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How can you track cloud and hybrid environment costs?

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Cloud and hybrid environments offer many benefits for businesses, such as scalability, flexibility, and cost-efficiency. However, managing and monitoring these environments can also pose some challenges, especially when it comes to tracking and optimizing the costs of cloud services and resources. In this article, you will learn how to track cloud and hybrid environment costs using some best practices and tools.

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Anand Kumar Sinha

CIO & Global Head IT @ Birlasoft | MBA, ITIL Certified
Ted Stavracos

Vice President Infrastructure/CISO | MBA, CISSP…
Lekeke Mahlo

Global Advisor Web Experience | Data Driven Marketing | eCommerce Enhancement

1 Understand your cloud billing model

The first step to track your cloud and hybrid environment costs is to understand how your cloud provider charges you for the services and resources you use. Different cloud providers may have different billing models, such as pay-as-you-go, reserved instances, spot instances, or subscriptions. You should also be aware of the factors that affect your cloud costs, such as data transfer, storage, network, compute, and security. By understanding your cloud billing model, you can identify the sources of your cloud expenses and plan your budget accordingly.

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Lekeke Mahlo

Global Advisor Web Experience | Data Driven Marketing | eCommerce Enhancement
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Effectively tracking costs in a cloud and hybrid environment requires a combination of tools, strategies, and a proactive approach. By monitoring, analyzing, and optimizing your cloud spending, you can achieve cost efficiency and ensure that your resources align with your organization's budget and objectives. #LeadershipDevelopment ??????

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Dr Onyinye O.

Founder & Executive Director @ Supporting Advocacy for Vital Empowerment Foundation | Technical Writer | Product Manager | IT Governance | | WTM Ambassador | Public Speaker | Tech Event Organizer| Host
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To grasp cloud provider charges, learn about On-Demand Instances, Reserved Instances, Savings Plans, and cost-saving mechanisms. It's important to understand the concept of Resource Groups, which help organize resources.

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Anand Kumar Sinha

CIO & Global Head IT @ Birlasoft | MBA, ITIL Certified
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Tracking cloud and hybrid environment costs is like managing your household expenses. Set a budget, categorize spending, monitor usage, use cost monitoring tools, get alerts for overspending, optimize your services, and regularly review to make sure you're on track. It's about keeping a close eye on your cloud expenses to avoid overspending, just like you'd watch your home budget.

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Muhammad Ahmer Imam
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In today's digital landscape, organizations are increasingly relying on cloud and hybrid environments to meet their IT needs. However, as these environments grow in complexity, tracking costs becomes paramount. In this article, we'll explore the various aspects of tracking costs in cloud and hybrid environments and why it's essential for efficient budget management.

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Dave Pascarella

Director CCOE - State of Maine | Cloud & Multi Cloud
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Have a FinOps model consisting of people across the organization from the cloud engineer, to operation leadership to finance personal. Use existing toolsets to set budgets, create alerts and review cost. Having open conversations regardless of where a workload is placed around cost expectations. This will help when cost deviate from intended spend, allowing this team to really dig in on what increased drivers are.

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2 Use cloud cost management tools

The second step to track your cloud and hybrid environment costs is to use cloud cost management tools that can help you monitor, analyze, and optimize your cloud spending. Cloud cost management tools can provide you with visibility into your cloud usage and performance, as well as insights into your cost trends and patterns. Some examples of cloud cost management tools are AWS Cost Explorer, Azure Cost Management, Google Cloud Billing, or third-party solutions such as Cloudability, CloudHealth, or CloudCheckr. These tools can help you track your cloud costs across multiple accounts, regions, and services, as well as provide you with recommendations and alerts to reduce your cloud waste and inefficiencies.

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Dr Onyinye O.

Founder & Executive Director @ Supporting Advocacy for Vital Empowerment Foundation | Technical Writer | Product Manager | IT Governance | | WTM Ambassador | Public Speaker | Tech Event Organizer| Host
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Take advantage of tools like AWS Cost Explorer, Azure Cost Management and Billing, and Google Cloud Cost Management to visualize and analyze your costs. Using third-party cost management and optimization tools like CloudHealth, CloudCheckr, to provide more advanced features and analytics can also be used.

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3 Implement cloud cost governance policies

The third step to track your cloud and hybrid environment costs is to implement cloud cost governance policies that can help you control and optimize your cloud spending. Cloud cost governance policies are rules and guidelines that define how your organization allocates, manages, and reports its cloud budget and resources. Some examples of cloud cost governance policies are setting cost limits and thresholds, assigning cost ownership and accountability, enforcing tagging and naming standards, and automating cost optimization actions. By implementing cloud cost governance policies, you can ensure that your cloud and hybrid environment costs are aligned with your business goals and objectives.

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Dr Onyinye O.

Founder & Executive Director @ Supporting Advocacy for Vital Empowerment Foundation | Technical Writer | Product Manager | IT Governance | | WTM Ambassador | Public Speaker | Tech Event Organizer| Host
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I am thrilled by the world of governance and policies. So I would advise you to define cloud governance policies and enforce them with tools and automation. Policies can dictate which resources can be created, specify naming conventions, and implement cost control rules.

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4 Optimize your cloud and hybrid environment performance

The fourth step to track your cloud and hybrid environment costs is to optimize your cloud and hybrid environment performance. Optimizing your cloud and hybrid environment performance means ensuring that your cloud services and resources are delivering the expected value and quality for your business needs and users. Some examples of optimizing your cloud and hybrid environment performance are scaling up or down your cloud resources according to demand, choosing the right cloud service and resource types, leveraging cloud-native features and services, and improving your cloud security and reliability. By optimizing your cloud and hybrid environment performance, you can not only enhance your cloud efficiency and effectiveness, but also lower your cloud costs and risks.

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Ted Stavracos

Vice President Infrastructure/CISO | MBA, CISSP, PMP, CRISC
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Optimization before during and after is key to containing expenses. The cloud is wonderful but pricey and sometimes the value you get out of it comes from availability and reduced administration, not data center savings. Know that going in and use metrics that are relevant. Prior to moving have an estimate and compare after the first phase to get a read on what the completed costs will be. If you are using a partner don't assume the cost estimator used is accurate. Turn down cycles when they are not in use and throttle where performance is not important. Don't forget to include cloud costs into new projects and deployments and to remove cloud objects as you retire them.

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5 Review your cloud and hybrid environment costs regularly

The fifth step to track your cloud and hybrid environment costs is to review your cloud and hybrid environment costs regularly. Reviewing your cloud and hybrid environment costs regularly means checking and verifying your cloud bills and reports, as well as evaluating your cloud cost management performance and outcomes. Some examples of reviewing your cloud and hybrid environment costs regularly are comparing your actual cloud spending with your budget and forecast, identifying and resolving any cloud cost anomalies or errors, measuring and reporting your cloud cost savings and benefits, and updating your cloud cost management strategy and plans. By reviewing your cloud and hybrid environment costs regularly, you can ensure that your cloud and hybrid environment costs are accurate and transparent, as well as improve your cloud cost management maturity and capability.

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Dr Onyinye O.

Founder & Executive Director @ Supporting Advocacy for Vital Empowerment Foundation | Technical Writer | Product Manager | IT Governance | | WTM Ambassador | Public Speaker | Tech Event Organizer| Host
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If you have a hybrid environment (combining on-premises and cloud resources), use tools that can monitor both environments and aggregate cost data.

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6 Learn from other cloud and hybrid environment users

The sixth step to track your cloud and hybrid environment costs is to learn from other cloud and hybrid environment users. Learning from other cloud and hybrid environment users means seeking and sharing best practices, tips, and experiences on how to track and optimize cloud and hybrid environment costs. Some examples of learning from other cloud and hybrid environment users are joining and participating in cloud communities and forums, attending and hosting cloud webinars and events, reading and writing cloud blogs and articles, and consulting and collaborating with cloud experts and peers. By learning from other cloud and hybrid environment users, you can gain new insights and perspectives, as well as discover new opportunities and solutions for your cloud and hybrid environment costs.

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Anand Kumar Sinha

CIO & Global Head IT @ Birlasoft | MBA, ITIL Certified
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Cost management in cloud and hybrid environments parallels effective financial stewardship. Initiate by establishing a clear budget, categorizing expenses with precision, leveraging monitoring tools, instituting alert mechanisms, optimizing resource allocation, and conducting periodic assessments for fiscal efficiency. This meticulous approach guarantees responsible spending and resource optimization within a professional context.

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7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Dr Onyinye O.

Founder & Executive Director @ Supporting Advocacy for Vital Empowerment Foundation | Technical Writer | Product Manager | IT Governance | | WTM Ambassador | Public Speaker | Tech Event Organizer| Host
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Apply resource tags to your cloud resources to categorize them by project, department, or application. Tags help in cost allocation and show where resources are being utilized. Identify underutilized or idle resources, and take action to rightsize or terminate them. This may include using auto-scaling and shutting down unused instances. Ensure that teams and stakeholders are aware of cost management goals and best practices. Encourage them to follow cost-saving measures. Using serverless and containerization technologies like AWS Lambda, Azure Functions, and Kubernetes can lower costs by adjusting resources according to usage.

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How can you track cloud and hybrid environment costs?

1

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4

5

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7

1 Understand your cloud billing model

2 Use cloud cost management tools

3 Implement cloud cost governance policies

4 Optimize your cloud and hybrid environment performance

5 Review your cloud and hybrid environment costs regularly

6 Learn from other cloud and hybrid environment users

7 Here’s what else to consider

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How can you track cloud and hybrid environment costs?

1

2

3

4

5

6

7

1 Understand your cloud billing model

2 Use cloud cost management tools

3 Implement cloud cost governance policies

4 Optimize your cloud and hybrid environment performance

5 Review your cloud and hybrid environment costs regularly

6 Learn from other cloud and hybrid environment users

7 Here’s what else to consider

Information Technology

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