5 Best Practices and strategies for Cloud Cost Optimization

cloud cost optimization

5 Best Practices and strategies for Cloud Cost Optimization

Companies migrate to the Cloud to achieve cost optimization. Paying only for the compute resources without the headache of having to maintain them is the Cloud’s best attraction. This sounds like a good plan, but when you dive headlong into this journey, you realize that it is possible to cut down costs further. Some gain this knowledge through trial and error, and others by learning from the mistakes and learnings of the top enterprises. This article cuts all your hard work and drills down to those five practices or strategies that will help your company achieve Cloud cost optimization.

Cloud Cost Optimization

Before we proceed with the strategies, it is necessary to understand the term “Cloud Cost Optimization.” It is the practice of slashing the overall cloud spend of an enterprise by detecting mismanaged resources, removing waste, reserving or holding capacity for better and more significant discounts, and optimally sizing the computing services to scale.

The problem with most Cloud services is that you pay for booking them irrespective of whether they are utilized or not. So if you book it, you pay for it. Though there are other options as well where you pay only when you use, but the cost associated is slightly higher in that case. So, Cloud cost optimization is all about finding the right mix in terms of SaaS, PaaS, and IaaS.

5 Best Practices And Strategies For Cloud Cost Optimization

1. Identify Idle Resources and Consolidate Them – Idle resources are those that you have paid for and remain unused. Similarly, there could also be unattached resources, those that were used once by the administrator but later forgotten about. These eat into the storage space if not terminated. Their identification is necessary because the company is paying for what it is not using. 

Let us take a small example, the CPU usage for your current operation is 15% to 20% of what you have booked. But when the bill comes from the Cloud services provider, it is for the complete capacity, i.e., 100%. Merging such resources will allow the company to cut costs. Purchasing on-demand and auto-scaling capabilities along with the load balancing feature will allow scaling without having to bear ongoing high costs.

2. Use Heat Maps – Heat map is an extremely useful data visualization tool. You can use it to monitor your Cloud usage and show the highs and lows in your computing demand. The heatmaps are a valuable asset that gives rich insights for cost-cutting. You can fix the start and cut-off points for various resources and also identify those that are lying dormant, and shut them down. 

Heatmaps allow you to automate the stop-and-go schedules for various instances. It means there is no need for manual performance of these tasks, so there are no chances of any mistakes. In turn, it leads to cost optimization.

3. Match Demand And Supply – Until the demand and supply match, you will not achieve cost optimization, which is possible only by right-sizing the resources. Using the appropriate right-sizing tools, every enterprise can now optimize the server size and several other vital components like storage capacity, database, and memory. It will bring in cost reduction with Cloud optimization, which will enable the applications and resources to perform at their peak.

In principle, right-sizing is all about eliminating overprovisioning and finding that point where the Cloud resources will match your company’s demand perfectly. Sometimes it requires tweaking of processes, and sometimes it may call for complete instance changes. You just need to propagate a culture across the company that accepts change instead of resisting it.

4. Think Of Using Multi-Cloud – Many first-time Cloud users and start-ups believe in a single Cloud strategy. It means they use a single Cloud service provider. Today, even amongst the Cloud service providers, the competition is so much that sometimes if you spread out, you can save way more. Different Clouds have different licensing costs. Using a cloud mix will help you avail the best of each service provider and bring down the licensing costs at the same time.

There is also a downside to using a multi-cloud strategy. That being, you may miss reaching that tier where your Cloud provider could give you higher discounts for increased usage. Also, there may be some problems with smooth switching between different Clouds. Therefore, it is a call you will have to make after weighing all your options.

5. Purchase Instances – Even after right-sizing, it is possible to reduce costs further through Reserved Instances and Savings Plans. However, these make sense only for those workloads that are long-running and steady. Sometimes, you can even avail a discount as high as 70% if you bid on spot instances. This, however, is easier said than done even for the most experienced organizations as spot instances have a very small bid window.

What an organization needs at this time is expert help. It is time to bring in Cloud consulting experts who can help the in-house IT team devise a cloud cost management strategy. With their help, it will become easier to uncover more avenues of Cloud cost optimization.

It’s A Wrap

Cloud cost optimization is not an overly complicated process. We are not saying that it is easy either. Nevertheless, you can get surprising results with a disciplined approach, proper planning, and wholesome participation from the employees. A winning Cloud cost optimization strategy is essential, but so is the culture of cost awareness. The two things will work hand in hand to cut down all unnecessary expenses.

Working with an experienced Cloud consulting partner like Oamii Technologies will smoothen your organization’s Cloud cost optimization journey. We have helped many players in your exact position achieve eye-opening positive results. Our team of experienced Cloud consultants can help you get the desired economies quickly without having to go through a long, drawn-out process of learning as you go. Since the Cloud is our forte, we know how to help you make the most of it any time and every time.