Azure Cost Optimization Services

Reduce spending, improve resource utilization, and maximize your return on cloud investments.

The historical approach to IT assets has been largely capital expenditure (CapEx) investments into expensive hardware, which is then handed over to a third party to maintain for the remainder of its life expectancy. Finally, when it is obsoleted by advancements in technology, it is replaced by another capital expense and the cycle starts all over again. With supply chain challenges caused by geopolitical disruptions, and talent shortages and inflationary pressure leading to increased costs, companies are being asked to do more with less.

Putting aside the positive performance aspects of a cloud migration, Azure can help companies lower their technical debt, free up support team resources to cover more assets and reduce total cost of ownership (TCO) over the length of a typical CapEx investment in hardware. In the case of a high-performance SQL Server, organizations can expect a TCO reduction of over 30%.

IT as a Cost Centre

Enterprises often view IT operations as a cost centre, asthey are the ones making investments into their organization’s data processes and architecture. What they fail to realize is that the benefits of these investments extend far beyond the IT department. If this view persists it can be difficult for companies to adjust to an OpEx view of computing. Adopters of platform-as-a-service (PaaS) form in the cloud are billed monthly, as opposed to yearly license purchases, multiyear gaps on license true-ups and 5-year gaps on hardware purchases.

When IT is viewed as a drag on company resources, it is tempting for departments to set up “shadow IT” operations by having other departments perform IT functions, to speed up time to market or avoid getting board approval for new hardware. It is not uncommon for organizations to end up with mission critical data being served by an old desktop, buried in a cubicle, seeing a second life as business intelligence server.

IT Is an Enabler

IT can become more flexible and responsive in the cloud. Not just when it comes to service-level agreements (SLAs) like Recovery Point Objective (RPO) and Recovery Time Objective (RTO), but in how it delivers value to other parts of the enterprise. We commonly see a move to a chargeback model when companies start to view IT as a value centre. This allows IT to show business value associated with various initiatives by associating costs to specific business units.

This can be an effective way to reshape the story of a company’s IT spend, but can lead to a loss of control for IT leadership and open the door to technical debt and potentially IT silos and fiefdoms. A less drastic form of chargeback models has been a ‘Showback’, where IT maintains a report of costs associated with business units but continues to operate as a central agent for all IT spend. Organizations can enable this without modification to existing profit and loss statements.

Azure Cost Optimization Benefits

Adastra can help make the business case for organizations looking at their first cloud migration and help more mature environments hit their TCO target savings.

Accountability

Use of budgets, forecasting and the reporting in Microsoft Azure can provide all the tools for teams to be able to quickly detect variations from the expected budget. Accountability isn’t just about punishing teams that overspend so much as establishing a healthy communication about expectations and ensuring every accountable person knows how specific actions can affect budgets. If no one is accountable, no one will care to correct any poor behaviours. One of the easiest ways to ensure accountability is to empower a cloud governance team to block unauthorized deployments to any environment.

Cost Consciousness

One of the primary drivers for organizations to move to the cloud is the promise of cost savings. The shift from CapEx to operational expenditure (OpEx) means consistent visibility and accountability must be applied. Management, finance and data and application teams must work together to set and achieve cost goals. The tradeoff is the chance to optimize costs is constantly available.

Cost Monitoring

For an organization to be cost conscious they must be able to accurately estimate costs. If you can’t measure it, you can’t manage it. Adastra helps you create the right cost management scope for your needs, including integration with resource tagging and standard role-based access controls (RBAC). This helps your ops teams, apps teams and finance department get the information they need without oversharing.

Optimization

Optimization projects in the cloud often feel like an exercise in balancing performance vs cost. Often, cost optimization requires multiple iterations to find the right balance and can be greatly assisted by setting the right expectations. While compute resources are the obvious target for most optimization efforts, in the cloud just about everything from VPN gateways to storage accounts, to alerts can be optimized to great effect.

Azure Cost Optimization Objectives

We go beyond simple tweaking with the Cost Management portal to address the root cause. It is not enough to merely identify the problem, but to build a remediation plan and then execute.

Shut down unused resources

Use Azure Advisor to identify idle virtual machines (VMs), ExpressRoute circuits, and other unused resources. Get recommendations on which resources to be shut down and estimations for expected savings.

Right-size underused resources

Identify underutilized resources in your environment and optimize your cloud spending by either reconfiguring or consolidating these resources.

Prepay for consistent workloads

Embrace a flexible pay-as-you-go pricing model where you get discounts when reserving instances for longer.

Configure autoscaling

Save by dynamically allocating and de-allocating resources to match your performance needs.

Set proper budgets

Create and manage budgets for the Azure services you use and leverage Microsoft Cost Management to monitor your organization’s cloud spending.

Select the right Azure compute service

Optimize Azure costs by selecting the right compute service for your application as Azure offers many ways to host your code.

Let’s lower your technical debt