Infographic: Active Cloud Cost Management Can Reduce Cloud Costs By Over 30%

If you’re like many organizations migrating to the cloud after years of managing on-premises data centers, you may be accustomed to more of a "set-it-and-forget-it" mindset when it comes to IT infrastructure management. Unfortunately, applying this same mindset to your cloud cost management will make it impossible for your organization to realize the full cost and performance benefits the cloud has to offer. 

Unlike fixed on-premises deployments, the cloud offers flexibility to change your cloud configuration in real time based on your actual usage. That's why moving to the cloud requires adopting an active cloud cost management mindset. Only with ongoing active management can you make adjustments to ensure you're always meeting your performance requirements at the lowest possible costs. 

Although many companies may think that they’re approaching the cloud with an active cost management approach, it turns out that the vast majority aren’t doing enough to reduce their cloud costs. In Cloudamize’s analysis of over 77,000 AWS instances, we found that 34% of the instances had cost saving opportunities greater than 30% (you can see this and more analysis in the infographic below). 

 

What is Passive Cloud Cost Management?

It’s not surprising that many organizations approach their cloud deployments with a passive management mindset, which is an approach that fails to undergo continuous analysis and adjustments. The fixed nature of on-premises deployments means that most organizations plan their requirements years in advance so monitoring data center usage won’t result in a change to on-premises capacity, and they unfortunately bring this mentality to their cloud deployments.

Although provisioning to ensure that you meet your full capacity can seem like the safe bet when you’re designing your cloud configuration, this approach leads many organizations to experience "sticker shock" upon seeing their first cloud bill. When you provision for peak usage and then passively manage your cloud, you'll end up with a costly over-provisioned configuration. If you only plan for peak capacity, it’s as wasteful, expensive, and unnecessary as running your heater every day just to make sure you your home will be comfortable on the coldest day of the year.

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What is Active Cloud Cost Management? (And Why Does it Matter?)

To actively manage your cloud costs, you need to continually evaluate your usage to ensure that it matches your capacity. Active cloud cost management involves collecting and analyzing performance data like CPU, memory, disk, and network I/O on an ongoing basis to make sure your configuration has minimized wasted headroom and other unnecessary costs.

By actively managing your cloud, you can scale capacity up and down in real time based on actual usage, identify opportunities to switch to a more cost-effective pricing plan, and move certain workloads to different instances - greatly reducing your overall cloud costs.

(Learn how Cloudamize continuosly provides actionable insights and recommendations on cost and performance so that your cloud configuration is always right-sized).

In practice, active management helps you identify instances that may have been right-sized last month but are no longer right-sized this month due to your organization’s changing needs or changing cloud options.  Failing to correct these instances can lead to higher cloud costs or performance issues.

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Infographic: Cloud Cost Optimization Analysis Shows Companies Can Significantly Reduce Cloud Costs

Whether for lack of useful tools, time, or understanding, organizations that bring a passive management approach should expect poor visibility and miscalculation of capacity and performance requirements that will frequently result in costly over-provisioning. Cloud management requires IT teams to learn a skill that is significantly different from managing an on-premises data center, but those who adopt an active cloud cost management mindset from the outset will ensure they’re meeting their performance requirements at the lowest possible cost. The following infographic highlights our cloud cost optimization analysis of 77,000 AWS instances and proves how without active management, companies are paying more than they should be.

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