How to Anticipate and Plan for Costs in the Cloud

All organizations have their reasons for moving to the cloud, from improved processes to simpler scalability to decreased costs. For many, however, undergoing a cloud migration and managing an AWS, Azure, or multi-cloud environment actually results in greater costs than anticipated. According to Gartner, an estimated 80% of organizations will exceed their cloud budgets through 2020. 

Even as businesses aim to optimize cloud costs, many predict their spending will continue to rise. Without proper cost management, and more importantly, an understanding of how to plan for cloud spend, organizations will continue to face sticker shock. But by defining the biggest challenges businesses face when it comes to predicting and planning for cloud costs and taking the steps to mitigate them, organizations can optimize their cloud spend strategy and make the most of their digital investments. 

The Challenge: Lack of Visibility

One of the biggest difficulties businesses face that prevents the accurate forecasting of costs is not being fully aware of who is spending money, how much they’re spending, and what they’re spending on. Oftentimes, several players across departments may have access to spending, with too few standardized processes and little oversight, making it easy to lose track of what, when, and why purchases are made. 

The Solution: Take Full Inventory of Spending and Track in Real Time 

Before you can plan for the future, businesses must start by identifying and recording all areas of spending. Staying up to date with all current cloud spend and resources can help identify points of overspend and wasted or inefficient resources. By tracking everything from what cloud solutions are running to SLAs and software licensing, you can prevent surprising costs from popping up month to month. This is an ongoing process for optimizing cost management, but is necessary to ensure all costs are constantly accounted for and associated with an owner to minimize wasted dollars.

Once you have accounted for your current spending, you can then track your costs in real time  – which is crucial for anticipating future costs and building accurate budgets. Businesses should monitor all cloud usage to identify unused resources or other inefficiencies in spending that can either be removed or adjusted to be more valuable.  

The Challenge: Not Enough Time or Resources to Handle Cost Management 

Both AWS and Microsoft provide documentation and guidance on “avoiding unexpected costs”. However, its often very time and resource consuming for many organizations to follow and implement even some of these policies and recommendations.

Constantly monitoring all cloud usage and spend can be extremely complicated – particularly in a multicloud environment when your business must keep track of several cloud vendors and understand multiple different (sometimes complex) pricing models. These tasks require nearly constant attention and the skills to work efficiently with these vendors to properly identify misuse or inefficient spending. For many organizations, there simply aren’t enough resources and IT professionals on staff capable of dedicating the time to cloud cost management. 

The Solution: Partner With a Third-Party for Cloud Cost Optimization

While managing and optimizing cloud spend in-house is possible, it may end up adding even more unpredicted costs associated once you factor in the training, tools, and time required. To avoid this, organizations may want to consider partnering with a cloud management provider that can handle these tasks and ensure all money spent on cloud infrastructure is done so effectively. A cloud management partner can provide real value in your cloud journey by setting up the proper guard rails for an initial deployment or for optimizing an existing Azure and/or AWS environment. For example, a qualified partner can set up policies, detect, automate, and remediate cost anomalies as well as configure budget alerts by department for real time notifications. A cloud management provider can help your business understand current costs as well as anticipate and budget for future spending needs – so your next billing cycle won’t include any surprises. 


Want to know more about how a cloud management provider can help your organization cut costs and optimize your cloud environment, all with certified expertise and 24/7 support? Give CentriLogic a call today.