Budgeting & Forecasting

Key role(s)


Establish a solid IT budget and regular monitoring and updating


Make the IT budget more transparent and iterative by improving communication between IT and businesses.

A number of activities are recommended to improve the IT budget and its follow-up:

Illustration of the initial actions to be taken
Illustration of the initial actions to be taken

Business Planning

The top down IT budget made as a result of the business planning is typical for an organization where IT is considered as a cost center. In order for it to (re)become a business driver, its budget must be made during the business planning phase by integrating the segmentation defined with the business lines but above all by basing the costs on the estimated consumption of services by the business lines and the unit cost of these same services.

Baseline & Zero-based

We can mix approaches:

  • The baseline approach, which is based on last year's expenses
  • But also on the so-called "Zero-based budgeting" approach, which consists in reviewing each euro of the budget, asking oneself if it corresponds to the need and giving a better visibility on the cost drivers and business targets.

Monthly Reporting

Going hand in hand with this budgeting approach comes the regular reporting (at least monthly) to be set up for each application, service and/or sub-perimeter depending on the context:

  • by comparing the actual to the budget,
  • analysing the reasons for variances
  • by re-estimating the consumption of services by the business lines and therefore their unit cost in order to anticipate budget overruns.
Example of KPIs and common reporting
Example of monthly reporting


Finally, reforcasting is an exercise not to be neglected. Why wait until the end of the fiscal year if we know that previous trends and re-estimates indicate that the budget is no longer relevant?

See previous card

Cost-Delay-Quality Decision Scenarios

ID 3S2

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Goal control

ID 3G2