Budget Tool: Gray Cells Contain Calculations That Should Not

Budget Toolgray Cells Contain Calculations That Should Not Be Altered

Budget Toolgray Cells Contain Calculations That Should Not Be Altered

BUDGET TOOL Gray cells contain calculations that should not be altered. [Company Name] Technology Budgeting Tool [Date] Company Data Required rate of return 10% Tax rate 30% Initial Investment YEAR Hardware costs (e.g., servers, networking hardware, PC upgrades) $1,000 Purchased software costs / licenses (e.g., e-commerce, ERP, CRM software) $0 Development costs (e.g., systems design and configuration / development) $0 Training costs (e.g., develop and conduct initial training) $0 Conversion costs (e.g., initial data conversion from existing systems being replaced) $0 [Other initial investments] $0 [Other initial investments] $0 Total Initial Investments $1,000 Benefits from Technology Strategy YEAR Increased sales and revenue $1,000 $1,000 $1,000 Reduced personnel costs $0 $0 $0 Reduced product costs $0 $0 $0 Reduced distribution costs $0 $0 $0 Reduced advertising and marketing costs $0 $0 $0 [Other benefits] $0 $0 $0 [Other benefits] $0 $0 $0 [Other benefits] $0 $0 $0 Total Benefits $1,000 $1,000 $1,000 Costs (Excluding Initial Capital Investments) YEAR Depreciation on capital expenditures (calculation uses three-year period) $333 $333 $333 Software licensing fees $0 $0 $0 Ongoing user support and training (e.g., help desk and training personnel) $0 $0 $0 Ongoing systems support (e.g., IT maintenance) $0 $0 $0 Hosting / Cloud computing $0 $0 $0 General and administrative $0 $0 $0 [Other costs] $0 $0 $0 [Other costs] $0 $0 $0 [Other costs] $0 $0 $0 Total Costs $333 $333 $333 Totals YEAR Net Benefits (Costs) $667 $667 $667 Tax $200 $200 $200 Value after tax $467 $467 $467 Depreciation added back $333 $333 $333 Cash flow ($1,000) $800 $800 $800 Cumulative cash flow ($1,000) ($200) $600 $1,400 Evaluation Metrics Net present value (NPV) $989 Internal rate of return (IRR) 60.74% Payback period (in years) 1.25 Three-year total ROI: (total benefits before taxes - total costs)/total costs 200.00% IT Strategy for [Company Name] [Student Name] [Course and Instructor] IT Strategy for [Company Name] [To introduce your IT strategy, provide an executive summary that clearly describes what you are recommending and why it will benefit the business.

Include a brief summary of the financial benefits. This introduction should be a paragraph or more, but less than a page.] Description of the Business [In one or more paragraphs provide a description of the business and the issues / opportunities associated with the business. This section should include what is known about the products, customers, competitors, and financial situation for the case study. The description of the business should be less than a page.] IT Strategy Proposal [In one or more paragraphs, introduce the IT initiatives you are proposing. You must have at least three initiatives, but you can have more than that.] [Heading for Initiative One] [Describe initiative one in detail.

Make sure you include how the initiative will benefit the business. Any technical terms need to be explained so that a business person can understand what you are proposing. Each initiative should be less than one page.] [Heading for Initiative Two] [Describe initiative two in detail.] [Heading for Initiative Three] [Describe initiative three in detail.] Sourcing Strategy [In one or more paragraphs, describe your sourcing strategy. Will the implementation of the initiatives be done with in-house or outside resources, or a combination of the two? Will ongoing support be done with in-house or outside resources, or a combination?

In other words, who (what organization) will do the work? You will need to explain why are proposing a certain strategy. For instance, outside expertise may be needed to supplement the internal personnel regarding the use of certain technologies. Make sure the financials reflect the costs in your sourcing strategy.] Financial Case [Describe the cost / benefit analysis in one or more paragraphs. Be very clear about how much the IT initiatives will cost and what the expected benefits will be.

Cite resources that you used to develop your cost / benefit analysis. For instance, you may have found an article on another company that was able to achieve a 20% increase in sales with an initiative similar to what you are recommending. The more concrete examples you can cite, the more believable the financial case will be. After summarizing the financial reasons for your proposal, refer the reader to Table 1. Update Table 1 on the next page with the data from your return on investment spreadsheet.] IT Strategy 7 .

Table 1 Return on Investment [Company Name] Year Initial Investment Hardware costs $0 Purchased software costs / licenses $0 Development costs $0 Training costs $0 Conversion costs $0 [Other initial investments] $0 [Other initial investments] $0 Total Initial Investments $0 Benefits from Technology Strategy Increased sales and revenue $0 $0 $0 Reduced personnel costs $0 $0 $0 Reduced product costs $0 $0 $0 Reduced distribution costs $0 $0 $0 Reduced advertising and marketing costs $0 $0 $0 [Other benefits] $0 $0 $0 [Other benefits] $0 $0 $0 [Other benefits] $0 $0 $0 Total Benefits $0 $0 $0 Costs (Excluding Initial Capital Investments) Depreciation on capital expenditures $0 $0 $0 Software licensing fees $0 $0 $0 Ongoing user support and training $0 $0 $0 Ongoing systems support $0 $0 $0 Hosting / Cloud computing $0 $0 $0 General and administrative $0 $0 $0 [Other costs] $0 $0 $0 [Other costs] $0 $0 $0 [Other costs] $0 $0 $0 Total Costs $333 $333 $333 Totals Net Benefits (Costs) $0 $0 $0 Tax $0 $0 $0 Value after tax $0 $0 $0 Depreciation added back $0 $0 $0 Cash flow ($0) $0 $0 $0 Cumulative cash flow ($0) $0 $0 $0 Evaluation Metrics Net present value (NPV) $0 Internal rate of return (IRR) 0.0% Payback period (in years) 0.0 Three-year total ROI 0.00% Implementation Timeline [Describe the timeline and sequencing of the IT initiatives in one or more paragraphs.

Make sure the timeline is consistent with the financials. For instance, if initiative three does not go live until year two, you cannot show any benefits for that initiative in year one. Be very clear about when the initiatives will be implemented. Will all initiatives be implemented at the same time or will the initiatives be implemented one at a time? Explain why you are proposing a specific sequence.

In addition to describing the timeline, you can include an APA figure for the timeline, if that is additive.] Plan for Sustaining the IT Initiatives [In one or more paragraphs describe your plan for ongoing operations and support of the IT investments you are proposing. If you plan to use a particular governance model and / or a portfolio management approach, describe it here. Include the KPIs (key performance indicators) that you will use to measure the value of the IT work.] Summary [Provide a one- or two-paragraph summary of your IT strategy and how it will add value to the business.] References Last Name, F. M. (Year). Article Title 1.

Journal Title 1, Pages From - To. Last Name, F. M. (Year). Article Title 2. Journal Title 2, Pages From - To.

Last Name, F. M. (Year). Article Title 3. Journal Title 3, Pages From - To. Last Name, F. M. (Year). Article Title 4. Journal Title 4, Pages From - To. Last Name, F. M. (Year). Article Title 5. Journal Title 5, Pages From - To. Last Name, F. M. (Year). Book Title. City Name: Publisher Name.

Paper For Above instruction

The provided document is a comprehensive budgeting template combined with an outline for developing an IT strategy proposal for a company. It includes detailed financial data, such as initial investments, benefits, costs, and evaluation metrics like NPV, IRR, and ROI, over a three-year period. The template emphasizes the importance of adhering to calculations that should not be modified and provides a structured format for presenting strategic IT initiatives, sourcing strategies, financial justifications, implementation timelines, and sustainability plans. The core purpose of this document is to guide the development of a thorough IT strategy that aligns with business objectives, ensuring that all financial and operational implications are carefully considered.

In formulating an IT strategy based on this template, a business analyst would start by understanding the company's current state, including its products, customers, competitors, and financial health. Based on this assessment, they would then identify key IT initiatives that could include upgrading hardware, implementing new software solutions, or improving support systems. Each initiative must be justified in terms of its benefits, costs, and return on investment. For example, investing in new hardware might increase efficiency or sales, while reducing costs over time.

Furthermore, the sourcing strategy would decide whether these initiatives should be handled internally, through external vendors, or a combination of both. This decision would be informed by the company's capabilities, the complexity of the technology, and financial considerations. Supporting this, a detailed financial case would quantify the expected benefits versus costs, bolstered by real-world examples or similar case studies, adding credibility to the proposed initiatives.

The implementation timeline would be carefully planned to ensure that benefits are realized in a sequential and logical manner, considering dependencies among initiatives. Additionally, a plan for sustaining the IT investments through ongoing operations, support, governance models, and KPIs would be described to ensure continuous value delivery.

Finally, the executive summary would encapsulate the strategic vision, highlighting how these initiatives will drive operational improvements, cost savings, enhanced customer satisfaction, and ultimately, increased profitability. An integrated approach that combines financial analysis, strategic planning, and operational support will ensure that the IT investments deliver measurable value aligned with the company's long-term goals.

References

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