Process

Determines IT financing sources and the appropriate level of funding to allocate.

A1Funding Sources: Establish sources of IT financing, which may include a centrally allocated IT budget, allocations from other business units, and external sources (for example, joint ventures, industry consortia, vendors, suppliers, clients, and so on). Understand the costs of financing and the expected benefits to be derived from each funding source.
A2Funding Levels: Set the overall level of IT funding for the organization based on, for example, strategic priorities and competitive benchmarks.
A3Allocation: Allocate funding to broad categories of IT activity (for example, infrastructure/product improvements, capability development) to align with objectives and derive business value.
A4Performance Measurement: Use metrics to track, evaluate, and improve funding-related outcomes – for example, cost of funds, spend by category/initiative/business unit, return on investment (ROI), return on assets (ROA), and so on. Link funding to the benefits derived to determine the impact of funding.