What can you do when a growing cloud bill is evidence of your success?

Congratulations! You have pushed and pulled to get your IT department to embrace a more agile service delivery model. You have added public cloud as an addition to your on-premises IT service delivery portfolio. But as a result, your CIO is now having a conversation with your CFO about that budget line item called “monthly cloud bill.”

CIO: “Based on your input we moved to a usage-based IT service model.”

CFO: “Yes, but our cloud costs are up 50% over last year.”

CIO: “We’ve worked hard to shift how IT sources and delivers services. It’s working.”

CFO: “OK. But, you need to find a way to cut this cloud bill.”

Cloud cost cutting is different

A focus on cost-cutting is not new for IT operations. But optimizing your cloud bill is different than trimming operating costs and wringing efficiencies from on-premises operations. It’s a hard cost. Someone cuts a check to pay your cloud vendor every month. And it is pay-per use.

Quite simply, the goal with cost optimization in a pay-per-use environment is to avoid consumption that doesn’t add value.

If you have one or more IaaS clouds, or even software defined datacenter on-premises, you can use your cloud management and orchestration tools to optimize consumption and cut big pieces out of your cloud bill.

These simple lifehacks use automation and API driven orchestration to drive efficiencies:

  1. Standardize instance size – If you give a techie a credit card and say, “Go provision what you need,” they often reach for more than they need just in case. But “just in case” can mean “twice as much.” For example, if you study the Microsoft Azure pricing calculator, each step up in instance size doubles the price. (e.g., D1 = $0.14 per hour. D2 = $0.28 per hour etc.) Conversely, each step down is half the price.

Lifehack: Figure out the optimal instance size for each tier of frequently deployed workloads. That starts by determining when performance stops being affected by an increase in payment for instance size. Then, get everyone who deploys that workload to deploy with the optimal configuration.

  1. Turn it off when you are done – Cloud bills are littered with zombie workloads. As we move to a more agile and continuous software lifecycle, more workloads are deployed for shorter periods of time. But people get busy and forget.

Lifehack: Automate the deletion of short-lived workloads after a preset period of time. Set a policy to delete workloads for developers after two weeks. Or QA and test after two days. Or you can do this categorically for certain types of temporary workloads. Or even for anything related to an underfunded project.

  1. Suspend it when you are not using it – Developers don’t actually work 24-7. So why not automatically suspend their cloud workloads at night? That will cut a portion of your cloud bill by 50%.

Lifehack: Automate suspension of workloads for specific users on a pre-set schedule. Don’t forget to unsuspend on schedule if you want to want users to actually participate in this effort. Additionally, give them an easy way to click an exception if they get inspired and want to work in the middle of the night.

  1. Scale it when you need it – With APIs and load balancers, there is no reason to provision cloud resources that sit idle waiting for peak workload. Scale out and deploy more application instances when needed. Then scale back when not needed. That way, you won’t pay for what you don’t use.

Lifehack: Use scaling policies to automatically deploy more instances as usage grows. You can trigger scaling based on simple infrastructure metrics like CPU utilization. But it is even better to use more powerful APM tools like AppDynamics to instrument your entire application ecosystem. You can detect and respond to emerging user metrics or business process metrics to ensure quality of service where it counts most.

  1. Have a plan – If you have hard cost limits for projects, teams, or even individuals, remember that people respond well when they know the limits and can easily regulate their own usage.

Lifehack: Set a budget. Let people know someone is monitoring cloud usage and costs against that budget. Then communicate limits in a way that matters to these individuals. Make it easy for those individuals to see how their behavior is affecting tracked cost and usage metrics.

  1. Negotiate a discount – Yes, you can negotiate a discount with your cloud vendor. If you are spending approximately $1 million over three years you can ask for and get single digit price reductions. You need to be in the tens of millions spend rate to get custom discount. But you won’t get it if you don’t ask.

Lifehack: Consolidate your cloud accounts. If everyone centrally consumes cloud services, you can standardize services, reduce shadow IT, and take advantage of a whole range of other benefits.  But, you can also get a rolled up and aggregated view of usage and spending. You need that before you reach out and ask for a discount.

Cisco CloudCenter when it counts

Cisco CloudCenter is an application centric cloud management platform. As you might expect, it can help you implement all the lifehacks I have shared above.

I’ll post a follow up blog on how much cost reduction is possible using these techniques.  Obviously, your mileage may vary. But I have a simple worksheet that I’ll share.

Watch this 30 minute webcast to see how CloudCenter can help you implement these lifehacks to cut your cloud bill.


Kurt Milne

Marketing Manager, US

CloudCenter Marketing