5 Proven Cloud Cost Management Tips for Digital-First Businesses of 2021

5 Proven Cloud Cost Management Tips for Digital-First Businesses of 2021

The ongoing massive wave of digital transformation is not going to fade away soon as more organizations turn to digital tools to stay agile, productive, and connected in this highly disrupted landscape. According to IDG Cloud Computing Survey 2020, right now, every 4 out of 5 enterprises surveyed have at least a part of their IT infrastructure or one application on the cloud. The survey predicts that in the next 18 months, approximately 22% of the enterprises will be running entirely on cloud infrastructure and applications. Of all the lessons the global business community has learned from the pandemic, the most important is the risk and futility associated with the dependency on on-premise infrastructure. An invisible infrastructure is going to be the guiding principle for all digital-only organizations.

As companies spend the lion's share of their IT budget on cloud computing in 2021, it is crucial to lay out a strategic approach to get the most out of every dollar spent. An effective cost management starts with an in-depth analysis of the cloud strategy in advance, followed by leveraging the right tools to discover or prevent discrepancies across the system. Our cloud experts at Cloud4C, from their years of experience, have shared the top 5 ways to control your cloud costs, re-align the IT infrastructure, and ensure business continuity.

1. Right-sizing your subscription

Majority of the cloud subscribers often lack clarity in terms of the required cloud usage, for which they end up paying more than necessary. Hence, it is essential to know how many services you will be using. Some of the usage metrics that one consider are-

  • Number of licenses per user
  • Number of servers
  • Space (storage and disk)
  • Number of processes
  • Number and size of database and database queries

A software license management tool can help you track and forecast these usage metrics and prevent overpaying on public cloud services.

2. Daily monitoring

One of the key benefits of public cloud services is the ease and flexibility of scaling. In most cases, developers and other IT departments tend to spin up new instances every day. Hence, if your IT team is monitoring cloud usage on a weekly or quarterly basis, the unexpectedly higher charges can come as a shock. That's why it is always advisable to use a dashboard and monitor cloud usage daily. While some organizations invest in third-party tools for monitoring cloud usage, one can also use the cloud vendors' monitoring tools for little to no cost. E.g., AWS Cost and Usage Report tracks use on an hourly or daily basis. Similarly, Microsoft Azure has Azure Monitor and Cost Management services, whereas Google Cloud Platform comes with Stackdriver Monitoring.

3. Shutting down unnecessary instances

Remember the time when parents used to ask us to check and turn the lights and fans off before leaving a room? Well, the same applies to cloud services as well. Unmonitored and unnecessary cloud resource usage simply adds up to the costs without adding any value to your business. Enterprises often struggle with IT professionals spinning up a new instance and then forgetting to turn it off once the work is done.

A RightScale survey found that enterprises are using automated tools and manual processes to combat this situation. 72% of surveyed companies had taken proactive steps to reduce inactive storage, whereas 71% of organizations have resorted to shutting down workloads after hours. 69% of organizations have specified expiration dates for all the workloads.2

4. Deploy automation

Automated alerts and notifications not only increase accountability company-wide but also offer you the visibility required to optimize your cloud spends. Enterprises are already deploying automation to stay on top of every minute change in the environment and participate in decision-making. Automation can help enterprises gain far better visibility on cost, usage, and performance starting from authorization failures, budget overruns, cost spikes, untagged infrastructure, etc.

According to Lauren E. Nelson, a Forrester analyst, "Many organizations turn to the cloud to reduce spend on infrastructure or avoid steep upfront costs for new investments. Still, many have not achieved these goals. Success depends more on the maturity of cloud management and governance practices than the nature of the workload. With cost complexity continuing to increase alongside growing usage, users, accounts, and instance types, [infrastructure and operations] professionals increasingly depend on tools to enable visibility, consistency, and scalability of management practices." 3

5. Hybrid cost management (HCM) tool for complex environments

The cloud needs of larger enterprises are often more evolved and complex than SMB. In such a complex environment, controlling the cloud's spiraling costs becomes a challenge for the CIO. A hybrid cloud management solution can solve the problem as these solutions tend to combine monitoring and cost management with orchestration, template creation, compliance, brokerage, and other automation capabilities. While these HCM solutions can be more expensive, larger enterprises can benefit from deploying these solutions instead of CCMO solutions.

For more information on cloud cost optimization or get expert advice, Contact us today!

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Team Cloud4C

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