How do I Gain a Clear View of Costs in AWS and Azure & Stop Getting Surprises?

Steve Rastall (Founder & CEO) 18-Nov-2024 15:19:07

Cloud Cost Optimisation AWS Cost Management Azure Cost Management

Abstract

The cloud has grown to become an integral part of modern business, facilitating greater agility, flexibility, speed, and innovation. But the subscription service model is something which causes many organisations significant problems with unpredictable costs and unnecessary over spending.

In this article, we explore the common issues with cloud cost management and provide guidance for gaining greater visibility and control over your cloud spend.

Main Article

In recent years, businesses have experienced a demand for greater flexibility and agility in their IT systems, which has driven increased investments in cloud technology.

And, as we all know, the necessity of remote working during the COVID-19 pandemic has taken that cloud adoption to another level in 2020 and 2021. This is only set to continue, with Gartner forecasting the global public cloud services market to reach $397.4 billion in 2022.

This is because organisations, of all sizes across all sectors, must now be able to facilitate mobile and home-based working, as well as seamless collaboration across multiple locations and time zones for their internal users. Furthermore, businesses are also under ever-increasing pressure to deliver outstanding services and experiences to their customers, with unprecedented speed and convenience, across a variety of digital channels.

Migrating IT infrastructure to the cloud has made all these things possible, as well as cost-effective. The cloud provides a wide range of advantages, most notably that it is highly flexible and highly scalable. However, those strengths can also directly feed into the cloud’s greatest challenges, one of which being the issue of controlling cost.

A lack of visibility and control over cloud spending is a problem that we see many organisations falling victim to today. So, let’s answer the key question – how do you maintain sufficient visibility, and control costs, with AWS and Azure?

Understanding the Problem

When migrating your IT infrastructure to the cloud, in the early stages the costs will usually remain aligned with your expectations, and so your budget is adhered to. This is the part that often goes smoothly for most organisations at first, but only at first.

The key thing to understand is that a cloud subscription is one that will change based on its usage, and many other variables.

You’ll likely see that when the number of users grows, or new features are added to your applications, costs will inevitably rise. Unfortunately, if you aren’t aware of this from the start, you won’t find out until that unexpectedly large bill arrives.

Even a simple deployment with only a few instances can potentially have hundreds of line items associated with it when the bill comes at the end of the month.

Delivering business-critical applications and services in the cloud is all about scale and agility, but those attributes make it extremely difficult to monitor and control costs for the average organisation. And doing that properly requires a tremendous amount of time, effort, and dedication.

But you deserve to be able to focus on delivering high quality services and experiences to your end users, and running your business efficiently and effectively, rather than worrying about the management and cost of your IT system. So, let’s explore further to help you solve this problem.

Common Pitfalls and Challenges with the Cloud

As you begin to use and grow your cloud infrastructure, things inevitably begin to become more complex, costly, and challenging.

This may include:

Unexpected bills with greater costs than forecast, sometimes thousands of pounds even for small deployments
Opaque billing and a lack of clarity into cloud usage
Hidden line items that are difficult to track back to your deployment
Costs continuing to rise each month without any control
Paid-for resources going to waste and causing unnecessary spending
Lack of clarity and accountability between different departments.

If you too have encountered problems like these, you are not alone. In fact, in a recent report, Gartner estimated that a staggering 70% of cloud costs are wasted.

Whether you have an Amazon Web Services (AWS) or Microsoft Azure infrastructure, it’s equally difficult to achieve visibility and manage your costs unless you have the proper processes and expertise in place.

This will be even worse if your organisation is large enough to have several different departments and business units using your cloud systems. At the end of the year, it could be difficult for the finance department to determine who should actually be charged for specific spending, because it wasn’t pre-agreed when deployed.

How this Over-Spend Happens

The logical question to ask here is, why and how are the costs of cloud implementations so unpredictable?

As mentioned, the cloud’s flexibility and scalability naturally lend themselves to fluctuating levels of usage, which will cause costs to go beyond those you budget for when first configuring the systems. You may quickly experience:

Growth in the volume and frequency of your cloud implementation’s usage
Growth in the number of users
Over-use of a system that isn’t configured or sized properly.

All these things will happen under the radar, and unfortunately there’s no incentive for Microsoft or Amazon to warn you about it. Because you’re paying for the cloud as a monthly subscription, it needs to be managed extremely carefully. Acclimatising to this concept causes problems for a lot of businesses.

For example, while the nature (and value) of a cloud system is that flexibility – meaning it can be scaled up or down, or have certain components turned off and on at will – many organisations make the mistake of simply leaving it and letting it run.

It’s also wise not to rely on your existing software developers or IT managers to take the task of migrating and managing your cloud. This can turn out to be a costly mistake, as they often misunderstand or underestimate the way a cloud implementation actually works once deployed. This can result in incorrect configurations, or live systems which aren’t monitored properly, which will cause even more over-spending.

Approaching your cloud implementation in these ways will continue to produce unwanted surprises on your bill at the end of each month, and that will have a damaging impact on your organisation.

This makes its way up to board-level very quickly, and can become a huge problem, but is avoidable with the right knowledge, planning, and tools.

And it’s also important to realise that avoiding these challenges will in turn allow you to maximise the value and ROI you gain from your cloud implementation.

Easing and Overcoming the Challenges

In order to overcome challenges with cloud cost management, first you must gain full visibility and understanding of your cloud spend.

Additionally, it’s also crucial to be proactive, rather than reactive, in continuously optimising the usage of your cloud systems.

You must also aim to identify and remove those hidden line items which are driving your cloud spend too high. To do this, you should have processes and tools in place to ensure you are regularly:

Monitoring
Measuring
Reporting
Reviewing
Analysing
Optimising

This will make it far easier to control costs, which will allow you to make better decisions, free up time and resources, and begin forward-planning for future growth and success.

And, perhaps most importantly, you should look to create a culture of awareness and accountability over the budget and spend of your cloud implementation.

Our Advice

To better manage the cost of your cloud infrastructure, you should always first assess your requirements carefully and make sure you fully understand your cloud specification.

Some key questions you should be asking are:

How much storage do you need?
How much data and bandwidth will you use?
How much resource is required?
How many users will you have?
Who will be using what?
When and where will they be using it?
Who is responsible for what?

You should look to provision only what’s required. This is so important, but doesn’t happen without the right strategic approach and careful management. Neither of those are possible without clear visibility.

Beyond that, ensure that you have those monitoring and analysis tools as a priority within your strategy to control any potential rises in cost as you scale-up.

And, as mentioned, be proactive and predictive to prevent unnecessary costs arising, rather than waiting to see what’s on your bill at the end of the month. Otherwise, you’ll regularly suffer charges well beyond what you expect or have budgeted for.

A Word on Automation

At this stage, you’re probably thinking to yourself that all these steps and processes are far too time-consuming, almost warranting a full-time role to be done correctly.

Thankfully, there are tools and systems available – some which are even built-in to AWS and Azure – which will ensure these key cloud management responsibilities are taken care of, so you don’t have to worry about keeping a constant eye on your IT infrastructure.

Automation is a valuable component of a successful IT system today. Automation of key processes, such as monitoring and reporting, provides:

Consistency
Reliability
Simplicity
Clarity
Quality

Your organisation should bring together the tools to automate the support and management of your cloud infrastructure. This will not only deliver significant performance improvements and cost savings, but will also allow you to focus on achieving further business growth and innovation.

The Value of Effective Cloud Cost Management

Aside from the obvious financial benefits of lowering costs, and removing the concern of unnecessary over-spending on IT systems, this greater visibility into your cloud costs will deliver a number of additional advantages to your business as well.

If you’re able to achieve this control, the greater performance and service of your cloud applications will drive greater adoption and usage, which will ultimately lead to success and potential for further growth.

Optimisation of your deployment will allow you to leverage the cloud to its maximum value, and harness the full potential of the technology, to gain most ROI possible.

Final Thoughts

When you’ve invested in a cloud implementation, it’s a mistake to simply worry about getting the right specification and configuration to launch, then leaving things to run themselves.

A cloud solution is wasted if you don’t have the flexibility to adapt and evolve, but you can’t do that cost-effectively without full visibility into the system, and management of the associated costs.

Whether you’re a growing SME or a global enterprise, you can’t afford to allow your cloud spend to get out of hand and continue to rise unexpectedly.

Don’t allow your organisation to fall into the all-too-common trap of signing off a cloud investment, getting everything up and running, and underestimating the natural increases in spending which come with greater usage and scale.

Considering a CloudOps Solution

Our very own CloudOps has been developed to solve these exact challenges, leveraging our team’s experience in supporting and managing cloud environments since 2010.

CloudOps brings together performance and cost monitoring tools, support, and general administration through a single portal to manage your cloud. This includes:

Always-on support; fault, find, and fix
Easy-to-use management, monitoring, and reporting dashboards
Proactive infrastructure optimisation
Tools and apps to enhance your cloud performance
Guaranteed cost savings.

This is a proven way to reduce your cloud spend and optimise your infrastructure’s performance. CloudOps can be implemented across any existing or new AWS and Azure cloud environment, allowing you to focus on delivering applications and services, not managing your cloud infrastructure.

Unlike a traditional cloud support contract, CloudOps already includes all the features and functions your business needs without any hidden costs or surprise charges.

Become an integral part of your team, delivering high-quality advice and support
Allow you to concentrate on delivering your own services and applications
Improve overall business profitability and reduce cloud costs
Enable your business to grow through the cloud.