Why Your Multi-cloud Environment Needs a Resource Tagging Strategy

In the previous blog post we discussed streamlining FinOps through Resource Tagging. In this blog post, we discuss why a Resource Tagging strategy is essential for a multi-cloud environment.

Enterprises are adopting a multi-cloud strategy for various reasons such as: pick the best-of-breed cloud services, mitigate risks, and to avoid vendor lock-in. With a well-defined multi-cloud strategy, enterprises can take advantage of pricing competition between cloud providers to drive cost efficiencies. A good multi-cloud strategy can also help you find the right-sized cloud service for your needs.

However, multi-cloud provides opportunities as well as challenges for enterprise customers in terms of cost. When the applications run in a high availability scenario across cloud providers, the cost will be high compared to running high availability between availability zones or regions. A high availability architecture across cloud providers will incur high bandwidth costs which might negate some of the cost advantages with multi-cloud.

Another factor that has been a challenge for enterprise IT is cloud sprawl. With cloud consumption spanning multiple services, the problem is magnified in multi-cloud. As cloud services sprawl, it becomes critical to shut down unused services to ensure cost efficiencies.

Why do you need a Resource Tagging strategy in multi-cloud?

• Gain Complete Cost Visibility

As enterprises navigate this multi-cloud journey, lack of visibility is emerging as a big challenge. This is severely impacting their ability to innovate while staying secure, compliant, and cost-effective. With multiple resources deployed in different regions, zones etc., the need to organize and have standardized resource groups is eminent. One needs to have a visibility of the group of resources allocated to a particular environment or an application or a team.

Lack of visibility or sub-optimal visibility results in cost leakages that could go undetected resulting in significant losses. IT needs complete visibility and better alerting mechanism to contain cloud service sprawl and cost efficiencies. Implementing a consistent ‘Resource Tagging’ strategy enables enterprises to gain visibility into the cloud spend and thus address arrest sprawling as it occurs.

• Enable Efficient Cost Monitoring

In a multi-cloud scenario, each cloud provider has its own monitoring tools. Even though they are comprehensive enough to support various services offered by the cloud providers, it doesn’t work across cloud providers. Similarly, first-generation cloud management tools offer limited features to handle multi-service and multi-cloud landscape. Their monitoring tools are primitive to meet the needs of today’s cloud observability challenges. A well defined resource tagging strategy, through a single window of monitoring costs, enables higher efficiency.

• Provide Accurate Cost Reporting and Analytics

When it comes to cost reporting, enterprises struggle to associate costs with technical or security dimensions, such as specific applications, environments, or compliance programs. Enterprises can use predictive analytics to analyze the usage patterns of cloud resources and, consequently, predict costs across cloud accounts, tags, regions, and user groups. They can also gain critical recommendations on optimizing cloud resources, thus avoiding cost leakages.

• Utilize Intelligent Automation

Automation is crucial to ensuring high availability and resiliency in cloud. Enterprises use scripts to run various automation templates, but the challenge comes in when you need to deploy such scripts across a specific set of resources allocated to a particular group.

In the above scenarios, the recommended approach is to implement a consistent set of global tags to efficiently gather actionable data insights by assigning useful information to any resource within your cloud infrastructure.

In the next blog post we will discuss the key features of a robust resource tagging policy.