While a lot of businesses rely heavily on cloud infrastructure, unchecked cloud expenses can escalate rapidly. Cloud cost optimisation isn’t just a cost-cutting exercise – it’s a strategic approach to maximising value while aligning costs with business goals.
In this article, we dive into the best practices, strategies, and tools to make cloud investments work smarter for you.
What is cloud cost optimisation?
Cloud cost optimisation is the process of strategically managing cloud resources to minimise expenses without compromising performance.
True optimisation isn’t about cutting corners, though. It’s about intelligently balancing cost with functionality. For example, rather than overprovisioning resources, businesses can dynamically adjust based on workload demands.
Why is cloud cost optimisation important?
Remember, that by fine-tuning your cloud usage, you can probably unlock a true treasure trove of benefits (gotta love alliterations).Check 'em out.
🔑 ROI boost: Efficient cloud usage ensures that every investment directly supports business growth.
💰Directs savings: Businesses save significantly by eliminating waste and optimising resource allocation.
📈 Operational excellence: Teams can shift focus from maintenance to innovation.
🌍 Sustainability: Cloud cost optimisation also fosters eco-friendly practices by reducing energy consumption and digital waste.
🔐 Security and compliance: Reduced complexity improves data protection and regulatory alignment.
💡 Real-world impact: Cloud optimisation can lead to significant cost savings by identifying and eliminating underutilised resources. For example, a report by CloudZero highlights that organisations can achieve substantial cost reductions by optimizing cloud spend.
Cloud cost optimisation: Best practices to reduce your bill
A great place to begin is by looking at your current usage. Are you getting full value? Are you leveraging your resources to the max?
Go through the list below and find the tools that fit your needs. Keep in mind that there are many more tools to pick from – these are just some of them 😊
✅ Right-size resources: Overprovisioning leads to wastage. Tools like Azure Advisor or AWS Trusted Advisor can help analyse and adjust resource sizes.
✅ Leverage reserved instances: For consistent workloads, reserved instances offer discounts of up to 72% compared to on-demand instances. For instance, Microsoft Azure, AWS, and Google Cloud all offer substantial savings with their reserved instance options.
✅ Automate unused resource management: Schedule downtime for non-critical resources using solutions like Azure Automation.
✅ Use cost-monitoring tools: Employ platforms like CloudHealth or AWS Cost Explorer for real-time analytics and cost visibility.
✅ Implement storage policies: Archive infrequently accessed data to lower-cost storage solutions, such as AWS Glacier.
Cloud cost optimisation strategies
To go beyond short-term savings, you might want to adopt these long-term strategies:
Multi-cloud flexibility
Harness the strengths of multiple providers, negotiating competitive pricing and avoiding dependency on a single vendor.
FinOps integration
FinOps bridges the gap between IT and finance teams to create a collaborative culture focused on financial accountability. Using this approach ensures continual optimisation.
Read more 👉 Explore FinOps for cloud cost efficiency
Serverless architectures
Transitioning to serverless computing – where you pay only for execution time – dramatically lowers operational costs while improving agility.
How to implement cloud cost optimisation
Step 1: Conduct a cloud cost audit to identify idle or underused resources.
Step 2: Define clear KPIs for success, such as cost reduction percentages or improved utilisation rates.
Step 3: Use AI-driven platforms like Spot.io to automate cost-saving measures.
Step 4: Continuously monitor and iterate, adapting to changing demands and scaling requirements.
🔧 Suggested tools: Azure Cost Management, Google Cloud Pricing Calculator, and AWS Cost Anomaly Detection.
Addressing challenges in cloud cost optimisation
It needs to be said, though – tackling cloud cost optimisation isn't always a walk in the park. From navigating complex multi-cloud environments to balancing performance with savings, the challenges are real.
But with the right strategies and tools, these hurdles can be overcome.
Complex multi-cloud environments
Unified cost-management platforms like CloudCheckr simplify oversight across different providers.
Balancing performance and savings
Performance monitoring tools such as Datadog ensure that optimisation efforts don’t compromise service quality.
Resistance to change
Foster a FinOps culture where cost optimisation becomes part of organisational DNA. Include stakeholders early to secure buy-in.
