Great that you want to manage your cloud spend. After reading this article you will know the best way to maximize the business benefits of your cloud computing. Transform your “cloud spend” to “cloud investment”.

You can manage your cloud spend by:

  1. Create a culture of cost awareness
  2. Embrace a cultural practice like FinOps to manage your cloud spend
  3. Manage your cloud spend in relation to business goals
  4. Make sure you have the best-of-breed tooling
  5. Automate where you can
  6. Use reserved instances if possible
  7. Pick the right size of resources in relation to the load
  8. Highlight unassigned costs and assign them
  9. Make software licensing spend in the cloud a separate topic

1. Create a culture of cost awareness

Managing your cloud spend is not only about the best cloud cost management software or about a manager. Cloud has the advantage that you can shorten the time-to-market, because you can start your new functionalities within seconds. And you only have to pay-per-use. You want to keep this advantage, but want to manage the risk of spending money without getting business value (=cloud waste). 

Create a culture in which you make people cost-aware and responsible to manage their cloud spend

Making people responsible doesn’t make it happen. You need to train and/or coach them and let them report about their performance. 
For many people reporting feels like a none-trust in people. But it isn’t. Reporting, can be a very small document/demo, helps people to receive (positive) feedback and so grow in what they do.

Some companies share, besides the (cloud) costs the top -and bottom line as well. These companies saw that employees are more intrinsically motivated if they see the result, on the bottom-line, of their activities.

2. Embrace a cultural practice like FinOps to manage your cloud spend

Your (multi) cloud strategy has an impact on your entire organization. The (multi) cloud landscape is often large with multiple vendors, with different contracts, technology, and often different internal teams as well. 

Create a centralized FinOps-team that does all the general cloud cost management activities, like; contracting, determine the policies and procedures, creating (reporting) templates and organizing knowledge sharing.

3. Manage your cloud spend in relation to business goals

Cloud Cost Management and – cutting won’t be successful if you only focus on the costs part. You should focus on the business outcome of these costs. Making (acceptable) costs for something that delivers a lot of business value isn’t bad. To achieve this you need to have a clear focus on what you want to achieve with the right key performance indicators.

Allocate and label your cloud costs from a business perspective so you can make the right business decisions

4. Make sure you have the best of breed tooling

Managing your (multi) cloud spend without the right tooling costs a lot of time and money. The big cloud providers have native cost management tools which you should use, but … these tools are not sufficient. These native tools have; only basic functionality, still use the technical unclear categorization of costs and don’t have the options to combine the data of other clouds or on-prem solutions.

Research shows that third-party multi cloud best-of-breed cloud cost management software is used to get real business insights. This kind of software focuses only on multi cloud cost management and so delivers the best functionality for the best price, within the shortest time to market

This cloud cost management software collects the data from multiple cloud providers, combines the data in one data model, and visualizes the data. You can label and allocate your costs to business entities, manage your unassigned costs, and share the data with stakeholders.

5. Automate where you can

By implementing automation you can really use and pay for resources only when you need them. By using principles like infrastructure as code and auto-scaling you only start a resource if you need it and you stop it if you don’t need it anymore. If a resource is running and you will need more or less computing power, it will automatically scale up or down if a certain threshold is met. 

6. Use reserved instances if possible

Reserved instances are reserved usage of resources for a longer period of time for a discounted price.

7. Pick the right size of resources in relation to the load

Make sure you are not overprovisioned. The size of your resources, including storage, depends on the load that you need. The load can be influenced by the load on the environment or the load that the application needs, so the code. Evaluating the used resources can give new insights that another, cheaper, size of workload is more than enough

8. Highlight unassigned costs and assign them

By highlighting the unassigned costs you see which resources are used but not assigned to a certain cost center. As mentioned earlier the cost centers themselves need to take the responsibility to manage their own cloud spend. By reducing the unassigned costs you make sure there aren’t costs nobody is taking ownership of.

9. Make software licensing spend in the cloud a separate topic

Having a good overview of your licensing spend in the cloud is hard. Make sure your teams have software licensing on their agenda to manage only what is needed to meet your business goals.

Good luck with managing your cloud spend!

Please feel free to request a demo or trial of the C-Facts best-of-breed cloud cost control center to get the best cloud cost optimization tool from a business perspective.

Read also our blog about “What to take into account with cloud bursting” or “Does moving to cloud save money“?