How to build your tech budget for 2023
This is a guest post by Chrystal Taylor, head geek at SolarWinds
As the year comes to a close, discussions about next year’s financials and budgets are rising among business leadership. But with the global economy still in turmoil and fears of a downturn looming large, how can IT leaders budget effectively for the coming year? The task may feel daunting because we really never know what the future will hold, but if four major elements of IT costs are taken into consideration, a solid budget will result.
In the Asia-Pacific (APAC) region, an IDC survey found that 63% of CIOs would reduce their budgets going into next year. The focus is now on “keeping the lights on”. This caution stems from growing fears of a recession, concerns over rising prices, continuing supply chain disruptions, and fears over a recession. While IT spending in APAC held up well and grew 3.8% this year, the willingness to increase IT budgets is even more uncertain today and a decline is expected in 2023, according to IDC.
Against a difficult to predict 2023 backdrop, now is a good time to focus on critical future priorities, consider new solutions to provide long-term value, and further cement IT’s worth as an essential partner to the business.
The global pandemic has taught us the value of preparation. Below are four considerations to be at the top of mind for IT leaders and their teams when considering budgets as the increasingly uncertain new financial year looms.
Adapt to the language of business
Most IT leaders should already know this, but it’s worth repeating in this climate. Old rules still apply — aligning pitches or arguments to business priorities like profitability, bottom lines, and efficiency remains a surefire way to grab and hold attention. But also be mindful of emerging concerns: cyber security, data regulations, breaches, and other risk topics dominate boardroom conversations — and are worth the attention of savvy IT leaders.
Additionally, adopt a results-based approach when talking to top leadership: Focus on the technical “how” of a solution and explain its benefits to the business — like reduced licensing costs, improved customer satisfaction scores, or faster resolutions. This line of argument lands better with an audience concerned about rising costs and shorter return-on-investment (ROI) timeframes.
Extended visibility is paramount
Accelerated digital transformation, tool sprawl, and the remote workforce have caused IT complexity to spiral out of control rapidly. SolarWinds’ latest IT trends report shows IT teams are increasingly worried about the lack of visibility, with 55% of respondents stating they only have visibility into half their apps and infrastructure. This has rippling effects, from project delays to impacted returns on investment.
With every dollar being precious, this trend can’t continue. The imperative is clear: increase visibility across every endpoint device, cloud platform, and application, then build connections giving IT teams the data they need for a complete picture (and control) over every disparate or siloed system. Only then can they adopt a more proactive stance on performance issues, improve SLA compliance, and minimize downtimes that cost the business time, money, and reputation.
Don’t scrimp on monitoring and security
Last year saw a triple-digit increase in cyber attacks, a 68% jump in data breaches, and hourly downtime costs shattering the million-dollar barrier for 44% of leading enterprises. These headlines make a strong business case for heightened monitoring and more robust cyber security measures. Increasingly complex hybrid IT environments, tighter SLAs (service level agreements), and an expanding threat surface due to a growing remote workforce should seal the need for more significant budget allocations for monitoring and security in 2023.
With better monitoring and extended visibility, IT teams can also conduct meaningful assessments of their entire IT infrastructure. By looking at available network data, they can determine if pandemic-era solutions still meet the needs of the current workforce. Similarly, they can also identify business areas benefitting from greater automation or security, allowing IT teams to strategically allocate and maximize their IT budgets for a more significant long-term effect.
Pick your battles
IT leaders could do everything right and present the most convincing argument possible, but sometimes the answer might still be a disappointing ‘no.’ Don’t expend more time and energy pushing for an upgrade or new investment — move on. IT teams should identify areas where there is opportunity for consolidation, optimisation and automation, resulting in more significant ROI, lower costs, and improved performance.
This approach is sensible because IT budgets aren’t the only things shrinking. Most IT teams’ time, energy, and resources are at a deficit becuase of more demanding and expanding hybrid IT infrastructure. Forward-thinking leaders can’t go wrong when they prioritise upskilling or developing their teams because people are essential — whether they’re keeping a legacy system alive or supporting the implementation of a new solution.
An unwavering focus on building teams, strategic priorities, and speaking the language of business should prepare IT leaders and their teams for the year ahead. Whether it’s going to be a rocky ride or smooth sailing, the above considerations will be vital in ensuring the continued productivity and effectiveness of the IT team and the larger business they support daily.