How businesses can cut cloud costs
The goal for any organization is that their cloud implementation fits their needs like a glove fits a hand. Snug, allowing full flexibility and providing the protection it was designed to provide – no holes, no constrictions. This is a
It’s a neat analogy but when gloves wear out we can simply acquire new ones. With cloud, things are more complex, and maintaining that snug fit is an ongoing matter.
One way to think of a misaligned cloud setup is to see it as creating unnecessary expenditure. Using the cost metric as a measuring stick can help an organization identify issues, and manage them. Because cost is constantly tracked and reported at regular intervals, the cloud measuring stick can be applied in an ongoing way too. And because cost is closely allied to performance, measuring cloud against finances is also related to performance.
Within that framework, it can be helpful to think in terms of buckets into which keeping control of cloud spending falls. These need to be regularly revisited and checked over, but cannot be ignored entirely unless leaders seek costly fixes.
Make sure all cloud implementations meet strategic aims
It sounds obvious, but it is easy for cloud implementations to lose their alignment to strategic aims. A business unit might argue for a particular cloud implementation and get it, without enough thought being put into how this integrates with the whole. Or the organization’s strategic aims might shift – anywhere on the continuum between subtly and seismically – and a misalignment with cloud can result.
To keep on top of both foreseen and unforeseen changes, it is vital that the C-Suite has its hands fully on the reins. “The C-suite needs to know why their organization has cloud and clearly communicate the potential and value of it, so business and technology leaders can deliver a strategy which realizes this value,” says Adrian Bradley, head of cloud transformation at KPMG UK.
John Diamond, Solutions Architect at Park Place Technologies suggests some key metrics against which cloud performance can be measured: “Cost reduction, revenue growth, customer satisfaction, agility, security, and compliance. Understanding these factors will guide an organization in assessing the effectiveness of your current cloud strategy,” he said.
Like Bradley, Diamond is clear about the role of the C-Suite here: “They should define and enforce cloud governance and policies that clearly outline the roles, responsibilities, and processes for cloud usage, security, compliance, and cost management.”
Hunt down and eliminate unneeded elements
If cloud is to fit the organization like the glove of our earlier example and unnecessary spending is to be eliminated, work has to be done on an ongoing basis. Above all else, the C-suite needs to understand, authorize, and promote the importance of this work.
Key focus areas include hunting down duplicate, redundant, or otherwise unneeded cloud services, as well as fine-tuning what is needed by pruning and augmenting where necessary. Eliminating data siloes, identifying offline systems that would be better online, and archiving or deleting “clutter” are all constituent parts of this work.
Stewart Laing, CEO at Asanti stressed to us that it is “really important that this is done from a business perspective, not an IT one, taking into consideration all operational and resilience aspects. The teams carrying out this assessment need to ask what the systems and applications in place are doing and whether they are meeting the needs of the business.”
Undertake regular cloud audits and strategy reviews
Cloud audits are vital and need to be done regularly to ensure that cloud use dovetails with the needs of the business.
As to how the auditing is done, Laing suggests a few methods and a caveat: “Deploying data discovery tools, regular analysis of usage and cost, and maintaining an inventory of deployed cloud services and solutions is important,” he notes, adding that IT departments are not always best placed to do this work. “Quite often, you’ll find that IT departments are not aware of just how critical some applications are to the business, so you need to probe those at the very heart of the business, not just IT, to ensure you get it right.”
It is important to be open to the fact that benchmarks against which cloud is audited will change over time, along with the overall activity of the organization.
“An enterprise which uses cloud to carry out sophisticated data analysis, such as a market research company, will want to have an architecture which easily provisions data into cloud environments for research,” says Bradley. “It may, however, choose to store infrequently accessed data in the cheapest available storage with slower retrieval times.”
Create and implement clear policy for future cloud activities
Over time, cloud use will evolve along with the organization. Both your own needs and cloud provider you choose can change. What is needed in the organization today might not be needed in a year, or may need to undergo digital transformation.
Along with auditing, cutting, and refining comes looking forward, understanding where your organizational needs are going, and developing a cloud to meet those needs. For the C-Suite, keeping one eye on the future is an essential part of oversight. Ensuring cloud is embedded within your strategy can help reduce cost management as well as implementation planning.
And, as our commentators have noted, keeping oversight and decision-making at the board level and organization-wide rather than solely vested with IT will be central to reviewing cloud spending and keeping it tightly aligned to the organization’s needs.
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