How can you ensure predictable cloud costs?

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Cloud computing offers many benefits, such as scalability, flexibility, and agility, but it also comes with challenges, such as unpredictable costs, complex billing, and resource optimization. How can you ensure predictable cloud costs and avoid overspending or underutilizing your cloud resources? In this article, we will share some best practices for cloud cost and resource management that can help you plan, monitor, and control your cloud spending.

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1 Define your cloud strategy

Before migrating to the cloud or expanding your cloud usage, it's essential to define your cloud strategy and align it with your business goals, budget, and performance requirements. This strategy should include a clear vision and purpose for using the cloud, an assessment of current and future cloud needs and capabilities, a selection of the best cloud service model and provider for your use cases, a governance framework and policies for security, compliance, and accountability, a migration plan and roadmap for moving workloads and data to the cloud, as well as a training and education program for staff and stakeholders. By defining your cloud strategy, you can set clear expectations and objectives for your projects, identify potential risks and opportunities, and allocate resources and budget accordingly.

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Mark Kerchenski, MCP

Innovative Business Process Analyst at ODJFS | MS 365 Champion | IT & Security Strategist | Optimizing Operations, Strengthening Cybersecurity
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Ensuring predictable cloud costs involves several key strategies: 1. Resource Planning 2. Budget Allocation 3. Resource Optimization 4. Cost Monitoring 5. Tagging and Accountability 6. Use of Cost Estimation Tools 7. Regular Review and Optimization By implementing these strategies and maintaining a proactive approach to cost management, you can ensure predictable cloud costs while optimizing performance and scalability for your organization.

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Enderson Menezes

DevOps, Automation and Site Reliability Engineering
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In my professional experience, adopting Key Results (KRs) has proven extremely effective for cloud planning and vendor organization. In addition to the strategies mentioned in the article, I strongly recommend looking for Open-Source tools to avoid being locked into a single provider. Choose agnostic services and, if you have the capacity, develop your own solutions. This will make it easier to migrate between different clouds and avoid dependence on a single budget.

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2 Estimate your cloud costs

Once you have your cloud strategy in place, it is essential to estimate your cloud costs and create a budget for your cloud operations. This involves considering the type, size, and location of your cloud resources, the amount of data transfer and storage, the level of availability and redundancy, and the usage patterns and demand fluctuations. To estimate your cloud costs, you can use cloud cost calculators from providers such as AWS, Azure, or Google Cloud Platform. Additionally, you can use cloud cost models such as the Total Cost of Ownership (TCO) model, the Cost per Unit of Service (CpUS) model, or the Cost per Outcome (CpO) model. Another option is to employ cloud cost benchmarks or industry standards that provide average or typical cloud costs for different sectors, regions, or use cases. By estimating your cloud costs in this way, you can create a budget that is realistic and accurate and avoid unexpected fees.

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Sanford J. Witcher III

Chief Architect at Legal & General America
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To ensure predictable cloud costs, start by clearly understanding your cloud pricing models and actively monitoring usage. Implement budget alerts to prevent overspending. Regularly review and optimize your cloud resources, removing unused or underutilized instances. Employ auto-scaling to adjust resources based on demand, avoiding overprovisioning. Consider reserved instances for predictable workloads to benefit from discounted rates. Establishing strong governance policies and educating your team on cost-efficient practices is also crucial.

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Frankely Peralta

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Para poder tener una buena estrategia hay que monitorear en un rango definido el costo que esta generando el cloud, En el monitoreo se establecen parametros de normalidad, maximo consumo y minimo Con respecto a esto se puede sacar un estimado teniendo en cuenta los parametros antes mencionado.

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3 Monitor your cloud usage

After you have estimated your cloud costs and created your budget, it is important to monitor your cloud usage and track your cloud spending on a regular basis. This can help measure performance and utilization, detect and resolve any anomalies, and optimize resources and services. To do this, you can use cloud dashboards from providers such as AWS Management Console, Azure Portal, or Google Cloud Console to view metrics like CPU, memory, disk, network, and latency. Additionally, you can set up cloud alerts and notifications when usage or spending reaches a certain threshold or limit. This can prevent potential problems like performance degradation or budget overrun. Generating cloud reports and audits can also provide detailed information about activities, events, and transactions to verify compliance and accountability. By monitoring your cloud usage, you gain visibility into performance and spending while ensuring quality and reliability.

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Enderson Menezes

DevOps, Automation and Site Reliability Engineering
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It's crucial to cultivate a culture of autonomy and accountability within your technology team. To do this, make the most of the project systems and TAGs offered by providers. This makes it easier to identify products or micro-services that may need more attention, that can be optimized to reduce costs, or that, due to their importance or use, will increase in costs. This strategy promotes transparency, benefiting other areas of the company.

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4 Optimize your cloud resources

Finally, after monitoring your cloud usage and tracking cloud spending, you need to optimize your cloud resources and services to maximize value and return on investment. This can be done by using cloud scaling techniques to adjust resources and services according to workload and demand, as well as selecting the most cost-effective pricing model for cloud resources and services. Additionally, cloud automation tools and scripts can be used to automate tasks and workflows, increasing productivity and consistency. By optimizing your cloud resources, you can achieve your goals, deliver value proposition, and ensure predictable costs. For example, AWS Auto Scaling, Azure Autoscale, Google Cloud Autoscaler, AWS Savings Plans, Azure Reserved Instances, Google Committed Use Discounts, AWS CloudFormation, Azure Resource Manager, and Google Cloud Deployment Manager can all be used in the optimization process.

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5 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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Craig Strangwick

Digital Transformation, Lead-to-Cash
(已编辑)
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Understand at the start that the ease increased scalability will have implications on predicted usage. The ability to spin-up sandpits , multiple test environments and ‘temporary’ project instances of all your systems (which can sometimes consume far more computing resource that production systems) could invalidate the original business case if its all about cost reduction, but what value do you place on this kind of agility ? Carry out a risk assessment to include the above types of ‘growth’ as well as external factors such as vendor costs linked to CPI and FX rate changes. Build a model in Excel at the business case stage, that you can use to do what-if analysis & predict future costs.

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How can you ensure predictable cloud costs?

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1 Define your cloud strategy

2 Estimate your cloud costs

3 Monitor your cloud usage

4 Optimize your cloud resources

5 Here’s what else to consider

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