ‘Managing the budget as agreed, identifying opportunities to make economies and giving regular updates and cost analysis.’

But what happens when unforeseen events occur or the business simply evolves in such a way that the resources at your disposal are insufficient?

Pitching for extra resource is tricky enough during the annual budgeting season, even more so mid-term.

So, you’ll need to put a compelling case for increased spending in front of your CEO and CFO.

My six point plan is:

Assess every department's IT needs

Speak with your counterparts in other departments. Are they properly resourced? How far ahead are they looking? If they want more hardware, software, technical support or training, are these requests realistic or affordable? Do you need to make a case to include them in your request for additional spend or recruitment?

Consider business-wide risks

Do a bit of scenario planning here. What will happen if you carry on as you are without making changes? Is the business equipped, for example, to cope with new and changing legislation such as GDPR? Could you respond to an unforeseen IT crisis? Are staff overworked and struggling with low morale? Assuming the business is chasing increased sales or new contracts, can IT as currently structured handle the increased workload? Ask yourself, too if you’re 100% happy with the existing security systems.

Structure the IT function to reflect the business

Take time to get under the bonnet of your organisation’s structure, financials, medium term goals and long term strategy. Use these insights along with your findings and conclusions from points 1 and 2 above to align the IT function with the business and estimate its future as well as current needs.

Define where you are vs where you want to be

You’ll now have zoned in on where your resource shortage lies and the damage it’s causing – or could cause. This in turn will give you some pointers as to how to address it. Options could include any or a combination of:

  • Hiring new permanent staff - Best suited where continuity and stability are critical, this will be cheaper than hiring freelancers. That said, you’ll still need to convince the C-suite that the new hire will benefit the business and that the need is long term. Link this back to the business strategy and, if appropriate, show how much more executive time a mid-level appointment could free up for high-level planning and leading.
  • Freelance IT contractors - Ideal for plugging short term gaps or meeting sporadic needs. You’ll pay more per day than for a permanent hire, but you’ll save on employer overheads and need only budget for the time you need.
  • Technology - If you can make productivity gains by investing in new technology or upgrading your existing systems, set this out clearly with costings, timescales and tangible benefits. This could be for the business generally or for department-specific tasks. Again, you may be able to argue that the outlay will release resource further up the executive value ladder.
  • Outsourcing - There are many great reasons to outsource some or all of your IT functions. Costs, of course, are a big driver as outsourcing reduces the need to invest in hardware, software, recruitment, training and the inevitable upgrades further down the line. It also removes any risk of making bad purchasing or recruiting decisions. Another reason is that the costs of outsourcing are much easier to predict than those associated with keeping everything in-house. Then, of course, there’s the sharper focus on your core objectives that I’ve already mentioned. And, finally, through your tender process (a subject I’ll be looking at next month), you - and your colleagues with a stake in IT – can work with providers to devise a bespoke package.

Create your pitch

You’ve seen the big picture, you understand the needs at department level, you know where the shortfalls lie and you’ve weighed up and costed the options. You’ve also assessed what may happen if you do nothing. Now it’s time to start preparing your pitch.

Set out your findings in this order and state why you’ve opted for the solutions you’re proposing. Include your analysis of the options you’ve rejected as this will show you’ve considered all possibilities and that you’re not wedded to any specific option per se.

Although this is an internal document, its purpose is to sell your vision. Use positive, simple language to emphasise solutions over problems and highlight what’s in it for the whole business, not just the IT department. Break up your text with visual aids, diagrams and charts to illustrate and reinforce your key points.

Don’t include all your data and line-by-line financial breakdowns in this initial document. Concentrate at this stage on winning support for your vision. That said, have the finer detail ready, in a presentable format, should anyone ask for it.

Finally, don’t talk solely about shortfalls. Look too, for opportunities. Maybe, your proposals could give your organisation a competitive advantage or pave the way to enter a new market? Always think about the wider business strategy and how you can further the bigger objectives.

Win the day – or play the long game

Hopefully, this approach to releasing extra resource will work first time round. However, don’t be too disappointed if it doesn’t. You’ll have positioned yourself as a strategic thinker and you’ll still have options. In the immediate term, see if there’s a compromise to be struck by settling for your second or third choice solutions. In the longer term, keep track of progress and seek a follow up meeting with the CEO and CFO in say, three months’ time. You never know, events during that period may bring them closer to your way of thinking.

Howard Smith

Howard Smith

Howard is a freelance writer for various companies and writes for the Nasstarian on a wide range of subjects.

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