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Using a Structured Framework to Optimize Cloud Costs

With the cloud revolution, engineers were given the power to create infrastructure in seconds. While this is great for an organization’s pace of innovation, it’s not ideal for budgets. 

This shift from CapEx to OpEx, where companies move from costs being fixed to variable, puts additional expectations on technology teams. There’s a need to focus on financial models, taking away from the necessary tasks of ensuring reliability and accelerating modernization.

We’ve worked with countless organizations who have tried solving these problems in various ways. On the not-so-great end, we see companies ignoring spend, until costs get too high. Or, only paying attention when budget forecasts are due for next year’s planning. We’ve seen customers buy into “solutions” that came to the rescue only to act as yet another costly platform, difficult to navigate and offered unnecessary “features”.

Now, more than ever, we have a need for ongoing collaboration between finance and engineering. Both teams need the know-how and the tools to reduce toil and optimize costs.

At the heart of it, organizations that are successful at cost management work towards creating a culture of cost transparency. I mean, if an organization doesn’t make its costs transparent, how can its employees make informed decisions on cost optimization? 

But how do you develop a culture of cost transparency and cost awareness? Google Cloud + Cloudbakers recommends a systematic framework to guide you on your cloud cost management journey:

  1. Governance to ensure only appropriate people can add projects or billing
  2. Capture your spend to reduce manual effort for chargebacks 
  3. Report on spend to understand usage and set alerts for unexpected spikes
  4. Actively Manage Ongoing Costs using tools to assist in complex decision making
  5. Predict Spend to forecast usage and costs

These steps also form the basis of Cloudbakers Managed Cloud Optimization program. Along with Ternary, we provide the knowledge and the tools to help drive cost optimization within your organization, including both engineering and finance teams. Here, we take a deeper look into the perspectives of each.

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Originally published on May 19, 2021

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