Quantifying and communicating the value of a Software-as-a-Service (SaaS) space management solution to decision makers can be time consuming and tedious. If space management software is on your wish list this year, now is the time to start building your budget.
Make the Budget Approval Process Easier with Wisp
1. Understand Decision Maker(s) and the Budget Approval Process
When putting together a budget for a space management solution, one of the first steps is understanding who the decision makers are and what the process looks like to gain budget approval. While the budget approval process is a straightforward task for some organizations, for other companies this can be a more complicated process. The approval process may be a ladder of approvals where you may need to get buy-in from a manager before bringing the budget up the ladder to the C-Suite. Understanding who is part of the process will help you understand the timeline, resources, and support you’ll need to get the budget approved.
2. Consider Capital Expenses vs. Operational Expenses
When creating a strategic budget for space management software, consider leveraging multiple budgets to allow for more flexibility. Capital expenses (CapEx) are typically one-time expenses that can be depreciated. They often include budgets for projects and one-time purchases. Operating expenses (OpEx) are usually ongoing expenses required for operating the business. Therefore, the one-time implementation fees associated with software can often come from the capital budget and the annual subscription fees can come from the operating budget.
Also consider any upcoming or current real estate related projects that already have a CapEx budget associated with it. These may include acquisitions, mergers, relocations, renovations, and restacks. By using the budget for the project to purchase the software, you can also take advantage of the planning features to significantly reduce the time and manual efforts typically associated to these types of projects.
3. Make Your Budget Work for You
If you’re struggling to receive approval on your original budget, consider navigating a smaller one. Depending on your space management solution, part of navigating a smaller budget can include scaling back the features, starting with a pilot, sharing the expenses with other departments, and/or looking at how fees can be spread throughout a period of time. When looking at the core features needed for a space management solution on day one vs. nice-to-have features rolled out in the future, scaling back is a great way to reduce the fees for budget approval. If you have a global portfolio or multiple locations, starting with a smaller pilot sample can reduce the costs significantly and showcase the ROI with low risk.
Beyond a space management solution benefiting Corporate Real Estate and Facilities teams, it can also benefit many other departments within an organization. Some other departments to consider splitting the budget with include Finance, HR, IT, Security, and Office Administration. When looking at your budget timeline, understanding if there is an option to disperse the fees over a period of time can be beneficial. For example, if your fiscal year starts over in July; however, you have some of your budget left yet this year to use up, you can take advantage of getting the one-time fees into the budget before the new fiscal year starts.
4. Create a Contingency Plan
Anticipating internal challenges in any budgeting process can help you and your team be prepared for an assortment of obstacles or objections. Whether these hesitations include budget constraints, lack of leadership buy-in, or even overly committed workloads — having a well-prepared contingency plan will help you navigate the uncertainties and keep the main pain points the space management solution is solving at the forefront. Have confidence going in presenting the budget you’re wanting from day one. However, be prepared with a contingency plan to talk through on the spot if red flags come up during the conversation. This contingency plan can include any of the considerations above to lower the budget amount, timeline, or resources needed, which can ultimately help you get a foot in the door to your full space management goals.
Navigating the budget process for your space management software requires a thoughtful and strategic approach — combining a clear understanding of the decision makers, what the approval process is, outlining different expense options, making the budget work for you, and creating a contingency plan. One of the most challenging aspects of evaluating a space management solution is getting the budget approved. When it’s time to present your budget, relate your budget to the positive impact the space management solution will have on your workplace, and stand by the budget you’re presenting. If you’ve taken the time to put together a detailed budget plan, you’ll be spending your time explaining your budget, not defending it. By utilizing the four considerations above, you can be confident going into your budget conversation that you have all aspects considered and a well-thought-out plan in place to receive the green light on a space management solution.
What’s Next?
Now your budget has been approved but you still need that buy-in from leadership to move forward with a space management solution. Crafting a compelling business case can be a time consuming and daunting task, but we have taken the guess work out of the process, leaving you with the five essential steps for crafting your space management business case.