SOPs for Cloud Cost Optimization

As companies migrate to the cloud, cost optimization has become a necessity to keep a track of the costs incurred in cloud computing. A cloud computing optimization plan can help in paying off the cloud migration expenses and is essential for businesses to optimize and take advantage of cost and work-related benefits like reduced cloud expenses, increased productivity, and migration of further activities from on-site infrastructure to the cloud.

What is cloud cost optimization?

It is a mix of strategies, techniques, tools & best practices to reduce cloud computing costs while maximizing the business value of using the cloud.

Cloud optimization helps upgrade cloud efficiency by identifying and reducing excess resources and aligning the computing resources to specific applications and workloads in the cloud environment. Simply put, cloud optimization is the process of reducing the overall cloud expenses by identifying mismatched resources, eliminating resource wastage & balancing requirements to ensure that applications can work efficiently and economically. Cloud optimizing is also about aligning cloud expenses with the business goals of the organization.

Best practices for cloud cost optimization:

• Account monitoring - By setting up account monitoring, the costs associated with member account usage can be filtered into one master account which can be routinely checked and audited for usage costs. Capturing context costs assists in tracking the system in context to tie the billing costs to usage. By monitoring these costs over time, billing and cost anomalies can be identified.

• Setting budgets - Costs are overlooked quite often during the development and launch of new products. To ensure cost optimization, cost factors should be looked at every stage of the product development cycle.

o In the planning stage, the teams should be able to justify the budgets and make a project roadmap to enable them to reduce unexpected expenses and adjust the budget where necessary.

o Deployment and operation stage, where the teams should be able to identify unbudgeted expenses and adjust.

o In the design and build stage, the teams should be able to take optimized and cost-effective decisions regarding infrastructure.

o The monitoring stage is where the costs are assessed and operational expenses and ROI can be reported.

• Identifying unused or unattached resources - Unused or unattached resources are obvious and the easiest costs that can be eliminated, resulting in cost optimization. A common use case is when a temporary server is set up to perform a function and then is not turned off after the job is finished resulting in running costs versus zero utilization or revenue. Or forgetting to remove the storage attached to instances that are terminated, leading to continuous billing without revenue generation.

Such instances result in the organization getting billed for resources that it's no longer using but is tied to. Identifying such instances and removing them can be a part of the cloud optimization strategy.

• Identifying and consolidating idle resources - Addressing costs attached to idle resources helps in the cloud optimization process. For example, an idle computing instance might utilize the CPU at a fractional level, but the billing by the cloud provider to the organization will be for the full utilization. The cost optimization strategy would be to identify and consolidate the use of such resources.

Cloud computing offers autoscaling, load balancing & on-demand capabilities that allow organizations to scale and use the computing power as needed.

• Utilizing heat maps - Heat maps can help optimize cloud costs. It's a visual tool that can show increases and decrease in resource utilization and computing requirements. This can be a valuable tool in establishing a start-and-stop routine to reduce costs. Servers can be automated to schedule start-stop routines to optimize costs.

• Rightsizing computing services - Upgrading or downgrading existing cloud infrastructure to balance and meet the required demand for computing services is an essential step in cloud optimization. Besides optimizing costs, rightsizing can also help in achieving peak performance

• Spot instances - Spot instances or spare compute capacity are offered by cloud providers at a lower rate than on-demand instances. These can be purchased in auctions and are available for immediate use. These are best suited for particular cases like batch jobs or jobs that can be terminated quickly.

• Making cost optimization a de-facto normal - Creating and nurturing a cost-conscious culture is essential for cost optimization within the organization. Standardizing the best practices for operating on the cloud, creating an SOP & making teams responsible and accountable leads to a continuous and consistent cost optimization process.

Cloud computing offers great potential and savings, using an SOP and best practices can help in cost optimization in a better way. Cost data that is connected to individual features, events & teams can help in understanding cost spikes without searching for the causes. A Microsoft Azure consulting firm can help businesses with efficient adoption and usage of Azure cloud services along with Azure-based development and Azure environment optimization services.