IT Budget Forecasting Methods

Forecasting Methods

Method	How It Works	Best For
Top-down	% of revenue allocated to IT	Quick estimates
Bottom-up	Sum of all IT costs item by item	Detailed budgets
Zero-based	Justify every expense from zero	Cost optimization
Activity-based	Cost per IT activity	Service costing

Recommendation

Use bottom-up for detailed budgeting, top-down for quick validation. Review quarterly and adjust based on actuals.