November 29

5 Best Practices for Optimizing Cloud Cost

As the cloud continues to mature, IT decision-makers are faced with ongoing challenges to optimize and control cloud costs. There are many opportunities for cost savings in the cloud, but also many pitfalls that could result in overspending or increased costs that aren’t apparent until much later down the road. Fortunately, there are 5 best practices to follow to ensure you get the most out of your cloud infrastructure while minimizing your spending. Let’s dive in!

1) Put a Cloud Cost Optimization Policy in Place

One of your first steps should be to write down your cloud cost optimization policy, which should outline guidelines on what’s acceptable and what isn’t.  Is it OK to overprovision resources at launch? How quickly do you need to reduce usage when a project comes to an end? What types of resources can be used in development vs. production environments? The more defined these policies are, the better you can manage cloud spend across your company or business unit. Make sure each relevant stakeholder understands his or her role when it comes to implementing your policies—or risk costly missteps.

Your next step should be to conduct a complete audit of all your cloud subscriptions, including third-party providers that may not be included in your master list. For each service, make note of usage levels (in units like gigabytes or processor hours) and any relevant pricing information. You may find it helpful to use a spreadsheet or other tool to keep track of these figures; OneNote is ideal because it allows you to both enter information and calculate totals.

2) Use Cloud Billing Alerts

Getting early warning signs about potential issues is crucial if you want to successfully optimize cloud costs. It’s therefore critical that you set up billing alerts that monitor how much you’re spending and how quickly those costs will rise based on current activity levels. Use billing alerts as a tool to gauge whether your cloud resource allocation and use align with your resource policy (and help ensure that they continue to align). If not, then either adjust those policies or turn off extra cloud features until such time as they become part of future plans (at which point they’ll be turned back on again).

Cloud billing alerts can be set up in a number of ways. In your cloud provider’s control panel, you may find pre-set alerts you can turn on to help keep an eye on spending. Alternately, if your cloud provider offers a monitoring tool you can use to gauge overall resource utilization and spot potential issues before they become problems, it’s wise to leverage those as well.

3) Create Separate Costs Pools Using Cost Management Tools

One of your most powerful cloud cost optimization tools can also be one of your most complex: managing costs through separate pools. With traditional software products, tracking costs by group was simple because you could put each different business unit into its own separate ledger account. With cloud services, that’s rarely possible—which makes separating costs by group all but impossible unless you resort to some advanced software tools. And just like every other advanced cloud management strategy, it takes effort to figure out what makes sense from a policy perspective and what doesn’t—but it’s well worth it in terms of long-term savings for companies who stick with it. 

4) Limit Redundancy Where Possible

Because cloud solutions are so scalable, keeping track of where redundancies exist can be difficult at first glance. To limit redundancy across infrastructure components (and thereby reduce cloud spend), check for high availability functionality built directly into any relevant software packages before creating your account(s). If there is high availability built right in, then avoid additional redundancies that would only increase overall costs without providing any additional value or protection.

If there is not built-in high availability, you can limit redundancy by focusing on software that has built-in failover or load balancing capabilities. Cloud platforms like Microsoft Azure (with its Azure Load Balancer service) and Amazon Web Services (with its Elastic Load Balancers) provide these options, making it easy to eliminate redundancy through standard configurations.

5) Use Volume Pricing Where Possible

A final step on your quest to optimize cloud costs is to utilize volume pricing models whenever they make sense–because more people using something generally translates into lower per-unit prices overall.  Cloud providers typically offer a significant discount when you sign up for recurring service in a certain time period, and these deals can translate into huge savings over time. Just be sure you’re getting a deal that makes sense in terms of what you need; if you’re running mission-critical workloads, it may not always be worth signing up for massive quantities of compute power just because it’s cheap.

Not sure if you’re getting the best pricing, or if you’re properly optimizing your cloud spend? Contact Axeleos today and let us help!


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