One would think with all the advancements in technology–the streamlining and efficiencies–that the process would only get easier. Budgeting in government and higher education is more difficult than ever and, mark my words, will be the increasing-to-primary pain point for technology leadership in the next decade within our industries.

Why? We are replacing large, multi-year, heavily negotiated super-solutions with many one-off, scalable softwares (sometimes hundreds) and a high percentage of those will be, dare I say it, in the cloud.

We are lowering the number of hardware purchases and replacing these with invisible purchases in pursuit of a more agile network environment (VDI Virtual Desktop Infrastructure, server virtualization, file storage and sharing) resulting in the answer, “I can’t show you anything tangible that I’m buying besides the invoice.”

Bring Your Own Device (BYOD) initiatives also lessen the standard computer refresh purchases and require more invisible bandwidth, storage, speed.

All of this is happening at an increasing rate but, hold on, these purchases are contracts, licensing, and annual agreements. Contracts, licensing and agreements are operational expenditures, not capital. But we have a finite amount of operational funds…those are not increasing dramatically. We have large clumps of capital dollars that we can’t spend and that can’t be simply transferred to our operational bucket.

So now what? Suddenly we’re replacing high-dollar historically capital expenditures with massive amounts of operational expenditures. What will be easier? Advocating for significantly more operation dollars in the non-profit sphere (never happen) or redefine what “capital” means as it pertains to technology?

Today, if not yesterday, begins the heavy collaboration and communication with your finance teams. How can you manage this? How can you manage budgeting and funding intangibles – storage, space, bandwidth, speed – that used to be traditional tangibles like servers, wiring, computers and physical SANs? It’s going to take some creativity, some updated policies and some clear definitions of technology infrastructure, but hopefully it will all shake out in the end. (Note: I do not have this all figured out yet, just trying to start the discussion and keep it at the forefront.)

(Next page: Three higher ed cost-saving tips)

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