Cost Management Strategies in Public Cloud Systems

Public Cloud Cost Management Strategies

Public Cloud Cost Management Strategies are critical for many organisations, as cloud usage can quickly become complex and expensive if not managed properly. According to the 2024 State of the Cloud Report, 94% of enterprises are overspending on the cloud, suggesting that a large majority of companies are likely exceeding their cloud budgets to some degree.

Effective Cost Management Strategies for Optimising Public Cloud Resources

• Set clear budget limits and use forecasting tools to predict future costs, ensuring spending aligns with business goals and avoiding unexpected expenses.
• Leverage cloud management tools to track resource utilisation, set up alerts for unusual activity, and regularly review reports to identify and address inefficiencies.
• Manage your resources, use auto-scaling to adjust capacity based on demand, and continually monitor and adjust to balance performance with cost.

Public cloud systems are very flexible and can easily grow with your business. But they also come with challenges, especially when controlling costs. Since you pay for what you use, expenses can go up quickly if you’re not careful. However, there are ways to manage your cloud spending effectively.

Here’s a look at effective cost management strategies for public cloud systems to help you maximise your investment.

Implement Budgeting and Forecasting

Without clear budget limits, your spending can quickly get out of control, especially with the flexibility and scale that cloud services offer. Budgeting helps you align your cloud costs with your business goals and prevents unexpected expenses.

IDC estimates that 20–30% of all cloud spending is wasted. Control Cloud Costs (idc.com)

Set Clear Budget Limits

To avoid unexpected costs, create a clear budget for your cloud usage. Set your budget limits based on past data, expected needs, and business goals. Having a limit will help you create a financial plan and give you a standard for reviewing your spending.

Monitor and Adjust Regularly

Once you have set your budget, it’s essential to monitor it regularly since cloud environments and your needs may change over time. Make sure to review your spending periodically and adjust your budget as necessary. This proactive approach will help you stay within your financial limits while adapting to changing needs.

Use Forecasting Tools

Forecasting tools are important for predicting future cloud costs based on usage and trends. These tools analyse previous data to estimate future expenses, helping you plan better. Including forecasting in your cost management strategy allows you to make informed decisions and avoid unexpected budget overruns.

Regular Monitoring and Adjustments

It’s important to keep a close watch on how you use your cloud services to avoid unexpected costs and make sure you’re getting the most out of your investment. Analysing how you use resources helps you identify where you are spending money and gives you insights into using your resources.

With the right tools and practices, you can prevent potential issues and avoid exceeding your budget for cloud services.

Leverage Management Tools

Cloud management tools show you how resources are being used and provide a clear idea of how your money is being spent. By tracking this data, you can find ways to reduce costs and make things work more efficiently.

Set Up Alerts for Unusual Activity

You can check your cloud provider’s billing and usage reports to find any unusual or unexpected charges. You can also monitor your costs by setting up alerts for any significant changes in your spending. If the numbers suddenly spike, it’s likely something isn’t working as it should.

If you spot any issues, investigate them to understand what caused them and take action, if necessary, to correct them. Regularly reviewing these reports is crucial for preventing potential cost overruns before they become big problems.

Identify and Address Inefficiencies

Remember to actively search for inefficiencies in your cloud setup by reviewing reports and identifying idle or underutilised resources. Take action to optimise or decommission these resources to save costs and improve overall cloud efficiency.

Optimise Resource Allocation

As your business grows, it’s vital to align your resources with current needs to avoid spending too much. This not only helps control expenses but also improves overall system efficiency.

It’s important to adjust your cloud resources based on real-time demand and performance metrics to ensure you’re using them effectively. This will help you get the best value for your investment while maintaining the necessary service levels for your operations.

Brodies LLP, one of the UK’s leading law firms, faced the challenge of scaling their operations while controlling operational costs. In partnership with Trustco, they upgraded and optimised their infrastructure, enhancing scalability and performance, and reducing operational costs.

Right-Size Your Resources

Review your workloads and adjust the sizes of over-provisioned resources to match your current needs. This should be an ongoing process that aligns with your evolving business goals and performance requirements. A continuous focus on right-sizing can help you reduce wasted resources, ultimately cutting your cloud costs.

Implement Auto-Scaling

Auto-scaling is a helpful feature that adjusts resource capacity based on real-time demand. It automatically increases or decreases resource utilisation to ensure you only pay for what you actually use. Set up auto-scaling rules to match your usage patterns and optimise resource allocation.

Balance Performance and Cost

While optimising resource allocation, it’s important to balance performance and cost. Ensure that any adjustments made for cost-saving purposes do not negatively impact the performance of your applications. Strive for an equilibrium where resources are efficiently used while maintaining the necessary performance levels.

Partner With a Managed Service Provider

By using both tools from your cloud provider and other outside solutions, you can see all your cloud expenses. This helps you stay informed and in control of your costs. You can partner with a managed service provider for an even more thorough analysis. They can provide a range of benefits, including:

• Proactive Support and Consulting: Partnering with a managed service provider gives you access to a team of professionals who are familiar with your setup and can advise on cost management strategies. They can also help with routine maintenance and troubleshooting issues.
• Continuous Optimisation: Experts will monitor your usage and performance, providing actionable insights to optimise your resources, reduce costs, and ensure high performance.
• Access to Advanced Tools: Managed providers can offer advanced tools and techniques for cost management that you may not have access to. These tools may include automated optimisation, data analysis, and cost modelling.
• Comprehensive Reporting: With experience working in various industries, managed providers can create customised reports for your business, which can help you easily track and manage your cloud costs.

Thinking about the future with Trustco

A Private Cloud setup may be right for you, right now – but if you aspire to have a Hybrid setup later on, Trustco have you covered. We natively design systems that are future-proofed, so that your Private Cloud infrastructure is compatible with a Hybrid setup when you’re ready to upgrade.

We are ready to assist you in managing your cloud costs effectively. Contact us today to discover how we can support your cost management needs and ensure you maximise your cloud investment.