Management: Finance


Installing and managing technology in schools involves allocating (and reallocating) resources. Educational decision making almost always leads to decisions about resource allocation. In the planning process, budgets can inform the allocation of resources (budgeting as a part of technology planning is covered in Chapter 1). Knowing what has been expended supports future planning by comparing prior inputs to expenditures and allows decisions to be made about relative priorities. What to include in expenditures for technology, and how to organize the information, is what this chapter is about.

Awareness of the financial obligations associated with technology implementation and maintenance can go a long way toward ensuring two important management goals. First, budgets must be adequate to reliably support the technology system as designed. Second, a financial plan must include the necessary funding to replace technology components as they become obsolete. The lack of either of these key ingredients in the budgeting process will ultimately result in a technology system that does not function as an effective tool and can actually become a political liability to a school system. School districts would then be forced to deal with a significant decision-making issue in explaining to the community the rationale for the original technology expenditures.

This chapter provides suggestions and resources to assess expenditures for technology. Answering the key questions for this chapter amounts to estimating the annual share of a school or district's Total Cost of Ownership (TCO) for technology. TCO is a concept from the business world that is applied to the lifecycle costs of computing, usually standardized as a ratio of costs per equipment unit, such as a desktop computer (see sidebar "Understanding Total Cost of Ownership" that begins on the facing page for a discussion of its application in schools). The TCO concept can assist educational leaders to understand more clearly the costs required to successfully implement educational technology. A number of TCO support instruments and discussions can be found online: the Consortium for School Networking (CoSN) offers "Taking TCO to the Classroom" (; other resources can be found at

Another important concept is return on investment (ROI). More important in administrative than in instructional applications, ROI analyses usually focus on the amounts of money saved by implementing technological advances or innovations. An example of such analyses can be found in a report to the San Diego City Schools Board recommending adoption of an electronic form (see

There are two aspects to the financing of technology (or any entity, for that matter): expenditures and revenues. Revenues would be fairly straightforward to discuss, but are less germane to financial analyses for technology than expenditures. For the present, this chapter restricts its consideration of technology finances to expenditures.