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8 Guaranteed Strategies That Will Help You Optimize Your Cloud Cost Management

Cloud cost management is growing in popularity. According to Gartner, worldwide end-user spending on public cloud services is predicted to grow 23.1% in 2021. More businesses are expected to move their operations to the cloud. 

And for good reason, cloud providers are adding more functionality to their cloud platforms. They have made moving to the cloud cheaper and more efficient. IDC has shown how the spending on traditional IT infrastructure has reduced since 2019 and is predicted to continue reducing through 2024. In contrast, spending on both private and public cloud has increased.

When organizations move to the cloud, they get many benefits, including efficiency, better performance, and decreased costs (more on benefits later). However, to realize the benefits – especially cost benefits, cloud users and organizations need to make sure that they use cloud resources wisely. Many organizations are spending a lot of money on resources that they don’t use. Forbes magazine estimates that at least 30% of cloud spend is wasted.

In this blog, you will learn about cloud cost management. The blog will show you what causes high costs and 8 ways to reduce cloud costs in the lower sections.

What Is Cloud Cost Management?

Cloud cost management is systematic planning that organizations use to understand and manage the costs of cloud technology. Thus, it’s a way of finding cost-effective ways to maximize cloud efficiency and reduce cloud spend.
Since cloud infrastructure is becoming increasingly more complex, the pay-for-what-you-use model is challenging to track. Therefore, cloud cost management is critical. When implemented correctly, it can result in significant savings.

Advantages Of Cloud Cost Management

Decreased Costs

Decreased costs are the first advantage that you’ll notice once you start doing cloud management. How does this happen? By closely managing your cloud spend, you avoid overspending on cloud resources. Overspending is a critical issue affecting companies globally. Gartner estimates that companies unaware of the mistakes made in their cloud adoption will overspend by 20 to 50%.

When purchasing cloud resources, you get discounts based on pre-payment or volume; this is another way you save money.

Predictability

Businesses can estimate their cloud spend and thus plan their budget. Cloud cost management helps businesses prepare and plan for the future. A business that correctly forecasts its cloud computing needs has a clear advantage over its competitors.

Efficiency

Businesses that look closely at their cloud spending can reduce their spending and increase their efficiency. How? They can reduce resource waste and take advantage of cloud technologies that enhance efficiency, e.g., load balancing and automatic scaling (more on this later).

Better Performance

When organizations take advantage of cloud cost management, they should take great care when choosing cloud resources. They should only choose resources that are the right fit for the needs of the organization. This is a cost management tactic called right-sizing (more on this later). 

Overprovisioning – which means getting very powerful cloud resources, should be avoided because it means overpaying. On the other hand, under-provisioning means getting less powerful cloud resources, which can cause performance to suffer. There is a delicate balance between the two. With careful planning and right-sizing, businesses get smooth performance without increasing their cloud costs.

Visibility

Cloud cost management will help your organization get more visibility into its internal workings. Why? Because It’s impossible to practice good cloud cost management without detailed visibility into your organization’s cloud usage and cloud architecture. This visibility will help you in other areas, e.g., governance and security—a perfect win-win situation.

Factors That Contribute To High Cloud Costs

Unplanned Migration

Most businesses don’t want to be left behind by their competitors. They will want to migrate to the cloud when they see their competitors doing the same. They may not be ready to move to the cloud leading to an expensive learning experience. 

To combat this, organizations should make sure that they have a plan that clearly outlines the impact and cost of moving to the cloud. Next, they should compare the cost of the cloud with on-premises operations.

Misconfiguration Mistakes

Organizations that sign up for cloud services need to know the pros and cons of each configuration of their choice of resources. 

Otherwise, they find that they may implement a certain configuration only for it to become more expensive than expected. Gartner estimates that 80% of companies unaware of the mistakes made in their cloud adoption will overspend by 20 to 50%.

When migrating to the cloud, always make sure that every bit of data that’s transferred or stored is taken into account.

Types of Resources

Depending on your needs, cloud resources such as compute power, storage amount, memory and network traffic could be costly.

Cloud Cost Optimization Strategies

  1. Describe the Problem

First, you need to understand where the issue is. This means describing the general nature of the problem, the negative impacts, and how it comes about.a

When describing the problem, focus on the primary issue, which is wasteful cloud spending. Next, focus on the resulting secondary issue that excessive cloud use is causing to the environment.

You should also understand where cloud waste happens in the organization. This means drilling down to specific departments, groups, and roles to find out who is responsible.

  1. Create Organizational Strategies

After defining the problem, create a strategy that outlines precisely what you plan to do and what you will do. The strategy should include solid steps such as creating budgets and setting policies around cloud usage.

  1. Deploy Monitoring and Notification Tools

You need to take advantage of cloud monitoring tools. These monitoring and notification tools help you to know when something is going wrong. Depending on your provider, you can get notified when something is about to go wrong or when it’s happening.

Notification tools may notify you:
– When you exceed your monthly spending limit
– When you violate policies
– When you infringe on security policies
– On the number of resources remaining (e.g., instances and storage) after a certain period.

  1. Automatic Scaling

As mentioned earlier, automatic scaling lets enterprises use more resources when the need arises and fewer resources when demand is low. 

It’s a sure way to reduce cloud expenses since you’ll only be using more resources when it calls for them instead of constantly using them.

  1. Power Scheduling

Power scheduling lets you shut down instances that are not used 24/7. You could shut down Non-essential instances during the weekends or overnight. This option is much cheaper than running them constantly.

  1. Removing Unused Resources

Removing unused or unattached resources is one of the easiest methods to reduce your cloud costs. Unused resources are usually created by R&D department teams who initiate cloud usage then forget to terminate it once they are done with it.

Another cause may be that the administrator may terminate instances and forget to remove storage attached to those instances. The organization ends up being billed for resources that they once purchased but are not using. 

  1. Right-sizing

Right-sizing involves analyzing instance performance and your usage needs. Using the information from the analysis, you turn off idle instances and remove overprovisioned or under-provisioned instances. 

As mentioned earlier, right-sizing helps you get the right instance for your needs, saving you money in the process.

  1. Billing From One Account

Having one account billed by your cloud provider makes it easier to catch errors and easily track your cloud spend instead of having multiple accounts. Also, when using one account, you can take advantage of discounts given by cloud providers.

How Ceeview Can Help in Effective Cost Management

Monitor Cloud Costs

Moving your business into the cloud results in many advantages. However, one of the biggest challenges is finding a simple and intuitive way of controlling your cloud costs. The pay-as-you-go model used by cloud providers is complex, and cloud cost and resource usage can be hard to control.

However, with the Ceeview cloud monitor, you will always be in control of your cloud cost. How? Because Ceeview is built to address the complexity of managing cloud costs in multi-cloud environments. You get to control your costs easily using out-of-the-box dashboards with aggregated cost and cloud health data. 

For those in need of comprehensive analyses, there is drill-down functionality into insightful dashboards and reports with detailed information. 

Ceeview cloud monitor will also notify you of potential cost savings.

Monitor and Optimize Resource Costs

As mentioned in the cloud cost optimization strategy earlier, monitoring idle instances is key to reducing cloud costs. 

Ceeview helps you by monitoring resource usage to detect underutilized and idle instances. You then have the option to remove or disable these idle resources.

Cost Forecasting

You can now easily plan your budget with no worries since the Ceeview cloud cost forecasting feature helps you easily predict future costs on a monthly or yearly basis.

Health Monitoring

With Ceeview, you get notifications of your cloud health environment. This helps you to always know your cloud performance. Your clients get a better user experience since there’s no service disruption.

Root Cause Analyses

When your cloud runs into performance issues, Ceeviews root cause analyses will help you know and understand why the issue happened and where it came from. 

Ceeview will also give you a detailed event analysis.

Multi-Tenant Support

Ceeview can help enterprises and managed service providers (MSPs) to manage their customers and divisions.

Multi-cloud Support

Ceeview supports major cloud providers such as Amazon AWS and Microsoft Azure.To learn more about Ceeviews Cloud Cost Monitoring and Optimization, read the detailed features here.

FAQs

What are the Advantages Of Cloud Cost Management?

The advantages of Cloud Cost Management are; Decreased Costs, Predictability, Efficiency, Better Performance and Visibility – It’s impossible to practice good cloud cost management without detailed visibility into your organization’s cloud usage and cloud architecture.

What Factors Contribute To High Cloud Costs?

The factors contributing to high cloud costs are:
1: Unplanned Migration – Most businesses want to migrate to the cloud when they’re not ready.
2: Misconfiguration Mistakes – Organizations need to know the pros and cons of each configuration of their choice of resources.
3: Types of Resources

How can I Optimize Cloud Costs?

You can optimize Cloud Costs by;
1: Describe the Problem
2: Create Organizational Strategies
3: Deploy Monitoring and Notification Tools
4: Use Automatic Scaling
5: Use Power Scheduling
6: Remove Unused Resources
7: Use Right-sizing
8: Do Billing From One Account

How Can Ceeview Help in Effective Cost Management?

Ceeview can help increase cost management effectivity in the following ways; Monitor Cloud Costs, Monitor and Optimize Resource Costs, Cost Forecasting, Health Monitoring, Root Cause Analyses and Ceeview Helps Managed Service Providers (MSPs) to Manage Their Customers in addition to supporting most of the Major Cloud Platforms

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8 Easy Methods of Doing Cloud Cost Monitoring And Optimization

The cloud offers businesses unlimited scalability and lower costs by only charging for the resources used. Despite this advantage, many organizations still find the cloud costly since they use a lot of cloud resources without utilizing them properly. 

cloud cost monitoring

Using cloud resources might seem cheap. However, if you take a step back and look at the total amount of money you’ve spent, it might shock you, especially if your business relies heavily on the cloud. 

Therefore, you need to make sure that you properly utilize every dollar you spend. That’s why it’s imperative for businesses and organizations to do effective cloud cost monitoring and optimization.

This article is divided into three major parts; you are going to learn;

  • How you can use machine learning for cloud cost monitoring
  • The benefits of cloud cost management
  • Easy methods you can use to do cloud cost monitoring and optimization

What is Cloud Cost Monitoring?

Cloud cost monitoring is simply understanding and managing your organization’s cloud costs. It helps you to maximize your cloud usage while minimizing cloud spend.

Using Machine Learning For Cloud Cost Management

Machine Learning - Ceeview.com

The Artificial Intelligence (AI) and Machine Learning (ML) field is still growing. However, this hasn’t prevented cloud vendors from using AI in cloud cost optimization. Some cloud providers and vendors use AI tools that scan cloud workloads to identify spikes in cloud usage and their causes.

Cloud vendors use ML when they want to improve anomaly detection. ML helps remove all the guesswork and presents more relevant results.

ML and AI tools work in the background and help identify anomalies that drive your cloud costs up. 

A good example of an AI application is a tool that alerts a cloud administrator when they set a configuration that can drive up the company’s bill.

Using AI and ML models that do real-time application resource management can be constructed. These models can simultaneously optimize performance, compliance, and cost. Cloud vendors can analyze cloud-generated data to predict scaling demands and future resource demands.

Benefits Of Cloud Cost Monitoring

Accurate Budget Allocation

Cost monitoring enables you to create an accurate budget. With the right monitoring tools, you get a comprehensive overview of your budget when monitoring and optimizing your cloud costs. This lets you see the precise information coming from your business units, products, and cost centers. With this information in your hands, you can easily and accurately plan your resources and budget allocation.

Accountability

Accountability is transparency that allows people to take ownership of their activities and their activities’ impact.

In cloud cost management, a lack of accountability is due to the absence of structure and tools to monitor activities and costs in the cloud.

Cloud cost monitoring encourages team members to know and be focused on their roles. When cost monitoring is implemented, every team member learns to be accountable and responsible for all they do in the cloud.

Easy Ways To Do Cloud Cost Monitoring

  1. In-depth Analysis Of Your Infrastructure

The first thing you need to do is to perform a serious analysis of your cloud infrastructure. This means knowing how many instances, networks, software, and storage devices you are using. Once you understand your infrastructure, you get an idea of the resources at your disposal.

  1. Cloud Resources Visibility

After the analysis, you need to have accurate information about every instance and virtual machine you have. This helps you in many ways. Documenting all your resources lets you know what you’re being billed for.

  1. Cost Analytics

You need to know what you are spending and what you’re spending it on. Using analytics, you should track your usage patterns and trends. This means having all the information in the form of graphs and reports. When it comes to analytics, the more data you have, the better it is to help you make informed decisions.

  1. Policy-Based Governance

Nowadays, all cloud providers have effective policy-based governance tools that can help you track cloud usage and costs. Furthermore, they can send notifications to cloud administrators when the account exceeds its specified limits. 

These policy-based governance tools handle huge workloads by upgrading instances temporarily and shutting down instances and virtual machines automatically when not in use.

Take advantage of these tools by using policies to terminate servers created to handle the massive workloads temporarily. You can also right-size instances and remove unused and underutilized resources to avoid waste.

In summary, policy-based governance lets you use metadata, custom tags, etc., to define a set of rules that lead to improved cost management.

  1. Budgets

You need to define a cloud budget. This budget should be for departments, cost centers, and projects. You can then ensure that there is an approval mechanism to avoid cloud cost overrun. The mechanism sends alerts when the budget limit is overrun. 

Having a clear budget helps departments be accountable for their cloud usage and limit resource use.

  1. Role-Based Access

Set an enterprise-wide mechanism that clearly defines permissions and accessibility rules. Afterward, you can permit users to manage the infrastructure actively. With role-based access, you can quickly identify who launched, terminated, or changed infrastructure. And what they did to take corrective action and control costs.

  1. Controlled Stack Templates

Stack templates are cloud resources that are used as a single unit. Predefined/controlled stack templates are cloud resources whose rules or configurations have been adapted to the administrator’s specifications. 

Administrators can add security, network, and instance configurations. This makes the process of deploying instances faster and ensures only specific resources are deployed.

Having predefined stack templates makes it much harder for users to create configurations that drive up costs.

  1. Automated Alerts and Notifications

Automated alerts help you to stay on top of day-to-day changes in your cloud environment. Furthermore, they allow you to make critical decisions.

You should make sure that you share reports with details on cost, usage, and performance with stakeholders and team members. These reports should also detail budget overruns, cost spikes, and untagged infrastructure. Sharing your alerts and notifications results in increased visibility and accountability from your team.

How Ceeview Can Help You Perform Cloud Cost Monitoring And Optimization

Ceeview Cloud Cost Monitoring

Ceeview is a Digital Monitoring Platform that offers you a simple way to monitor cloud costs and budgets. 

Some other features that complement cloud cost monitoring include;

Avoiding Budget Overrun

This feature helps your finance department to avoid surprises and unexpected cost overruns. Ceeview monitors cloud spending and sends you notifications that tell you when you’ve reached the limits of your budget.

Cost Forecasting

Using the power of analytics, Ceeview gives you the power to predict your future cloud costs. You don’t need to use any other analytics platforms. Ceeview will handle cost forecasting for you on a monthly and yearly basis.

Dashboards

Featuring one of the best and simple dashboards in service management, Ceeview enables you to get a complete insight into the cost performance of your cloud environment at a glance.

Cloud Cost Optimization

In addition to cost monitoring, Ceeview will help you know which areas can be adjusted to optimize your cloud costs.

Cloud Savings Potential and Reports

Ceeview lets you know how much you can save on your cloud bills and gives you detailed reports about how much you have saved.

Root Cause Analyses

With Ceeview, you will always know what caused your cloud costs to spike and how you can stop it. Ceeview breaks down the costs giving you the best analysis to let you make informed decisions.You can get more detailed information about Ceeviews Cloud Cost Monitoring and Optimization capabilities here.

Cloud Cost Monitoring FAQ

Can Machine Learning Be Used for Cloud Cost Management?

Yes, some cloud vendors already use Artificial Intelligence (AI) and Machine Learning (ML) tools. They use AI tools to scan cloud workloads and identify spikes in cloud usage and their causes, while ML is used to improve anomaly detection.

What Are the Benefits of Cloud Cost Monitoring

Accurate Budget Allocation – The tools give you an overview of your costs, enabling you to plan your budget accurately.
Accountability – Team members learn about cloud costs which helps them be responsible when using cloud resources.

What Are Easy Ways to Do Cloud Cost Monitoring?

Perform analysis of your infrastructure
Document all your Cloud resources visibility
Use Cost analytics
Using Policy-based governance tools
Specify Budgets
Ensuring that’s there’s Role-based access
Using predefined/Controlled stack templates
Using Automated alerts and notifications

How Can Ceeview Help You Perform Cloud Cost Monitoring and Optimization?

Ceeview has a cloud cost monitoring tool that helps you avoid budget overrun. It has a user-friendly dashboard that shows you your cloud costs and savings potential. Furthermore, Ceeview has a cost forecasting and optimization feature.

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For more about Cloud Cost Monitoring, please call +4724077200 or send a message

Lower your bills with Ceeview Cloud Cost Optimization & Monitoring

The Ceeview Cloud Monitor gathers and visualizes the overall cost and performance of your Cloud environment.
Helped by intuitive dashboards, managers and personnel responsible for budgets will gain immediate insights into the cloud cost status.

Challenges moving to the Cloud

“Operating your IT estate is fundamentally different in the cloud. The traditional model of managing capacity by purchasing and running physical hardware doesn’t work. Instead, you must continuously manage consumption, capacity, performance, and crucially – cost. It requires a very different skill set as well as new operational functions.” Source: Accenture (May 2021)

Stine Glibstrup

Stine Glibstrup
Manager SME, Proff

“With Ceeview Cloud Monitor, we managed to reduce
our cloud costs by 45% in 3 months”

Cloud Cost Optimization & Monitoring

Ceeview is built to address the complexity of managing cloud cost in multi-cloud environments. It provides out-of-the-box dashboards with aggregated cost, security, and cloud health data for managers and customers. For those in need of comprehensive analyses there are drill down functionality into insightful dashboards and reports with detailed information. You will be notified if there are cost or security issues and you will have access to a list of recommendations for cost savings and security concerns. It help maintain reliable, secure, and cost-efficient cloud solutions.

Features

  • Predictive cost analysis and forecasts.
  • Estimate of potential Cloud cost savings.
  • Detailed list of recommendations for cost savings.
  • Forecast of monthly and annual costs.
  • Complete overview of total accrued costs.
  • Health monitoring of Cloud infrastructure.
  • Budgets status; subscriptions, services, and instances.
  • Visualize workload owners the cost they are accountable for.
  • Notification in case of overspend and budget breach.
  • Overview of inactive, underused and idle cloud resources.
  • Monitor and visualize Key Performance Indicators (KPIs).
  • Governance and Security compliance score.
  • Drill-down for cost analyses.
  • Role-based dashboards .
  • Automated Reporting.
  • Multi-tenant support.

In addition to cloud cost optimization, Ceeview gives you full visibility into your cloud-based Services, Applications, Infrastructure and SLAs. Ceeview allows you to monitor the Cloud environment for optimal performance and availability with drill-down into each of these areas.

Don’t waste your money – manage and control your cost

Cloud overspending

20-50% Cloud budget overspend

Companies that are unaware of the mistakes made in their cloud adoption will overspend by 20 to 50%. Source: Gartner. Worldwide end-user spending on public cloud services is forecasted to grow 47.2% between 2020 and 2022, reaching $397,496 millions USD in 2022. Source: Gartner. When companies incur such an increase in costs, they have little choice but to meet the expectations they implicitly create.

Wasted Cloud Spend

30-40% of cloud spend is wasted

What makes it even more important to control and optimize your cloud cost is that there is an estimated 30% of cloud spend that is wasted according to Forbes Magazine. Other market watchers, such as Accenture, put the rate of waste closer to 40% (Container Journal).

Start reducing your cloud bill with Ceeview

Svein Roger Bergsli

Svein Roger Bergsli
President & CEO Wspace

“By use of Ceeview Cloud Monitor, we typically cut our clients cloud bill with an average of 20-40% within 3-4 months.”

Ceeview Cloud Cost Monitor Optimization
  • Take control of your cloud spend and budgeting
  • Don’t waste money
  • Dive in to see where money is spent
  • Visualize cost for those spending it – make them accountable

Free trial – 30 days

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