Budgeting For Technical Resource Costs

By Eric Johnson, World Bank Institute (WBI); Sherine Ghoneim, Economic Research Foundation (ERF); Margaret Nyrambura Ndung'u, EcoNews Africa; Sangeeta Gupta, The Energy and Resources Institute (formerly the Tata Energy Research Institute) (TERI)
May 2001

The Information technology field is changing very rapidly and there is a continuous need to keep upgrading the equipment and the software as well as updating the content. Site maintenance is crucial in ensuring that the site remains relevant and updated.

Technical resources should be well budgeted for when financing and budgeting for Web products and services. The technical resource requirement is generally underestimated because CSOs are rarely sure what they want and how they want it. There are many technical products and it's often difficult trying to determine what software or hardware is best for a specific task.

Equipment can be leased or purchased. To determine which is the best option, an analysis of the activities against the associated cost should be done in order to come up with the most optimal decision. Project duration and sustainability is a major determining factor for this. The monthly running costs should be calculated and a yearly estimate established to determine if the budget allocation is enough to finance the activities.

Technical resources could be charged as a percentage of the budget, as part of administrative and operational costs or fundraising could be done to cover these particular activities. It is important to ensure that sustainability of technical resources is well budgeted for and financed. There is continuous need to keep upgrading the equipment and the software as well as updating the content. Site maintenance is very crucial ensuring that it still has the intended relevance and topic coverage, and requires the technical equipment to do so.

When planning for budgeting and financing technical resources, the following should be taken into account:

Infrastructure

The infrastructure refers to all the required hardware for Web access. Each component needed should be critically examined and budgeted for appropriately. Technical resources under the infrastructure will be classified as the cost of purchasing Web tools such as:

• server (hardware and software);
• scanner for graphics and pictures;
• software for animation;
• printers;
• backup facilities;
• routers and hubs;
• leased lines;
• network cables; and
• modems.

Connectivity options

Connectivity options also need to be determined before hand. Some of the issues to consider are: Do you use a dial-up or a leased line? What are the cost implications and are they justified? What are the alternative technologies that can be put in place? Based on planned activities, is it more viable to purchase and own the equipment or is it better to sublet the equipment?

Hosting and maintenance

Once the above has been taken into account, it is important to come up with a decision on the modalities of hosting and maintaining the site. Do you contract an ISP, or do you host your own content? What are the cost implications for the decision taken and how viable are they?

Overhead

Overhead items such as electricity costs, telephone costs, communication costs, etc., need to be included in the budget.

Generally, when financing and budgeting for the technical costs, the following should be taken into account:

• equipment unit cost;
• cost of the associated software and upgrades;
• connectivity options and the associated costs;
• cost of maintenance and servicing;
• cost of servers and database upgrades;
• the cost of the required hardware and software;
• the cost of a leased line (monthly basis);
• the cost of maintaining the equipment (i.e., monthly or yearly servicing);
• the cost of rent for hosting the equipment in case a separate house is required; and
• security and insurance issues.