2 Discussions, 1 Case Study

Discussion 2:

Post 1:

IT Financing

Every organization struggles with IT budgeting, and the reason is that most of the information technology teams are not familiar with the process that they should use in the budgeting process, and the finance team is not well aware of the IT process (Abel-Smith, 2018).  Therefore, the tea that is selected to deal with financing different departments in an organization should consider financing each department since they play a vital role in the environment. They should bear in mind that spending their budget on IT is like they are funding the future of the organization. Before financing, they should consider analyzing their customers, whether the short terms ones or the long terms.

The financial planners in an organization should consider every client in their organization, whether the client is a long term or a short term. It forms the central security before the organization (McKeen, & Smith, 2015). Therefore, if the department is not well-financed, then they will lack enough capital that they require to develop and set on the most secure strategies that they will use to protect the organization against the hackers. Excellent financing must consider each client in the organization since each client requires different facilities and products. Therefore, finance officers should make proper arrangements and overlook each client and the services they need where the services are long term or short term.

In conclusion, IT financing is important since it ensures that all the departments are well protected and connected. Without the connection, then the different departments in the organization will lack the proper communication that is required to jeep the processes running.

 

 

References

Abel-Smith, B. (2018). An introduction to health: policy, planning and financing. Routledge.

 McKeen, J. D., & Smith, H. A. (2015). IT strategy: Issues and practices (3rd ed

Response 1 in APA format with atleast 2 references.

Post 2:

IT Budgeting

COLLAPSE

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Gray, P. (2018) defined IT budgeting as “an IT budget is a wish list of funding for every conceivable project and technology that’s expected to be reduced, trimmed, and rejected.” In general people who propose the IT budget generally propose more than what is estimated to be on the safer side but the business who approve the budget are aware of such practices in IT. There are no fixed practices to defining an IT budget but below are some of the IT budgeting practices that can help

Appoint an IT finance specialist

            McKeen, J.D., & Smith, H.A (2015) has mentioned that “Financial specialists can help IT managers to understand their costs and drivers in new ways.” A large number of companies are following this already and they have financial experts working with CFO and IT to help create efficient IT budgets. These financial experts can also help in the translation process between the IT budget and the fiscal IT budget and assist with the value analysis of the IT services and IT infrastructure (Gruman 2006).

Use budgeting tools and methodologies

            It is a no brainer that usage of budgeting tools and technology would make the life of the IT managers easier. According to the focus group research conducted by McKeen et al., (2015) managers who used the budgeting tools for asset tracking, rolling up and breaking down budgets felt that the tools were really of help while the managers who did not access such tools felt that there were gaps in the budgeting process and there were disconnects all over the place.

Separate operations from innovation

            Maintenance and support should not be mixed up with the new development of projects. IT funds should be assigned to strategic delivers rather than business units to avoid such mix ups. This kind of separation of budget of operations from innovation provides a level of visibility in IT spending which in turn will help the business have visibility and tracking over the new projects as well as maintenance of the ongoing.

Adopt rolling budget cycles

            Instead of having annual budgets, budgets should be accessed more frequently. Having an eighteen-month budgets with quarterly reviews and updates have been proven to be more effective than annual budgets.

Aligning IT budget with the organization’s strategy

            Shimamoto, D. (2012) has proposed that “Once IT initiatives have been evaluated and incorporated into the budget, organization should take a step back from the details and look at the big picture.” It is very essential for the business to ask itself whether the IT budget aligns with the organization’s strategic objective or should there be any reconsiderations in certain areas of the budget.

            Although all of the above-mentioned practices seem to be important, I particularly think that adopting rolling budget cycles is very essential for an organization. The reason for this is that having a locked annual budget disables the control for the business over its IT. Having a long-term rolling budget and adopting to rolling cycles budgets like quarterly reviews will give the business a chance to look at where the IT and business are currently aligning. Business will have an opportunity to re-access and update its budget if necessary.

 

References

Gray, P. (2018, September 4). IT budgeting: A clean sheet. Retrieved February 3, 2020, from  https://www.techrepublic.com/article/it-budgeting-the-smart-persons-guide/

Gruman, G. (2006, July 1). Trimming for Dollars. CIO Maganize

McKeen, J.D., & Smith, H.A (2015). IT Strategy: Issues and practices (3rd ed.). Pearson

Shimamoto, D. (2012). A strategic approach to IT budgeting. Retrieved February 3, 2020, from  https://www.journalofaccountancy.com/issues/2012/mar/20114439.html

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Response 2 in APA format with atleast 2 references.