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Best Practices for Cloud Cost Optimization

Best Practices for Cloud Cost Optimization

Cloud computing means delivering computer services, including servers, storage, database, analytics, software, networking, and intelligence over the Internet to fuel faster innovation, flexible resources, and economies of scale. The Cloud provides companies with unlimited scalability and lowers IT costs. Some examples of Cloud Computing are Dropbox, MicrosoftAzure, Rackspace, etc.

There are four types of Cloud Computing which are as follows:

  • Private Clouds
  • Public Clouds
  • Hybrid Clouds
  • Multi Clouds

 Theoretically speaking, a public cloud costs less because you only have to pay for the resources you use. Furthermore, there are three main types of Cloud Computing Services, which are as follows:

  • Infrastructure as a Service (IaaS)
  • Software as a Service (SaaS)
  • Platform as a Service (PaaS)


What does Cloud Cost Optimization mean?

It is as simple as the name suggests; Cloud Cost Optimization means managing your cloud operations to keep your cost as minimal as possible when it comes to Cloud Computing. Many reports show that many companies waste 35 percent of their Cloud spent. Therefore, it is beneficial to understand Cloud costing and all the hidden costs to optimize your spending since the decision-making regarding cloud computing falls into technical hands.

There are some ways that you can employ to save money on cloud computing, like scaling back or eliminating unnecessary resources. But the major benefits will come over months. The following are some of the benefits of Cloud cost optimization.


Five Benefits of Cloud Cost Optimization

Along with a decrease in cost, your cost optimization operation for cloud services comes with some more benefits. Let us have a look at them.

  • Reducing Cost: Using a strategy for using cloud computing can help you save money, and you can take advantage of these cost-efficient opportunities like advance payment, volume discounts, and eliminating unused or unnecessary resources. 
  • Predictability: When having a strategy in mind and planning your usage accordingly, you will not suddenly be hit by a sudden increase in expense. To be in charge of your cloud computing, you can employ many Cloud monitoring tools (datadog,, and cisco cloud monitoring) that can help you determine your spending and ways to reduce it.
  • Efficiency: Unused resources are waste. Henceforth, load balancing and auto or on-demand scaling can ensure that your business uses the cloud resources efficiently, optimizing the cloud cost.
  • Performance: Choosing the right resources and tools is important for your business. The same goes for your cloud computing services because otherwise, you will spend more or less. So paying attention to your business needs and setting the right combination of cloud computing resources can take you miles.
  • Visibility: A clear view of what you are doing to build your brand and manage cloud service is important. Visibility will not only help you in cloud cost optimization, but it will also help you streamline other areas related to your business growth, such as cloud security.


Ten Ways for Cloud Cost Management

There is a difference between Cloud Cost Optimization and Cloud Cost Management. The latter means managing your Cloud costing via tracking, reporting, analyzing, and allocating cloud spending; on the other hand, the former means the actions taken based on the metrics to maximize your Cloud’s value. 

Let us go through ten ways for your cloud cost management in the following:

  • Cloud Monitoring: Cloud Monitoring allows you to gain insights into the usage of your cloud resources. There are some of the components which you should pay attention to monitor your infrastructure properly, viz., Cloud database and server, applications and websites, Containers, hypervisor, and code repositories. Moreover, there are many tools that can assist you in monitoring your cloud infrastructure, like Amazon Web Service (AWS), etc. These tools help in performance monitoring, cloud cost optimization, security monitoring, and administration monitoring. 
  • Budget Alignment: Make sure that you understand your company’s budget and goals concerning all the projects lined up. Hence, it would be best if you always focused on creating a cloud cost optimization strategy. But it is important to involve all the executives, engineering leaders, and product leaders in the budget-making process to avoid any miscommunications in the future.
  • Cost Analysis: Cost should be among the performance metric for your organization, so make it as easy to understand as possible. These metrics should be measurable, up-to-date, and have a clear view of valuable vs. invaluable costs.
  • Correct data according to the right people: You should be efficient in determining what metrics to monitor and what not to save your time and resources. delivering the right data to the right people at the right time is critical. Although the data you deliver is the same, you need to format it differently according to the individual teams within your company. Your engineering team will have to answer different questions with the same data as your finance team.
  • Optimize Cloud Costs With Data: Optimization of Cloud Costs can be attained by following some easy steps. The first one is planning. Use cost data and budget to create the plan because this will allow your team to make necessary changes to optimize spending. The next step is deployment, which means the unexpected spending is quickly identified and adjusted. A further step is to design and build. You and your team have to make cost-efficient decisions and should be able to report on the unit cost and planned spending. And the final step is monitoring. When you monitor the aftermath of the decisions, you will be able to manage your cost and spending better. 
  • Analysis in Real-time: When you analyze your data, the decisions made, and their consequences, you can make changes, adjust your spending, and set your priorities at the moment. Finding the right solution on time is the key to optimization. Every business model has its own struggles, and there is no fit-to-all model. By analyzing your actions, getting rid of unwanted resources will not only optimize the cost but also improve performance. 
  • Right-size Resources: Your business will change over time. Depending upon your performance, you will either need to upscale it or downscale it. Henceforth, finding and consistently modifying your cloud computing resources according to your business needs is very important. 
  • Accountability: You need to hold your engineering team accountable; otherwise, there will be no limit to the use of resources, and an extravagant bill will hit you by the end of the tenure. Because engineers are the ones contributing to the major cloud cost, they should be included in the cost discussions. 
  • Quick scaling: Since businesses are growing at a fast pace and do not have time for manual upgradation of each and everything. Here comes autoscaling or on-demand scaling. These will help you in upscaling or downscaling according to your business’s need for resources. 
  • Continuous Optimization: When considering cost as your metric (which you should), you can not just set it in the beginning and forget about it because your demands continuously change. Therefore, you should employ a continuous process of Cloud Cost Optimization that will sync with your development cycle to make sure that you have an efficient cloud system.


Some ways to reduce Cloud Spending

Let us now dive into some ways to reduce our cloud spending to make our cloud environment efficient and effective. 

  • Reduce Waste Resources: As we have mentioned above, companies waste 35 percent of their cloud resources. By pinpointing these waste resources and eliminating them, you will be able to reduce your cloud spending. 
  • Unused Resources: Unused resources are equivalent to waste resources. Therefore, it is better to get rid of them as soon as possible.
  • Idle Resources: On-demand scaling helps you to upscale your resources in case of a sudden traffic spike. So you do not have to make room for sudden traffic spikes. It would be best if you eliminated all the extra rooms that will allow you to reduce your cloud cost linked with such resources, which have gone unnoticed for a long period.
  • Right-Size Service: It is certainly important to use the right size of services for your business. Extra resources will lead you to increased costs, and little resources will head toward bad performance. We understand that choosing the right size for your business model might be difficult from 1.7 million determined configurations. You can ask your service provider to help you in this regard. 
  • Heat Maps: A heat map is a tool that provides you with a visual indication of the ebb and flow associated with computing demands. This tool will help you by telling you when it is safe to shut down your server and allowing you to automate scheduled start and stop instances to optimize the spending further.
  • Multi-Cloud: It will help you make sure that you are fulfilling every slot and getting a solution for every problem. Multi-Cloud also helps you in taking full advantage of each specialization and enjoying the perks that come with using different providers. 


 Cloud Costing can hit you like a rock if not kept checked on. Therefore, this article has intended to help you in finding ways that can lead to reducing your cloud cost and optimizing your performance at the same time. Moreover, different tools have also been mentioned that can help you in monitoring your cost, letting you upscale or downscale according to the demands of your business at a given time. We hope that this article will prove to be helpful to our readers.

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