5 Ways for Enterprises to Manage Cloud Costs
The cloud is an invaluable resource when it comes to managing workloads at scale. And while, in many cases, the cloud can be cheaper than traditional on-premises infrastructure, IT executives still need to do everything they can to prevent costs from spinning out of control. John Purcell, chief product officer at DoiT International, shares five key ways enterprises can manage cloud costs better.
The ease with which the cloud can be provisioned and integrated into the enterprise data footprint typically makes it the go-to solution for business units trying to fulfill their mandates. Without a firm hand to guide cloud consumption. However, many organizations are finding that the cost of mega-scaled architectures can easily disrupt business and financial models.
A recent survey by MarketsandMarkets showed that growth in cloud computing is not only climbing but is showing no sign of abating. In 2021, the market topped $445 billion, which is expected to double to $947 billion by mid-decade. With expertise in data center management in short supply, organizations will continue to turn to outside cloud providers, managed service providers (MSPs) and value-added resellers (VARs) to meet their needs.
This is why the enterprise needs to get control of its cloud. As more providers and stakeholders participate, and as infrastructure becomes more distributed and difficult to monitor and manage, businesses can find themselves unable to access data in a timely fashion — and without a rapid means to recover lost or stolen data. All of this could produce sudden and detrimental consequences to the business model.
How can the enterprise get the best of both worlds in its cloud spend? Is there a way to preserve its ease of use, virtually limitless scalability and low costs without sacrificing control? Here are five ways to square this circle.
1. Have a Plan
Too often, enterprises engage the cloud without a clear understanding of what they hope to get out of it and how to ensure it meets business goals. Most deployments, in fact, are performed by business units that seek to meet short-term goals like boosting quarterly sales figures or generating financial reports. This can quickly lead to chaos because no one is working to harness the cloud in an integrated fashion, and the IT department, whose job it is to manage infrastructure, is often kept out of the loop.
A well-developed plan to guide cloud consumption in both strategic and operational terms not only produces a better cloud it avoids many of the headaches that can occur with provisioning, migration and other critical tasks. One of the first steps in this direction is to conduct a thorough assessment of anticipated needs, available skills and procedural guidelines to avoid any hiccups that may occur.
There also should be a clear understanding of the shared responsibilities between parties, all listed in the relevant service level agreements (SLAs) and key performance indicators (KPIs).
2. Audit Your Resources
Carefully tracking resource consumption in relation to workloads is one of the best ways to keep costs under control. It is estimated that 40% of cloud-based instances are too large, so monitoring resource utilization helps balance loads across the environment and provides insight into what systems can be decommissioned without hampering overall performance.
A key element in the ability to audit the environment is continuous monitoring. Given the speed at which data moves and the tighter margins that have emerged in response, real-time assessment and analysis of the full data environment is essential.
3. Ensure Proper Governance
Governance is more than just rules and oversight. It requires careful coordination between multiple stakeholders to establish policies for optimizing the entire data stack, from infrastructure design and application monitoring to security, development and programming.
Governance also contributes directly to the main value proposition of the cloud – low cost and high scale. By providing the means to track the cost-benefit of individual projects or services, it acts as a guide to ensure the most efficient means of support. In this same way, governance can help guide future deployments to ensure they do not scale beyond operational needs.
See More: Gaining Data Governance Flexibility in the Cloud
4. Understand the Costs
Increased costs are not always bad. The trick is to match cost with growth to balance operational needs and revenues properly. Sometimes upfront costs are required to drive the growth that will lead to greater profitability over the long term. To manage this cycle effectively, you must have a way to measure not only the costs as they arise but the value they will bring to the business model.
The cloud does not change this principle. In some cases, housing a service on-prem is more cost-effective than provisioning an IaaS environment. And sometimes, the two working in tandem can provide the highest degree of flexibility and control.
5. Leverage Cloud Savings
Most cloud providers offer discounts and other opportunities to lower costs, yet only a fraction of customers take advantage of them. This translates to billions in unnecessary cloud expenses.
Cloud discount programs can enable more flexible scalability because they offer significant capacity up front that can be augmented by, or converted entirely to, an on-demand consumption model at a certain load threshold. The challenge is that these discounts are typically available only with a long-term commitment.
6. Innovation and Savings
It is hard to imagine an effective IT architecture that does not incorporate the cloud substantially. But instead of just “putting it in the cloud,” enterprise executives should focus on driving the best value from the overall IT budget. However, cost optimization will not happen without the means to gain actionable insight into data infrastructure and operations.
In today’s economy, simply throwing technology at a problem and hoping it goes away can no longer cut it. In the future, only those who can maximize the value of their operations will continue to thrive.
Are you applying any cost-saving strategies as your enterprise grows on the cloud? Tell us on LinkedIn, Twitter, or Facebook. We’d love to know!
