Cloud Cost Optimization

By: Brad Parks

In addition to increased flexibility, accessibility, availability, scalability, and more, one of the most attractive benefits of embracing cloud computing is supposed to be reduced costs and increased ROI. In fact, Nucleus Research reports that the average return on cloud deployments is 4.01 times the ROI of traditional on-premises solutions and that the cloud allows organizations to recover their investment 2.5 faster than on-premises options. In theory, cloud cost optimization should be one of the main benefits of switching to cloud platforms.

Unfortunately, many enterprises flocked to the public cloud without taking time to think about the what and why. Random acts of lifting and shifting resulted in massive cost overruns and blowback on public cloud use. At the same time, the costs associated with building private cloud and VMware-based infrastructures are often hard for enterprises to quantify.

If you are finding yourself unhappy with your public cloud ROI and looking to understand on-prem cost accountability, then consider these best practices for hybrid cloud cost optimization:

  1. Incorporate Cloud-Cost Analytics for Cloud Cost Optimization
    The first step to reducing cloud spend is identifying where costs are occurring. Many public cloud providers are more than happy to help, by providing cloud-cost management services to help you develop an accurate picture of what services and resources are costing what amounts, and when. Analytical data may include computing demand over time, resource usage, observed spending, etc.

    Backed by the right analytical data, you’ll be in a better position to evaluate your current cloud costs, and determine where cloud cost optimization needs improving. Be sure you apply a common analytics approach to on-prem and multiple public clouds to avoid islands of data.  Morpheus provides a cross-cloud cost approach to cloud costing to eliminate the need to jump between cloud portals.

  2. Identify and Eliminate Unused Resources
    Cloud services tend to operate using an on-demand pricing model. Purchasing and paying for cloud services as needed has the potential to reduce overall spend, but can come back to bite you when unused resources get lost or forgotten.

    Should users or departments within your business set up temporary cloud functions to meet specific jobs, and then forget to discontinue those services, you may be paying for them without realizing it. Stranded storage volume is a common example. Many users will delete a VM but not the attached storage. Public cloud providers then continue to happily charge for those storage buckets – not exactly best practice for cloud cost optimization.  

    Early in your cloud cost optimization strategy, review your charges line by line, and remove any unused resources that you might no longer need, but are still paying for. It’s helpful to have a common database schema across multiple clouds so you’re not managing cloud spend by spreadsheet. Morpheus gives line item detail and attaches cloud resources to specific applications to improve visibility.
  1. Rightsize Your Cloud Services
    Eliminating unused cloud resources is a step in the right direction, but to truly optimize your cloud spend, you need to ensure that your cloud deployment is the most efficient size for your needs.

    Start by determining your peak resource consumption to determine approximately how much cloud capacity you need, and then take a close look at the resources you are currently paying for. Eliminate improperly utilized assets, to reduce your charges in the process. Rightsizing should be an ongoing task, continually improving your cloud services for better efficiency, performance, and cloud cost optimization.

    Morpheus can inventory all of your on-prem and public cloud instances, apply analytics to efficient use of resources, and then recommend guidance to rightsize CPU, memory, and storage’ reducing cloud cost by 30% on average.
  1. Root out Shadow-IT
    It’s estimated that as much as 20% ‘ 40% of enterprise technology funding is spent on projects managed outside of, and without the knowledge of, the IT department. This ‘Shadow IT’ can significantly increase cloud spend when employees sign up for and use company cloud resources for personal use. Shadow IT not only increases cost, but because it represents unaccounted-for and often un-vetted data access, it may also create major security risks.

    Educating your workforce about the dangers of shadow IT, while also soliciting employee feedback to determine where your cloud solutions may be lacking, can help decrease the likelihood of unauthorized cloud usage. However, it is also recommended that you perform an audit to track cloud spending and identify and block any unsanctioned apps within your cloud environment. 

    Morpheus eliminates shadow IT by putting all users under a single role-based access model so you can track the who, what, when, and where of hybrid cloud use. Morpheus can also apply budget and resource policies so teams only provision what is right for their use case.
  1. Use Heat Maps and Policy to Identify Low-Use Times
    Cloud cost optimization requires a clear idea of cloud-computing demand in your organization. Heat mapping can provide a visual representation of when your cloud services see their most heavy use, and when they may be going underutilized.

    With this information, you can determine whether any of your services can be shut down at specific times without disrupting important services. Identifying idle resources and configuring schedules to help keep them running only when you need them will reduce the amount you pay for services you are not currently using. 

    Remember, public cloud providers are happy to charge you for applications when your developers are sleeping. Morpheus has out-of-the-box heat maps and shut down policies to make sure you are only charged when teams are actively using services.
  1. Consider Reserved Instances and Spot Instances
    On-demand is the most common pricing model among cloud vendors, but it’s not the only option. Reserved instances allow businesses to enjoy significant price discounts on cloud services, in exchange for committing to (and paying for) specific computing capacity across a predetermined period of time. Paying in advance can reduce overall spend for organizations with steady workloads, who don’t anticipate having to quickly scale up or down to meet changing needs.

    Spot instances are another alternative to on-demand pricing. Some cloud-service providers auction off spare computing capacity at reduced rates, allowing businesses to pick up cloud services for well below the market price.  Morpheus can poll public cloud costing APIs and provide insight into recommendations for reserved instances and savings plans. Letting you optimize in the same platform that you use for provisioning.
  1. Look into Volume Discounts with Individual Vendors
    Organizations may prefer to work with multiple cloud vendors in an attempt to avoid vendor lock-in, while also cherry-picking the best possible providers for specific specialized services. However, some vendors offer increased discounts for higher-tier clients, rewarding those who spend more with them.

    Likewise, the added administrative responsibilities and the associated costs that come from trying to manage a multi-cloud solution may be adding to your overall cloud spend. If you are working with more than one cloud provider, take a look at what the solution may be costing you and whether your preferred provider might offer discounted services should you decide to work with them exclusively.  At the end of the day, multi and hybrid clouds are a reality but picking the right provider for the right workload is important to manage at scale.  You can benefit from enterprise agreements with select providers. Morpheus can pass through that EA pricing to give true price visibility and improve your overall cloud cost optimization.
  1. Make Cost Awareness Part of Your Culture
    Cutting cloud expenses is not strictly the responsibility of IT and finance leadership; it should be the obligation of the entire organization. Every employee who works within the cloud or depends on cloud-based resources has a stake in cloud cost optimization. As such, organization-wide buy-in for your optimization strategies helps ensure success.

    Identify responsibilities in terms of rightsizing your cloud services, help users understand the dangers of shadow-IT, look for feedback related to usability and demand, and make cost optimization a priority among all stakeholders.  Morpheus can provide business users and development teams with real-time visibility of cloud costs at the time they provide services. This helps teams make smart choices, particularly when implemented along with Morpheus budget policies.
  1. Invest in a Reliable Hybrid Cloud Application Orchestration Tool
    The right analytics, reporting, and cost-management tools can make a major difference in how much you spend on your cloud solutions. The Morpheus platform provides a centralized platform designed for optimal hybrid-cloud application orchestration. Enabling enhanced automation, logging, reports, and analysis, Morpheus is a cost-analytics engine that takes a granular view of cloud costs across your organization to help you make informed decisions and get more out of your cloud solution for less.

Click here to learn more about how Morpheus can help you optimize cloud costs, and start enjoying the increased ROI that has made cloud computing such a phenomenon in modern business. You can also request a demo and have a cloud cost optimization conversation with one of our automation experts.

Request a demo today!

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