Intranet cost and procurement: getting the budget right

An intranet budget is usually discussed as a single number: the monthly per-user licence. That number is typically less than half of the total. Getting the budget right matters at least as much as choosing the vendor.

The line items of total cost of ownership

Over a three-year horizon, write these out separately:

1. Licence. Monthly or annual fee per user. Annual payment usually discounts by about two months' worth.
2. Setup and configuration. Brand colours, module selection, the department tree, initial content.
3. Data migration. Moving documents and announcements from the old portal. Past a few thousand documents this is a project of its own.
4. Training. Content training for editors, a short introduction for everyone else.
5. Internal effort. The most commonly forgotten line: who keeps the content current, and how many hours a month that takes.
6. Integration work. SSO, directory matching, ERP connections.

The fifth line is usually the biggest surprise. Eight hours a month of content ownership is 288 hours over three years; a budget that doesn't record that as a cost is incomplete.

Comparing pricing models

Per user is transparent but grows linearly with headcount. Tiered packages look cheap for small companies and jump sharply at the tier boundary. Per module looks fair on paper; in practice it is hard to predict before rollout which modules will actually be switched on.

Two questions settle most comparisons: do you pay for modules you don't use, and at what threshold does the price step up? We publish our own model openly, per user and monthly or annual, on the pricing page.

How many licences should you buy?

A common mistake is licensing the whole headcount in year one. Licences bought for field and frontline teams before their use is confirmed are wasted. A healthier path is to start with a pilot group and expand after three months. That also matches the natural rhythm of your rollout plan.

What not to skip during procurement

• A demo with your own scenario. Your real work, not a prepared flow.
• Security and compliance documentation. Where the data is held, how tenants are isolated, who the sub-processors are. Our security page starts with these answers.
• A reference call. Not with the reference the vendor prefers, but with a customer of comparable size.
• Exit terms. In what format and within what period your data is handed back when the contract ends.
• Service levels. Who you reach, and how quickly, when there is an outage.

Budgeting the pilot

A pilot is the most efficient part of the budget because it removes uncertainty. Twenty to forty people, three modules, three months — that produces both real usage data and internal advocacy. At the end, measure three numbers: weekly active user rate, announcement read rate, and the change in repetitive questions reaching HR.

While listing costs, also estimate the cost of doing nothing: the hours spent chasing processes by hand today, the documents that go missing, the questions asked again and again. When the comparison is made between a licence fee and an implicit assumption that the current state is free, the picture is not honest.

Contract and renewal

What happens in years two and three matters as much as the first-year price. Three clauses are worth settling: the cap on annual increases, whether licence counts can be reduced if headcount falls, and how new modules are added to the existing agreement.

Contracts where the user count can only flex upwards create a real cost difference for companies with seasonal staff. In retail and manufacturing that clause often matters more than the headline price.

The currency is a risk of its own: a contract in a foreign currency ties your budget to exchange-rate movement. An agreement priced in your local currency makes three-year planning predictable even when it comes to the same figure today.

How do you defend the return?

Business cases presented to management often end with something unmeasurable like "communication will improve". Use three concrete items instead: the reduction in time spent finding information, the drop in repetitive HR questions, and the hours saved by digitising processes tracked on paper. All three are measurable during the pilot.

With the budget frame settled, our selection guide helps you build the vendor shortlist — and you can always ask us directly.