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Preparing a Technology Budget

Written by: Steven G. Atkinson

Article Overview: When preparing a budget on new technology it’s important to look at everything that is needed within the project. Sometimes the proposal that is received from a vendor is only one small piece of the entire project. When looking over the total cost of a project, those cost can be put into one of three categories. Those are One-time cost, Annual operation expense, and additional support services. The following are some of the things to consider when putting together a technology budget.

Preparing a Technology Budget

When preparing a budget on new technology it’s important to look at everything that is needed within the project. Sometimes the proposal that is received from a vendor is only one piece of the entire project. It may even be just a small part of the overall budgetary amount.

When looking over the total cost of a project, those cost can be put into one of three categories. Those are one-time cost, annual operation expense, and additional support services.

The following are some things to consider when putting together a technology budget.

Hardware
• If purchasing new software is the current hardware adequate or is will new hardware need to be acquired?

Integration
• Is the new technology a stand-alone item?
• Will it need to be integrated into other current installed hardware or with existing software?
• Even it’s not being integrated into existing hardware or software, it is being incorporated in the way the company does business.
• Who is going to be doing the integration and what is that cost?

Site Preparation
• Are changes going to be needed in the physical location of the new technology?
• Is new or additional furniture needed?
• Is the electrical or telecommunication infrastructure adequate?
• Is the environmental system?

Training
• What is included in the training package?
• Who gets trained?
• How many?
• How much time will be allocated?
• Where will the training take place?

Documentation
• Are you getting any?
• What is included? Installation manuals? Operational manuals? User guides?
• It may be of benefit to have a user guide created specifically for the company and those costs would need to be included.

Additional required products
• Are any pre-existing hardware or software needed prior to installation?
• Does pre-existing hardware meet the new software requirements?
• Are upgrades or current hardware or software needed?

Installation
• Who is doing the installation?
• Are the costs in the proposal?
• Cost for after installation changes and modifications?
• Are other support people needed? Do they need to be on-site or on-call or would telephone support be enough?

After Installation Support
• What kind of support is offered after installation?
• When is the support available? 24/7? 40/5?
• Response time?
• How much free support, how long and how much?

Annual fees
• Are there recurring annual software licensing or maintenance fees?
• Is there a termination policy on maintenance contracts with an out clause?
• Who can cancel contracts and time frame to do so?

These are just some of many items that may need to be evaluated when doing a technology budget.

© 2007 Steven G. Atkinson – All Rights Reserved

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Article Tags: annual software, entire project, new technology, technology budget, technology budget, total cost, When preparing a budget



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