Myths often distort our thinking and deviate us far from the ground reality. One such widely pervasive myth about Cloud is that it always saves money. Gartner research also points to the same finding. Most of the Enterprises enthusiastically begin their Cloud journey with a determination to reduce IT costs. Lowering costs is a great business goal, but the critical question to ask yourselves is – Is Cloud on its own, the elixir which guarantees you the Cost reduction?
Our conversations with customers and partners, including industry specialists like Gartner, reveal something very different. Enterprises actually experience escalating IT costs after migrating to Cloud.
What is the reason for this strange paradox?
Firstly, there is so much hype surrounding Cloud, especially around the costs, that the real reason behind the genesis of Cloud is overseen. The core business benefit of the Cloud is and has always been, increased speed of change. So fundamentally, the expectation that Cloud always equates to cost savings is incorrect. Secondly, a commonly observed mistake is to compare the costs of a VM (or something similar) on Cloud Vs. On-premise Data center.
Instead, the focus should be on the total cost of ownership (TCO) considering factors such as actual IT infrastructure, cost of its maintenance (physical and personal), lead time to access new technology, and the impact it has on innovation, cost of staying compliant and secure.
Here comes the million-dollar question (actually several million) – Is it possible to have both, the agility of Cloud while optimizing costs? The good news is that it is very much possible. However, definitely not without continuous automation and governance. Hence, they should be your top priorities from Day 0 of your Cloud journey.
Here are the few areas where you can leverage Automation and Governance to avoid cost leakages. These will not only help you gain significant cost advantage but also other business benefits.
- Continuously discover the unused and over-provisioned resources and take automatic corrective actions
- Monitor the cost usage at both high and granular levels and predict the future trends to be well prepared
- Enforce the automated tagging of resources as an organization-wide process. It will be convenient in quickly categorizing the spend into different buckets and build accountability
- Proactively identify the compliance and security gaps, and resolve them before they become disruptive business threats. The cost of non-compliance can be staggering!
- Improve Cloud operational efficiencies. Even if you have outsourced the Cloud management tasks to an IT partner, review and encourage them to leverage technology as much as possible
- Free up valuable time of your IT infrastructure teams which can be invested in more meaningful tasks
- With seamless governance, you can confidently choose whatever fits best to your needs – cloud service, vendor. Thus, building solutions that delight your customers with no fear of vendor lock-in
Cloud is a critical ingredient to achieve your Digital ambitions successfully. Do not let false beliefs and expectations demotivate you from leveraging Cloud. Instead empower your teams with relevant automation tools and governance processes to consume, run, and manage the Cloud services without any friction.
I will conclude my post with a Gartner Quote, which I hope will prompt an action to evaluate your current state of Cloud costs.
“Through 2020, 80% of organizations will overshoot their cloud infrastructure as a service (IaaS) budgets, due to lack of cost optimization approaches”