So, you're looking at investing in a new digital technology? It could be your server, client management system or finance system. It's important that you take into consideration all the costs that may not be obvious at the start. To help you, we have developed a checklist you can use as a starting point for creating a budget, the systems acquisition budget checklist
This systems acquisition budget checklist will help you develop a budget for the complete process of acquiring a new technology-based system. It’s not a primer for systems acquisition or general budgeting. But it will prompt you for the things you need to consider when working out what it will cost to acquire a new technology system. The spreadsheet does not include ongoing costs, which must also be taken into account when considering software acquisition.
It’s easy to underestimate the effort and costs involved when preparing your budget. The checklist will help you think about all the relevant activities and costs. It’s been designed to provide a clear way of presenting the processes, what needs to be purchased, what support is required and what it will cost. What you’ll need to include will vary depending on the nature of the system - for example whether it is for service delivery, financial, email and so on.
There are 3 steps to choosing a new digital technology:
- Figuring out requirements: listing what you're trying to do and the issues you're trying to solve
- Selecting the appropriate technology: finding the right system to match your requirements
- Implementing the solution: once you've decided which system you need, it's time to install and set it up
This checklist is designed to help you think through the major elements of the budget for a new system. The list, a checklist of items that are sometimes overlooked, is not exhaustive. It’s grouped by project stage, but many organisations will have costs in the first four areas that occur across many (or all) of the subsequent stages.
- Project management
- Backfill: to cover the costs of backfilling staff who are dedicated part or full time to the project
- Travel: to develop requirements, bring people together for the vendor demonstrations, decide on the system, etc.
- Contingency to cover unforeseen expenses such as functionality, reports or training that weren’t identified in the early stages of the project but are critical for the organisation.
- Requirements development: identifying what you need, key processes, reports and data. Costs may include a mix of external consultant/business analysts and/or internal staff.
- Advice: including external consultants and business analysts
- Legal advice on the contracts.
System implementation: vendor costs
- Software licence fees: for main system and ancillary systems such as separate report writers (costs may be ongoing, and/or there may be one-off charges)
- Vendor implementation: e.g. system configuration, customisation, setting up reports, testing, data migration, training. Ensure you include integration with other systems and development/enhancement costs if required
- Infrastructure and hosting setup: for main system and ancillary systems such as report writers.
System implementation: internal costs
- Implementation support: to load information about your clients into the system, support the setup of key forms and reports, assist with training, etc.
- Software licence, and maintenance fees: for main and ancillary systems
- System support: for main system and ancillary systems
- Hosting: for main system and ancillary systems (especially if hosted on your infrastructure)
- System development and enhancement: if you may require additional new features
- Additional licenses: if you anticipate growth
- System specialist: a dedicated staff member or external person, part- or full-time, supporting the system to configure reports, train and support users, and so on.