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As enterprises move more computing resources to the cloud, cloud cost management and governance have become critical to successful cloud IT operations. Industry experts say that a properly managed cloud spend can reduce expenses on cloud providers like Amazon Web services (AWS), Microsoft Azure, and Google Cloud Platform. Cloud governance provides guidelines to mitigate the risks and efficiently monitor cloud services in verticals like compliance, cost, security, and operations. Implementing governance policies across a multi-cloud environment will increase agility in managing security and operations in the organization.
According to Gartner, by 2025, 85% of organizations will embrace a cloud-first strategy, and 95% of new digital workloads will be deployed on cloud-native platforms. Organizations that lack cost optimization processes will average 30% to 40% overspend in the public cloud.
Many CFOs are caught between the proverbial a rock and a hard place. The operational expense of the cloud is starting to exceed the capital expense of on-premises infrastructure. In many cases, the original cost-saving justification for moving to the cloud is no longer valid, as cloud costs far outweigh traditional on-premises costs. A “Flexera State of The Cloud Report” by Data Center Knowledge finds that 43% of organizations do not have automated or manual policies to use the lowest-cost cloud service. Another 38% have not developed guidelines to use their cloud providers’ lowest-cost regions. About 29% do not have automated or manual policies to shut down workloads after ours, 27% do not eliminate inactive storage, and 20% do not have policies to right-size their instances.
Organizations can use a multi-cloud environment to eliminate a single point of failure for business applications. In addition, it will reduce downtime if core business workloads are distributed across multi-cloud vendors. Single cloud vendor lock-in is one of the biggest problems for organizations, it is hard for organizations to switch to another cloud vendor, and migration becomes very time-consuming and expensive.
This whitepaper addresses overspending by guiding financial governance controls, such as usage quotas, budget alerts, and organizational policies, which can help keep cloud costs and usage in check. In addition, this whitepaper shares experience of “How Microland is effectively utilizing all the major Cloud Service Providers (CSPs) – AWS, Azure, and Google Cloud”, and putting the suitable cost control mechanism and cloud governance policies.
Organizations Embracing Multi - Cloud
Multi-cloud is a popular approach for deploying enterprise applications and computing resources but managing cloud costs has become an enormous challenge. While the public cloud continues to grow, many factors can contribute to increasing a cloud bill and need to be considered. An intelligent cloud cost management strategy certainly helps to avoid any billing surprises. Additionally, enterprises progressing through cloud adoption need a cost optimization strategy to control their spending.
As per a Flexera report, 93% of organizations have a multi-cloud strategy, and 78% of organizations are using Private and Public clouds.
The benefits of multi-cloud infrastructure—scalability, control, security, etc.—are easily observed, but there are challenges too, which includes:
Why Cloud Cost Management and Governance are Critical
Today’s IT infrastructure requires limited capital investments, and IT staff should focus on innovative work instead of managing infrastructure. Operation and specialist teams may not always necessarily get infrastructure to a functioning state, and business units can more easily deploy their own technology needs. However, without the proper infrastructure and processes in place, costs and governance are not always easy to manage.
There is also a significant difference in how cloud services and data center infrastructure are paid. If you create a virtual machine on a physical server in a data center, there is no inherent way to measure the cost of that action. If you create a virtual machine in the cloud, costs immediately begin to accrue. Cloud costs are tightly associated with usage, often down to the second.
As per Gartner, 60% of workloads migration from On-Prem / Private / Co-Lo Data center to Public cloud is a “lift and shift” approach which leads to overprovisioned and under-optimized deployments.
Cloud Governance disciplines are essential and guide decisions about the proper level of automation and enforcement of corporate policy across cloud platforms.
Cloud governance ensures that everything from configuration item deployment to systems interactions and data security is appropriately considered, examined, and managed.
Governance best practices like operational, security, compliance, and cost policies help organizations achieve business outcomes like rightsizing the cloud environment, saving time, increasing utilization, and reducing cost.
How Microland is Managing Multi - Cloud Environments
Microland’s Cloud Operations team integrates Cloud-native tools and industry-leading Cloud Management Platform (CMP) – Flexera. As per Gartner’s Magic Quadrant for CMP – 2022, Flexera CMP is in the Leaders Quadrant. The Cloud Operations team also integrates automation scripts and best practices of DevOps, which provides the following benefits:
Microland leverages all the major Cloud Service Providers (CSPs’) like AWS, Azure, and GCP, for its in-house and customer-facing applications. Microland hosts its homegrown ITSM platform-Smartcenter and IT analytics platform – SmartInsightsTM on Microsoft Azure and utilizes Google Kubernetes Engine to host the AI-Ops platform – intellegeniTM. We also leverage various PaaS services from the CSPs, such as AWS RDS, Azure Web-Apps, etc., and enable access to these applications and platforms by our customers and employees.
By leveraging multiple CSPs, Microland reduced the time to market the product launch and provide services to its customers.
Controlling public cloud costs and governance is not a puzzle. There are many tools and documented best practices available that enable an enterprise to control and manage expenses tightly. With some research, patience, and planning, an enterprise can implement a cost-effective cloud strategy, enabling the CFOs to quickly leave the rock and the hard place behind when they look at their monthly cloud spend.
Robust monitoring and alerting will allow cloud administrators to monitor cloud usage more effectively and react quickly, ensuring specific infrastructure does not hit cost thresholds and resulting in the following benefits.
About the Author
Raghavendra Seshumurthy Yerur, Sr. Manager- Cloud & Data Center, Raghavendra is a Security and Cloud expert with over 14 years of experience. Raghavendra was critical in implementing security and cost governance for Microland’s Multi-Cloud environment.
Himanshu Soni, Director – Cloud & Data Center, Himanshu is an IT Infrastructure and Cloud specialist with over 18 years of experience in IT Managed Services domain. He leads the Cloud Architect and Operations team supporting global customers.