The New Transparency: Transforming the IT Budget by Informationweek

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									                                                                                     December 2010
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                                The New Transparenc y:
                                Tra n s fo r m i n g t h e I T B u d g e t
                                Factors including a shift from capital to operational
                                spending, consumerization and tech-savvy management
                                are forever changing how IT budgets. What does this
                                mean for CIOs and their financial clout? What can you
                                do if politics get in the way of strategies like chargebacks?
                                In this report, we’ll discuss ways to manage this morphing
                                budget, get your piece of the pie and serve your
                                customers appropriately.
                                                                    By Jonathan Feldman




Report ID: R1901210
                                                                                                The Morphing Budget
A n a l y t i c s . I n f o r m a t i o n We e k . c o m




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                 CO NTENT S                                5
                                                           6
                                                                Author’s Bio
                                                                Executive Summary
                                                           7    Research Synopsis
                                                           8    The Great Divide
                                                           9    Don’t Blame the Cloud
                                                           11   Time to Re-examine
                                                           15   Words to Live By
                                                           16   From Lone Wolf to Team Player
                                                           22   Not So Granular
                                                           26   The Long View
                                                           30   IT Meets Transparency
                                                           35   Appendix
                                                           39   Related Reports
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             2       December 2010                                                       © 2010 InformationWeek, Reproduction Prohibited
                                                                                                 The Morphing Budget
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                 CO NTENT S                                8
                                                           12
                                                                Figure 1: IT Budget: FY 2010 vs. 2011
                                                                Figure 2: Operation Budget Planning Methodology
                                                           13   Figure 3: Percentage of Outsourced IT Operations
                                                           14   Figure 4: IT Budget Timeframe
                                                           16   Figure 5: Cost Reduction Targets
                                                           17   Figure 6: Frequency of IT Budget Benchmarking
                                                           18   Figure 7: Percent of Total Operating Budget Allocated to IT
                                                                          Expenditures
                                                           19   Figure 8: Percent of IT Services Budgeted in Central IT
                                                           20   Figure 9: Primary Reason for Using or Evaluating Cloud Computing
                                                           21   Figure 10: Means of Budgeting for Per-Transaction or Discrete
                                                                           Service Costs
                                                           22   Figure 11: IT Budget Organization
                                                           23   Figure 12: IT Governance Board Influence on IT Budget
                                                           24   Figure 13: Factors Influencing Project Expenditure Approach
                                                           25   Figure 14: IT Operating Expense vs. Capital Expense
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                                                           26   Figure 15: Requirements for Business Technology Elasticity
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                                                           27   Figure 16: Likelihood to Sign Long-Term Agreements
                                                           28   Figure 17: Premium for Short-Term Contract or Early-Termination
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                                                                           Clause
                                                           29   Figure 18: Extra Capacity Built Into New Systems
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                                                           30   Figure 19: Charge Back to Business Units for IT Services
        B




                                                           31   Figure 20: Percent of IT Budget Charged Back to Business Units
        A




                                                           32   Figure 21: Likelihood for Business Units to Use IT Services With
                                                                           Charge Backs
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                                                                                                 The Morphing Budget
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                 CO NTENT S                                33
                                                           33
                                                                Figure 22: Satisfaction With IT Budgeting Process
                                                                Figure 23: Satisfaction With Service From IT Organization
                                                           35   Figure 24: Company Revenue
                                                           36   Figure 25: Company Size
                                                           37   Figure 26: Job Title
                                                           38   Figure 27: Industry
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                                                                                                   The Morphing Budget
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                                                            A n a l y t i c s          R e p o r t




                                                                     Jonathan Feldman serves as director of information technology
                                                                     services for a city in North Carolina. The city has won several
         Jonathan                                                    technology innovation awards during his tenure, including the
          Feldman
     InformationWeek                                                 International Economic Development Council New Media Award.
             Analytics                                               He has also directed professional services in the private sector,
                                                           providing security and network infrastructure services to the military,
                                                           healthcare, financial services and law enforcement markets.


                                                           Jonathan has worked for 20 years in the fields of IT security, reliability and
                                                           human resources management, and has written, taught and consulted
                                                           extensively on these topics, notably as co-author of Maximum Security and
                                                           author of Teach Yourself Network Troubleshooting. His writing, which readers
                                                           call “funny and easy to read,” has been translated into many different lan-
                                                           guages. As an award-winning Network Computing and InformationWeek con-
                                                           tributing editor, he has worked with dozens of public- and private-sector
                                                           organizations to document real business benefits, risks and appropriate
                                                           governance of new technologies and surrounding practices and procedures.


                                                           A speaker at regional and national venues, including Interop, PC Expo,
                                                           CNet Radio, The Institute of Internal Auditors and for the United States
                                                           Army, Jonathan has been active in the community with organizations such
                                                           as Infragard and GMIS International. He holds an MS degree from Georgia
                                                           Tech. Write to him at jf@feldman.org.




             5      December 2010                                                           © 2010 InformationWeek, Reproduction Prohibited
                                                                                                  The Morphing Budget
A n a l y t i c s . I n f o r m a t i o n We e k . c o m




                                                           A n a l y t i c s         R e p o r t


                                     Executive Summary
                                         
								
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