Traditionally, IT teams built their campus technology environment from the ground up. They implemented hardware builds that not only accrued large initial costs, but also hefty replacement expenses. In fact, preliminary costs were so large, cyclical expenditures into refresh cycles of equipment were often paid for as capital expenses. Because of the large investment, IT leaders were “encouraged” to service and extend the use of outdated equipment for as long as possible.
Fast forward to today. Technology is now increasingly agile, responsive, integrative, flexible, and streamlined, and funding models of higher educational institutions need to reflect this.
How to improve funding for IT
If capital expenditures are generally meant for static investments and operating expenses are intended for variable, operating costs, it only makes sense that rapidly changing technology would be better shifted to predictable operating expenses. So how can funding models be improved, and what conditions need to be in place so that they support, rather than hinder, innovation?
1. Shift capital expenses to predictable operating expenses.
Instead of purchasing technology based on outdated, long-term projections, shift spending to the cloud or a partnering provider that understands university industry trends and can be responsible for delivering results. Pay only for services needed, when needed. This, combined with reducing or eliminating up-front capital risk—and getting a service-level agreement (SLA) that ensures output—frees institutions from dependence on capital expenditures and leads to more proficient operational spending.
Universities can create predictability around technology changes by:
• Investing in services that naturally adapt to the ever-rapid changing technology
• Focusing less on technology service deliverables and more on delivering teaching, learning, and research
• Partnering with companies that have a perspective based on university industry trends rather than just on-campus
• Keeping abreast of future technology adoption trends
• Being nimble to adapt to changing conditions fast
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