To create effective IT budgets and reap the best return on investment, experts say, credit unions must plan ahead, think strategically and partner with reliable vendors.

"The first step is to gain a thorough understanding of the credit union's strategic business plan, and then you must ensure that your IT strategy is updated each year and in sync with overall strategic business plan," said Brad Smith, co-founder and CEO/president of Austin, Tex.-based Abound Resources.

In a recent webinar on "Developing a Technology Strategic Plan that Hits the Target," Smith offered tips that included performing

• a gap analysis against existing technology to identify priorities required to align IT systems with business strategy.
• He also suggested credit unions address the cost-effectiveness of new technology such as cloud-based storage and learn about the FFIEC's 2013 IT audit findings and how to address them.

Creating a strategic IT plan is especially important as an increasing number of members opt for online and mobile services, experts said.

"Credit unions used to have a few years to ponder what was happening in the market, but now we're finding a need for real time lessons and constant evaluation," said Jason Nelson, vice president of development at Red Rocks. The credit union operates only two branches and serves most of its 17,000 members remotely.

"Research done a year ago or 18 months ago has already shifted by the time it comes to bring a new strategic initiative or service online," he continued. "No longer can a credit union identify one clear plan at the end of the year and expect it to remain substantially unchanged. You can't close your eyes once you make an IT decision. You must constantly evaluate and revise."

To navigate the increasingly complicated IT waters, many credit unions, including Red Rock, have turned to managed services.

For example, Paducah, Ky.-based Computer Services Inc. provides remote, around-the-clock monitoring of Red Rocks' network through its Cisco Systems adaptive security appliance, a firewall that's configured with a comprehensive, intrusion prevention system. CSI also manages the institution's servers, online help desk and strategic IT development.

"It's great to have CSI as a partner because it would be impossible to pay someone internally to provide the same level of expertise they offer," Trostel said. "We'll brainstorm with CSI's team and debate: "Is this is the direction we want to go? What is best way to get there? That's an extremely important part of the relationship."

Providing IT planning advice is a crucial part of the partnership, said Dan Holt, president and general manager of CSI's managed services division.

"Credit unions shouldn't have to worry about an infrastructure that holds them back," Holt said. "Many times we find that changing business processes will address inefficiencies without having to purchase new technology. Often the credit unions can utilize existing technology in a more efficient, effective way."

By partnering with CSI, Red Rock has significantly improved the IT planning process and alleviated anxiety related to FFIEC exams, Trostel said.

"One challenge we have resolved over the past few years is identifying what tech we absolutely not want to work with that does not fit our model," she explained. "If you can't virtualize it, we don't want it."

For credit unions suffering IT budget headaches, Trostel offers this advice: "If you don't have internal expertise, seek it out. Credit unions can't think of themselves as a lone wolf. Seek out advice, whether that's through a trusted vendor, CUSO or other credit unions."