Why you should put reinvestment at the heart of your cloud strategy

When it comes to cloud, cost management is incredibly important

Yet simply finding savings should never be the end goal – the main objective should always be trying to find ways to use any savings in a way that modernises your organisation’s IT and allows you to achieve wider business objectives.  

This is easier said than done. It’s a bit of a truism, but when it comes to managing costs in the public cloud, “you don’t know what you don’t know”. The popularity of hyperscale public cloud platforms like AWS, Azure and Google Cloud has exploded in a short space of time so general understanding is low, even among IT teams.  

This is equally the case for those new to cloud as it is for businesses that have been there for some time. This is okay – after all, cloud can be complicated. For businesses new to cloud, it’s an entirely new way of procuring technology and infrastructure, while even the most cloud-savvy companies can do with a health check in this area every so often.  

With cloud, there’s always scope to learn and refine the structures in place to make more informed decisions and optimise spending. Making the necessary changes may require a little initial work, but after that managing cloud costs should be almost subconscious and part of an IT team’s day-to-day. 

 Get off on the right foot 

 Organisations new to cloud should put cost management at the heart of what they do from the start. These businesses are often coming from a legacy world of physical infrastructure located in an office or data centre – hardware that will last for three-to-five years and is procured on a nice fixed budget.  

In the cloud world, of course, it’s not like that. With cloud, you pay for what you consume and, while there are plenty of benefits to this model, it also means your costs can fluctuate. This can mean that some businesses go into cloud without knowing what’s required and don’t have the right skills, resources, or structures in place. Costs can quickly become unmanageable, so you must make sure you’re ready for an entirely different way of working financially.  

It’s important, therefore, to prioritise governance and best practice. If you don’t have the right structure or guardrails in place, you leave yourself incredibly exposed in the event the cloud environment becomes compromised. A malicious actor could get into your environment that, for example, hosts a small amount of compute and data – then open the flood gates and start using potentially unlimited levels of resource, sending your organisation’s bills skyward.  

An employee could just as easily cause this kind of damage perfectly innocently. I’ve worked with customers where a member of the IT team has accessed an environment and installed software that unknowingly cost the business upwards of £30k per month – all because the organisation didn’t set up the right kind of controls from the start.  

 The importance of a check-up 

 The other side of this is, of course, the companies that are already in the cloud. Irrespective of the technology, it’s just a fact that some teams will set infrastructure up well and some won’t. Broadly, this is about doing two things: a cost management audit, and then setting up protocols and automated processes to ensure cloud cost management is taken care of on an ongoing basis.  

There are a few key areas that often show up on these cloud health checks. Many organisations, for example, won’t have taken advantage of reserved instances, where you can receive a significant discount if you know that you’ll need a certain level of infrastructure and that isn’t going to change.  

Companies could be running everything on an on-demand model – and paying far more than they have to in the process. Businesses may also be unaware of and therefore unable to identify so-called zombie resources, where software or servers have been spun up in an environment and not turned off – meaning they’re still racking up cost – after they’ve served their purpose.  

Right-sizing comes from a similar principle. If you are paying for too much resource, a health check can identify this and reduce it to a more appropriate and cost-effective level. There are also more transformative technologies in the cloud, such as platform-as-a-service, that can provide the right financial and technological fit for certain organisations that are ready to consume something more modern and flexible. 

 Be proactive and automate 

 A health check, however, is only as good as the measures that are taken to allow the business to proactively manage its cloud costs on an ongoing basis. Simply monitoring your cloud spend, for example, is pretty much a waste of money if you’ve not got anyone looking at the data or a strategy for what you do with it.  

Ongoing cost-management services can be a real help and often bring in expertise that doesn’t exist inside the business. It’s also important to automate ongoing cost-management processes wherever possible – and this is driven by software. These tools can automatically move infrastructure into different instances to make the most of the services you have. Yes, these services may take a percentage of the savings you make – but for an automated solution that’s absolutely worth it in my eyes – especially if you weren’t aware of these saving before. 

 Driving growth 

While it’s possible for your own IT team to carry out a cloud health check, you’ll often get better results by hiring external counsel with specialist knowledge and experience. A fresh pair of eyes can really help an organisation uncover the reinvestment opportunity that cost management provides. This isn’t just about finding overspend – this is about finding real budget that can then be reinvested into other areas of your technology ecosystem, making that next transformation or growth project even more effective. Cost-management for cloud is a hugely important enabler for businesses when done right.   

About the Author

Ross Pedder is Head of Cloud Services Sales at CDW UK. CDW’s solution architects offer expertise in designing customized solutions, while its advanced technology engineers assist customers with the implementation and long-term management of those solutions. Areas of focus include software, network communications, notebooks/mobile devices, data storage, video monitors, desktops, printers and solutions such as virtualization, collaboration, security, mobility, data center optimization and cloud computing.

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