18 September 2014

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Mitch Mitchell - Pegasystems

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IT Budgets

31 July 2014  |  1930 views  |  0

What Does Your IT Budget and My Childhood Pocket Money Have in Common?

  1. You need to spend it wisely, as it is limited, but continue to provide for your needs now and into the future (or at least until your siblings have exhausted theirs, thus allowing for gloatfactor).
  2. Allowance must cover mandatory spending — that gift for your mum will reap significant returns!
  3. It must deliver goods that are as yummy and exciting as the wrapper promises — no old and expired sweets here, please!
  4. It must be flexible because I don’t know if I want to buy sweets or Pokémon cards; what I want today will change tomorrow when I see my big brother with a Super Soaker 2000.

Approved budgets, like your childhood pocket money, are both a rare and cherished entity that somehow never seems to buy quite enough sweets! So the sweets you can buy need to fulfill a few different things.

I can remember being handed my weekly pocket money; it was a prized and anticipated event. As soon I got it in my hands, it was off to the next event: what to buy! While spending my pocket money, I had to make sure I didn’t run out of cash before securing enough ‘stuff’. Cash or ‘stuff’ had to be available until after the time my sister had run out of one, or both of these things. Failure to comply with this would lead to ceaseless ‘nuh-nuh-nuh-nuh-nuh’ kind of teasing about what she had and what I didn’t have. Sound familiar? So, in case you are not following the ‘sweets/comic’ analogy, our IT budgets have to allow us to both beat the competition and provide for the acquisition of new features into the future.

And then there’s compliance, the regulatory spending that has the same effects as allocating chunks of my £2 to;

  1. gifts for family members
  2. the “must have” accessory to ensure inclusion in the ‘cool kids’ club  
  3. a few pennies for the ‘piggy bank’ to ensure adequate provisions for holiday spending.

It’s rather unexciting, perhaps not the most pulse-pounding way to spend my precious money, but worth it versus the consequences. But, wise spending now will reap benefits later: Mum will be happy, thus endowing me with greater gifts, I won’t be socially scarred for life, and spending money on holidays is just a must. You are following me, right? Compliance spending is the same. You have to ‘pay the piper’ – the regulatory bodies need to be kept happy. There is also the need to want to be the cool kid who is up to date with all the latest regulations. After all, who doesn’t want to see the return from keeping customers delighted with lovely service?

Then I need what I buy to deliver — to be that first bite into a Milky Way or Snickers bar. It is the only one I am getting this week, so it needs meet my lofty expectations. My software needs to be as fresh and delightful as I anticipated. It needs to be new and exciting. No old, squishy chocolate here, please!

And then, to bring it all together, my software needs to be flexible. Today, it might be Snickers and Pokémon, tomorrow it’s a Super Soaker 2000 and a Spiderman comic.

Hopefully your IT budget is more than £2. Recent press sentiment is indicating that spending in the Default and Collections space will accelerate in 2015 as we recover from the challenges of recent years. It’s been a tough time for both our customers and organizations as they are still getting back to business, but with some money in the IT piggy bank and a budget spent wisely, they can look after you well into the future.

TagsWholesale bankingInnovation

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Mitch Mitchell

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Industry Principal - Lending

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Pegasystems

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