What’s Lurking in the Shadows of Your IT Budget?

What’s lurking in the shadows of your I.T. budget?

For most businesses these days IT is (or should be!) a distinct budget item. Cost commitments vary depending on the type of organisation, of course, but knowing what technology costs you is important so that you can plan and ensure things are under control.

The big question is, even if you have what you consider a carefully managed budget, how much of your business IT spend is actually happening in the shadows?

It sounds sinister but it is really easy for spending on bits and pieces of technology services and products to happen without them being accounted for properly. When you business grows and such under the radar spending grows with it, you can find it a bit of a shock if you ever get around to quantifying it.

What is shadow IT spending and how does it happen? There are so many scenarios which open the door to unplanned costs. It can happen when a member of staff or a department decides it needs a tool to get its job done. That might be a subscription to an online service to support social media work or a trip to PC World to buy a camera because “we needed to take those pictures straight away”. It might be a monthly payment to a file transfer product or cloud storage to help a manager move their work between sites or home and the office.

Many of these things can be useful, though they should be planned and, importantly, approved. If a service is started by a team member who borrowed the company credit card to subscribe, the fact that it’s still running, unneeded, 18 months later is usually of little concern to them. They might even have left the company.

Two-Pronged Risk

That account could be sitting dormant with sensitive company or customer information in it. That presents a two-pronged risk to your business.

In big companies shadow spend can happen because IT departments are often cited by staff as being too slow to approve new hardware or services. There could be good reasons for that, because new additions often need evaluating to ensure they work with existing systems and don’t pose some unacceptable threat to security and/or reliability. This is especially true in highly regulated sectors.

In smaller firms it could simply be a matter of the boss not being clear on what the spending is for or whether that piece of kit really will make their sales team more effective (or just make it easier for them to spend time on Facebook…).

Like in many areas of business, there is a balance to be found. Having a process that allows good ideas for new hardware and services to come forward and be assessed by those who have to use and pay for them could pay dividends. It also means that you can take a measured approach; allocate some acceptable level of budget and then review in an agreed time-frame before either accounting for it or not in future budgets.

Taking the time to trawl through the IT your business has paid for (and may still be paying for) that doesn’t feature in the budget could be time very well spent. An audit of your networks and systems might not be the most fun – and may well not be in your field of expertise – but you can call on someone who does know to find and assess those rogue additions with you.

For instance, Bespoke Computing provides a Virtual IT Director service. You might not have an IT guru on staff, but you can bolt one on to be there when you need strategic or practical advice that falls outside of your own remit.

Being in the dark about any part of your business is no fun – and it makes it really hard to see what’s lurking in the shadows!