A Guide to IT Budgeting for Nonprofits and Small-Medium Businesses


It’s no surprise that managed IT services are a necessity for businesses to thrive in our ever-changing digital market. Areas such as network administration, cybersecurity, and maintenance can always be improved upon by IT specialists as they work to scale and grow almost any type of nonprofit or small-medium business. However, budgeting for such IT services can be challenging, as incorrect planning may lead to financial strain, system disruptions, or an increased risk of cyberattacks.

Moreover, creating an effective IT budget plan isn’t just about keeping costs down; it’s also a strategic roadmap that will determine the longevity of your business. You’ll be able to allocate resources more efficiently, scale your business up or down accordingly, and keep investors and stakeholders happy.

Here’s a brief guide on IT Services for nonprofit organizations, and how small-medium business can properly budget for IT services.

Assess Your Current IT Infrastructure

It’s important for businesses to evaluate their existing IT infrastructure and services to determine how their budget should be allocated. Below are a few key aspects to investigate:

  • Hardware
    • Network equipment, servers, computers, printers
  • Software
    • Operating systems, security, productivity software
  • Service Catalog
    • Cloud services, web hosting, data backups
  • Maintenance Contracts
    • Look for expired contracts
    • Examine contract terms and any hardware/software coverage
  • Employees
    • Salaries and benefits
    • Recruitment and training
    • Payroll taxes
    • HR-related expenses
  • Security Controls
    • Do you need to be HIPAA compliant?”
    • PCI compliant?
    • Are you protected against ransomware?
    • Can you recover from a disaster?
    • Are you protecting your client’s private information?

Estimate Costs

Create a detailed estimate of hardware, software, maintenance, licensing, and so forth costs. This will ensure that you accurately understand how much each of the above aspects will require financial resources. 

And if you’re ever unsure about certain IT-associated costs, don’t hesitate to contact a consultant or IT specialist knowledgeable about IT cost estimations. 

Budget For Contingency Funds

By setting aside a portion of your IT budget as a contingency fund, you can create a financial safety net to mitigate the impact of unexpected events or emergencies. Below are a few to consider:

  • Data breaches
  • Hardware failures
  • Cyberattacks
  • Software vulnerabilities
  • Natural disasters
  • Power outages
  • Human error

Set Clear Objectives and Expectations

Consider what you’d like your business to achieve in the short-term and long-term, be it security improvements, scaling business operations, or enhancing productivity. This level of clarity will help to shift your focus toward the areas that need the most improvement, which is, ultimately, what effective decision-making is all about.

Setting clear goals and expectations also serves as a benchmark for measuring progress. It may also be helpful to break down a large goal into smaller, more manageable steps for you, your team, and any IT specialists working with you.

Explore Managed IT Services

Sure, you could theoretically manage all aspects of your IT infrastructure independently. However, outsourcing these tasks to IT specialists has various benefits, such as specialized knowledge and expertise, unbiased perspectives, and in-depth audits.

You’ll also receive maintenance and guidance regarding the following:

  • Network management
  • Cloud services
  • Risk mitigation, HIPAA compliance
  • Cybersecurity
  • Disaster recovery
  • And much more

Moreover, outsourcing IT specialists ensure that every aspect of your IT infrastructure will operate smoothly and efficiently for the long haul, ultimately leading to cost savings.

Monitor and Adjust Your Budget

It’s important to regularly review your IT budget and associated spending habits to identify unexpected expenses or deviations from the original plan.

Budget reviews should be conducted alongside specific long project deployment cycles for businesses engaged in specific projects. Small businesses benefit more from monthly budget reviews, while medium-sized businesses typically review their budget plans every quarter. These same guidelines also apply to small and mid-sized nonprofit organizations.

In short, budgeting for IT services isn’t so challenging after all. By breaking down a budget plan into smaller, more manageable steps, any business can allocate its financial resources more efficiently and scale its operations as needed.
Take the first step on your strategic budget roadmap with TVG Consulting today. Schedule a Free Consultation to learn more about our managed IT services.