Why does the capital budget make a difference?
Nagesh: If you look at the way corporate budgets are structured, they have the G&A component which stands for General and Administration. Then, you have the Capital component. These two budget components are treated differently by corporate accountants for tax purposes. The G&A budget is usually used for regular operations and break fixes within IT. Everyone’s salaries come out of it. Fixing your laptops and air conditioning bill for your Data Centers come out of it. On the other hand, the Capital component of the budget is for building new things. For example, if we want a new billing system or if we want to upgrade the back-bone for a call center, the required funds come out of capital budgets. The capital component for building a new billing system cannot be estimated as accurately as the salary you are going to pay for a programmer that has been with the company for some years. This is because there are components that are new and unknown. Project Architecture supposed to untangle
