Cloud Essentials believes that managing cloud costs is about more than just cutting expenses. It’s about striking the right balance between performance and cost, ensuring you get the best value out of your Azure investment without overspending.
Let’s take a look at how (and why) to make that happen.
Why is it important to optimise Azure costs?
One of the big benefits of cloud services is that you only pay for what you use. Unfortunately, it’s all too easy for those savings to be eroded by inefficiencies that lead to wasted resources and unnecessary expenses.
Effective cost optimisation helps organisations identify and eliminate these inefficiencies, enabling them to allocate budgets more wisely and ensure resources are properly utilised. This not only saves money but also ensures that applications and services run smoothly with the right amount of resources.
Let’s also not forget the importance of cost management in ensuring compliance with internal policies and industry standards, maintaining both financial and operational accountability.
Key strategies for Azure cost optimisation
Cloud Essentials guides its clients through a range of cost optimisation strategies, helping them make informed decisions and adjust their Azure environments as their needs evolve.
These are some of the techniques the company uses.
1. Avoiding over-provisioning and under-utilisation
One of the most common ways organisations waste money in the cloud is by over-provisioning resources. This happens when you allocate more virtual machines, databases or storage than your applications actually require.
By regularly reviewing your cloud usage and adjusting resource sizes based on actual demand, you can prevent over-provisioning, improve efficiency and reduce unnecessary budget drain.
2. Evaluating licensing models
Choosing the right licensing model is critical for cost optimisation. Azure offers various pricing options depending on your needs, and selecting the most appropriate one can lead to significant savings. Cloud Essentials likes to work with its clients to assess their software and applications to determine the most cost-effective licensing strategies for their business.
3. Selecting the right storage tier
Azure provides multiple storage tiers, each with different pricing based on data access frequency and retention needs. By selecting the most appropriate storage tier, it’s possible to significantly reduce costs for less frequently accessed data, while still maintaining fast access for critical information.
4. Implementing data life cycle management
Data doesn’t just grow – it also ages. Implementing a data life cycle management strategy helps organisations manage their data retention and deletion schedules, ensuring they are not paying to store outdated, unused or otherwise unwanted information.
Cloud Essentials also advises on archiving strategies, which move older, less critical data to cheaper storage options, keeping costs down while maintaining compliance with data retention policies.
5. Leveraging “reserved” or “spot” instances and auto-scaling
To drive further savings, Cloud Essentials helps organisations take advantage of reserved instances for workloads that are consistent and predictable, as well as spot instances for non-critical or flexible workloads. These can significantly reduce costs compared to on-demand pricing.
By implementing auto-scaling policies, Cloud Essentials also ensures that resources automatically adjust to match demand, scaling up during peak times and scaling down during quieter periods. This dynamic approach ensures you’re only paying for what you need, when you need it.
6. Tagging resources for cost allocation
Azure’s resource tagging capabilities allow you to track and allocate cloud costs across different departments, teams or projects. This helps in understanding where costs are coming from and provides better financial visibility across the organisation. Cloud Essentials helps its clients implement a resource tagging strategy that makes it easy to track spending, enabling more accurate budgeting and forecasting.
The key to successful cost optimisation: planning
In Cloud Essentials' experience, the key to achieving meaningful cost optimisation invariably lies in adequate planning. By assessing your business requirements up front, you can ensure that your cloud infrastructure is designed to meet your needs without incurring unnecessary costs. Whether it’s choosing the right pricing models, scaling resources appropriately or managing data more efficiently, planning allows you to make the most of Azure’s flexibility while keeping your budget in check.
Working with Cloud Essentials means gaining the ability and insight to create a comprehensive cost optimisation plan that ensures your Azure investment delivers maximum value and ROI. Cloud Essentials continuously monitors your environment to identify new opportunities for savings, ensuring that your cloud solution remains both high-performing and cost-efficient. Read more insights here.
Join the Cloud Essentials webinar for more information, or catch up online
If you’re looking for more insights and strategies for managing spiralling Microsoft Azure costs, join the Cloud Essentials webinar on 18 March (or click the link to view the recording after the event date). Find out more here.
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