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Cloud Cost Optimization Questions You’d Like to Ask

Cloud Cost Optimization Questions You’d Like to Ask

~5 minutes read

Many companies are obsessed with the idea of migrating to the cloud and they have strong arguments for it. Judge for yourself: сloud resources can be easily scaled at any time; there is the possibility of automating time and effort-consuming processes.

Cloud computing allows companies to reduce maintenance and operational costs to stay within the IT budget. However, it’s not as simple as it seems. Without proper control, it’s beyond easy to lose track of resource consumption rates and end up with huge cloud bills.

According to Gartner, the vast majority of organizations devoted to the cloud face unexpected cloud bills. The best solution, in this case, is to create a solid cloud cost optimization strategy and adopt cloud cost management tools.

When trying to accomplish this task, many companies bump into a huge pile of questions. We answered the most relevant of them in this article, and suggested the vital cost-saving measures, in order to support your cloud cost optimization journey.

1. What is cloud cost optimization?

Cloud cost optimization is the process of resources and costs management that leads to a reduction of overall cloud spending. There are various strategies to optimize cloud costs, so you can:

Take advantage of discounts – for example, invest in Reserved Instances.
Monitor cloud resources – identify and eliminate wasteful resources, such as idle or underutilized instances.
Scale to meet your needs – get rid of unused resources, as well as reduce them: scale or rightsize cloud resources. Moreover, there is a possibility of increasing the number of resources to improve cloud performance.

Cloud cost optimization strategies: discounts, monitoring, scaling

2. What discounts can I get?

Some cloud vendors offer discounts for purchasing resources in advance to help users reduce cloud bills. The most common way to save money is the investment in Reserved Instances. Purchasing them you pay upfront regardless of actual use and get a discount based on a long-term commitment.

Well-known public cloud providers offer reserved capacity for computing. When talking about AWS, it’s called Reserved Instances; Azure refers to them as Reserved Virtual Machine Instances; GCP calls them Committed Use Discount. All three cloud vendors allow users to commit to a certain volume of resources for one or three years.

3. Are there any “hidden” cloud operating costs?

Cloud provides users with computing resources on-demand. However, it’s a common situation when the company purchases the resources but doesn’t use them or stop using them. Such resources drain your IT budget and they are absolutely useless.

Public cloud providers offer the “pay-as-you-go” pricing model. The majority of business owners understand this phrase as “pay-for-what-you-use”. However, this pricing model means that you pay for what you ordered. That’s why it’s easy to end up with huge cloud bills for unused resources.

First of all, you need to identify unused, idle, and underutilized instances you’re being charged for. Once they’re discovered, you should review these instances. There are several possible ways to deal with them: shut them down, reconsider their size or balance the workload with their help.

4. What role does scalability play in cloud cost optimization?

Generally, there are two types of scaling in the cloud: horizontal and vertical.

Horizontal scaling, also known as scaling in or out, means adding cloud resources as new instances, in order to balance the workload.

Cloud vertical scaling, on the other hand, is when the company changes the size of the instance by replacing the existing one with the bigger version. It’s also called scaling up or down.

Vertical and horizontal scaling in cloud computing

Rightsizing (or scaling down) is an effective way to optimize costs. Not only does it ensure that the size of the instances matches the workload, but it also prevents you from the careless purchase of unnecessary resources. It happens because the analysis is one of the elements of rightsizing.

It’s vital to remember that besides overprovisioned resources, there are also under-provisioned ones that can cause latency. So, look before you leap – analyze past consumption rates and the future possible traffic fluctuations. Total visibility is a key to success in this case.

5. How to provide cross-functional communication in the company?

The point you can start with when building communication across departments and teams is using a FinOps approach. It presents the collaboration of people and technologies, in order to get the most value out of the cloud architecture. Additionally, it helps employees speak the same language and develop the organization’s cloud strategy.

Another way to answer staff questions about cloud deployment is by creating a Cloud Center of Excellence (CCoE). This team of cloud experts can help drive best practices and ensure the most productive optimization of the organization’s assets.

6. How to measure the success of cloud investments?

CCoE can also help you with that. However, what if there is no Cloud Center of Excellence team in your company? We suggest considering several factors, in order to evaluate your overall cloud performance.

We divided them into two main groups: financial and business factors.

Financial factors include all the points that should be taken into account when migrating to the cloud and deploying it.

Business factors present a more general view on cloud usage in the company, as it contains the cloud agility and performance improvement points.
You can read our article to examine the main points for measuring your cloud journey success in more detail.

7. What tools can I use to optimize cloud costs?

AWS, Azure, and GCP offer native cloud tools to monitor and manage your costs. Amazon Web Services offer AWS CloudWatch, Microsoft Azure monitoring tool is called Azure Monitor and Google Cloud Platform refers to its tool as Google Cloud Monitoring.

These tools are useful with the single cloud environment when the companies are devoted to one and only cloud vendor. However, in the situation when the organization deploys multiple cloud platforms and engages with several cloud providers, the monitoring process can become a nightmare.

It’s like paying for something from the separate wallets – visibility of your total spendings is almost impossible or really challenging to gain in this case.

Cloud management platforms allow users to observe the whole picture of cloud assets within multi-cloud architecture. CMPs make it easier to uncover hidden costs and make the most of your cloud. For instance, Binadox has a Cloud Utilization Dashboard that gathers all the data across a multi-cloud environment to provide total visibility of all your cloud assets.

Binadox – cloud cost optimization tool

Binadox provides businesses with features for monitoring and managing multiple cloud resources in SaaS applications and Cloud services.
With Binadox, it is easier to:

Track and analyze cloud utilization rates and costs;
Сompare cloud costs over a defined period with the Cost Explorer feature;

Identify unused, underutilized, and idle resources;
Tag multiple cloud resources for more accurate cost allocation;
Get Rightsizing recommendations based on the current workload and future possible changes.

Have more questions?

You can write to our Support team and ask for more detailed information. Also, you can register for a free 14-day trial period, test the platform unlimitedly and see how Binadox can help YOUR company.

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How to Detect Cloud Cost Anomalies

How to Detect Cloud Cost Anomalies

~5 minutes read

To stay competitive, companies devoted to the cloud should regularly deal with several things all at once: track apps’ stable performance and fix critical issues; monitor utilization rates of cloud resources and check whether they match the company’s needs; as well as compare the bills for ordered and consumed resources.

Taking control of all enlisted aspects can be overwhelming for companies. In particular, cloud costs monitoring can be a real challenge because it significantly differs from identifying other organizational costs and requires extra attention.

Besides the fact that companies can scale cloud resources at any time makes it difficult to accurately predict monthly cloud expenditures and fit in within the allocated budget. It is no wonder that companies start paying attention to “unexpected” cloud spikes only after paying huge bills.

In this article, we will cover reasons why such cost anomalies happen, discover ways to detect them and talk about possible solutions to this problem.

Why do cost anomalies happen?

To start with, a cost spike or anomaly is the rapid increase of cloud resources cost for a definite period of time. The situation with skyrocketing cloud costs got worse due to the pandemics when the majority of employees had to work remotely and started deploying cloud services more actively.

The main reason why cost anomalies occur in cloud computing lies in the lack of cost control. It’s easy to lose track of cloud spendings and rather problematic to identify wasteful resources, especially for large companies and enterprises.

We referred to the survey conducted by autonomous monitoring company Anadot to get more solid ground for the research. Here is what we’ve discovered: 77% of businesses with more than $2 million in cloud costs claimed that they were surprised by the sum they’ve spent on their cloud architecture.

Why is it difficult to detect anomalies in cloud costs?

According to another Adadot research, approximately 80% of organizations cannot immediately detect spikes in cloud costs.

More than 25% said that it can take several days, weeks, or even months to notice a spike in cloud costs. As a result, organizations are getting enormous cloud bills on a monthly basis and starting to lose their market positions.

Well-known cloud vendors like AWS, GCP, and Azure provide their customers with daily cost reports and native cloud monitoring tools. Many companies start using them right away, without taking into account the other available options.

It seems logical: why do they need something besides the tools already provided by cloud vendors? The point is that in most cases, the deployment of these native tools isn’t convenient and effective. Let’s try to understand why.

First of all, when a company chooses native monitoring tools approach, there is a need for a specialist who is skilled enough to work with various services offered by different cloud providers. As the manual cost monitoring and analysis of cloud cost fluctuations is laborious and takes a lot of time, the process lasts longer, and, unfortunately, no one is perfect and human errors can’t be completely avoided. So, the risk of missing the cost spike in time is quite high.

Secondly, the detection of cost fluctuations becomes even more complicated in a multi-cloud or hybrid cloud environment. Each cloud provider has its own native monitoring tool and business owners can be confused a lot because of all the available dashboards and different data representations. Again, it’s time and effort-consuming practice to monitor all the cloud resources from different places with different metrics highlighted.

That’s why nowadays cloud management platforms have become more popular across organizations. The IT department can connect all the cloud platforms of several providers to CMP and have the whole picture of cloud assets utilization.

Furthermore, the on-boarding and off-boarding processes can be facilitated by the cloud management platform deployment. As the cost monitoring requires getting access to all the services across several cloud platforms, when employees leave, their access should be restricted. While in the case of CMP usage, the admin can easily add workers to the Workspace and can delete them with no effort, too.

One more reason to consider the cloud management platforms’ deployment is that they send real-time alerts to detect and resolve the anomaly. As was mentioned above, every second of inaction can cost the company a fortune, so CMPs usage is a sufficient way to identify the issue and get rid of it as soon as possible.

The ultimate solution – Binadox Cost Explorer

It’s difficult to control what you can’t see so an accurate cloud cost report is the aspect every company should always keep in mind.

Binadox offers the monitoring tool for every cloud model: single cloud, multi-cloud and hybrid cloud. Cost Explorer gives users a detailed consumption breakdown for all the cloud accounts within the organization’s cloud architecture.

It allows businesses to detect cost spikes and anomalies for a better understanding of possible workload and cost changes.

In the Cost Explorer section, you can choose the account and date to observe the expenses for a 3 days period, then select the service and see the detailed cost report. Also, here users can find the forecast of future expenses. So, planning the IT budget becomes more simple and fast with Binadox.

How long does it take you to notice a spike in cloud costs?

The sooner you’re aware of the problem, the better. So, as a few days of delayed detection leads to the increase of the cloud costs approximately by 10%, Binadox sends alerts to the specified Email addresses or Slack channels immediately after a cost anomaly occurs.

All in all, business owners who are aware of all the ongoing cloud processes can make the most rational and balanced decisions on cloud management and optimization, analyze the current situation for future improvements and be in full control of utilization and costs.

Sign up to reveal cost-saving opportunities for your company.

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5 Best Ways to Improve Cloud Security

5 Best Ways to Improve Cloud Security

~5 minutes read

More and more companies start using cloud computing and its security remains one of the most relevant topics. It’s pretty obvious why cloud security is important but understanding how to enhance it – a more complicated task. 5 steps enlisted in this article can help organizations to improve their cloud security posture management.

1. Define the responsibilities

It’s recommended to begin with clarifying responsibilities within your cloud architecture. In cloud computing, security responsibilities are divided between the organization and the cloud service provider – it’s called a Shared Responsibility Model. The vital step is to identify who is responsible for what exactly.

Customers’ and cloud providers’ responsibilities in the Shared responsibility model

It’s equally important to allocate internal responsibilities. Back in the day, the security team was one and only in charge of providing cloud security. Nowadays security responsibilities are shared throughout the company where each department takes into account the possible risks and examines the policies of the cloud services they’re using.

Every organization that once chose cloud infrastructure, despite its size, should have a Cloud Center of Excellence (CCoE) — a team in charge of supporting and developing the organization’s cloud strategy.

This team handles governing the IT infrastructure and adoption of best practices across a range of disciplines like financial management, cloud security, and compliance. You can read more about CCoE in our previous article The Main Points to Consider When Measuring the Cloud.

2. Maintain internal communication

After defining responsibilities, it’s better to keep in contact with cloud operations and security teams, as well as the other organization’s departments. Why is communication important in the workplace?

The quicker a company is notified of security threats, the quicker some actions to eliminate the problem can be taken. As a rule, CCoE is in charge of providing the expeditious delivery of the information to the right department, or person.

In addition to that, it’s beneficial to have meetings with the company members on a regular basis, where possible ways of improving the work of the organization can be discussed: strategies, pain points, solutions, crucial operational updates. Communicating openly brings clarity in some internal departments’ processes and positively affects the company’s overall productivity.

3. Gain higher visibility

Visibility of resources utilization across the entire cloud environment is one of the main drivers to improve cloud security posture management. It’s obvious that you can’t protect things that you can’t see.

Despite the fact that providers offer native cloud monitoring tools to track the number of resources used and their costs, the information given is still not sufficient enough. Besides, the monitoring process is more complex when we talk about multi-cloud or hybrid cloud environments.

Trustworthy cloud management platforms provide a complete picture of the cloud environment, regardless of its type. For instance, Binadox users get recommendations on several kinds of security misconfigurations to decide what measures should be taken.

4. Detect cloud security vulnerabilities

The majority of cloud security issues occur due to the end-users negligence: some share the access through untrustworthy applications, while others forget to log out of the account when using not a personal computer.

The manual detection of those issues requires a significant amount of time and money, as the specialists involved in completing this daunting task should be paid. Frankly speaking, nowadays manual detection is no longer an option for organizations that want to be aware of all the vulnerabilities in their cloud environment, as soon as they occur.

Even though there are many security issues detection tools in the cloud, they cannot provide users with all the required information. These tools can identify the non-compliant resource type but not the level of risk, not even mentioning giving the recommendations for the next steps.

Cloud management platforms like Binadox not only detect occurring problems but also suggest possible solutions. Advice on security vulnerabilities can be sent to an organization’s communication channels like Email, Slack, or Zendesk.

5. Solve cloud security issues

After you detected a cloud security issue, you need to find a solution as soon as possible. “Time is money” – this phrase is suitable here better than ever. Cyber Attackers are becoming more and more sophisticated and can target cloud misconfiguration vulnerabilities in the blink of an eye. This is a reason for moving to automated cloud remediation.

Actions taken in order to provide cloud security can be of 2 main types: fully automated ones and those that need human involvement. The companies usually choose the policies they want to automate, and at which level they should be automated. The CCoE team also can decide in what cases to automate policies and what cases need to be acted upon manually.

Next steps

In terms of cloud security, the ground rule is “protect, detect and respond”.

To keep your cloud architecture secure, preventive measures such as regular security checks should be taken. It helps to detect the potential security issues in the early stages, before the moment when it got too far and there is nothing left to save.

The process of detecting potential threats can be arranged by means of deploying various cloud management platforms like Binadox.

Responding to those threats is the last but not the least step. The solutions to security issues depend on the type of the problem, whether it’s network security, data encryption, or authorization issues.

Companies can facilitate the establishment of the 3 above-mentioned steps by deploying third-party tools like Binadox. It can save employees time and energy that can be used in a more productive and profitable way. Moreover, all people make mistakes and no one is fully protected here. So, let trustworthy platforms like Binadox do their job.

Stop worrying about cloud security. Sign up for a free Binadox trial, start utilizing its features and sleep tight.

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How To Optimize Microsoft Office 365 Deployment and Cost

How To Optimize Microsoft Office 365 Deployment and Cost

~5 minutes read

Microsoft Office 365 is a great set of tools that are used in almost every company. The Financial Department usually uses Excel for accounting and Power BI for visualizing and analyzing data; Word is used basically by everyone in the company; IT Department probably deploys Office 365 Data Loss Prevention (DLP) for emails and files or any other services from the Information protection category of tools; OneDrive can be used to share files with the other members of the team … the list can be continued endlessly.

Office 365 products are convenient to use and they can make the employee’s life easier. However, the situation when purchased products are not used at all or barely used is pretty common. Without close attention, the organization can spend an enormous amount of money on providing resources that do not bring any value.

According to CoreView’s survey, 56% of Microsoft Office 365 licenses are “underutilized or oversized”, among the average businesses. Situations like this create budget shortfalls and adversely affect productivity in general.

In this article, we present 5 steps that help you to make the most out of your Office 365 License.

1. Educate your staff

There can be 3 types of employees in companies:

those who know what to do and use every single feature of the Office 365 license;
those who don’t completely understand all the possibilities Microsoft Office can offer and that’s why their licenses are significantly underutilized;
and finally, those who are not familiar with this tool’s great features and they don’t use it at all.

Your staff should learn how Microsoft Office 365 works and what services are available for them within their license for increasing the efficiency of the work. Microsoft offers video training that can clarify all the benefits of the Office. You can schedule lessons and training sessions in the company to encourage participation. It’s always a good idea to use every single opportunity offered, especially when it’s free of charge.

2. Consider the purchase of various licenses

There are employees who use only Microsoft Outlook to check emails, while others need to use Office 365 several services every day to get their work done. So, there’s no need to purchase the most expensive and all-inclusive plan for everyone.

It’s recommended to learn what exactly each of the licenses offers and buy them considering the employees’ workload and needs. Perhaps advanced users will need an E5 license, but those who use only 1-2 usual Office 365 features will only require an E3 or even E1.

What’s the main difference between Office 365 licenses for enterprises? There are 3 types of licenses for enterprises:

E1 license that offers business services such as email, file storage, and sharing, Office on the web, meetings, and IM, and more. Office apps like PowerPoint, Word, Excel, OneNote, and Access (PC only) aren’t included.
In the case of E3, all the features included in Microsoft 365 Apps are available for enterprise and Office 365 E1, plus security and compliance services like Data loss prevention, legal hold, and so on.
Purchasing the E5 license, the user can enjoy all the features of Office 365 E3 plus advanced security, analytics, and voice capabilities.

The comparison of Office 365 licenses: E1, E3, E5

3. Decide whether you need a full set

Back in time organizations considered the overprovisioning of resources as a smart forward-looking move – they were concerned about an unexpected increase of the demand and wanted to be prepared for it.

Nowadays, even if cloud computing offers the possibility to buy what the company is actually intended to use, the habit to buy more just in the case remained unchanged.

As the E5 license includes maximum Office products and services, obviously it’s the most expensive one. That’s why a business should decide in advance whether it is a worthy investment, especially considering the fact that the majority of E5 licenses across the companies are underutilized. According to the CIODive, about 38% of E5 license subscriptions can be downsized to E1, in order to save money.

4. Track utilization and cost

Downsizing is a useful practice but it’s harder to perform than it may seem. First of all, companies need to monitor their subscriptions to track their utilization rates and costs. You need total visibility of the subscriptions’ usage among your staff on a daily/monthly/annual basis.

In some cases, users deploy the Office products that are included in the E1 and E5 plans. It’s obvious that the E5 license has more features but does every single member of your team really need it? What if one of the employees has left the company and didn’t need the most expensive subscription but the new member does? Or one of the team members was promoted and needs the upgraded Office license?

While keeping track of Microsoft Office 365 licenses, you need to take into account all the services that the purchased plan contains and consider the possibility of downsizing.

As we mentioned before, manual detection is not an option anymore. Speed is a key in our world these days: it’s time, money, and the possibility to develop the company and stay at the top positions among the competitors.

5. Make the balanced managerial decision

To facilitate the tracking process, some companies use SaaS subscription management software. For instance, tools like Binadox help organizations to decrease their SaaS expenses, in particular, downsize their Office 365 licenses and optimize cloud costs.

What sets Binadox apart from other subscription management software in terms of optimizing Office 365 costs?

With the Binadox platform users can:

Detect underutilized subscriptions: SaaS Utilization Dashboard provides users with information on the potential savings, underutilized Office 365 licenses, and its least deployed features.

Be aware of the next billing date: Renewals calendar displays your Microsoft Office 365 subscriptions together with dates when the next bill comes. It helps the business owners to form the IT budget, as well as get rid of the unnecessary subscriptions before the next billing cycle starts.

Track utilization rates of the purchased features: it brings clarity into what resources the company has and what sort of value it is getting out of them. Are they deployed to the maximum? Does the company actually need E5 licenses? Or can it purchase more E3 or E1 licenses instead?

Binadox, unlike the other SaaS subscription management software, allows business owners to observe how each user deploys the Office 365 license features in percent. Based on this information the platform identifies the license which matches your company’s goals best.

View the details of SaaS apps in Binadox

Get downsizing recommendations and make the final decision: Binadox users are notified of the various security issues and overspending. The platform sends the recommendation on what Office 365 license is more profitable to use. Downsizing the underutilized subscriptions gives users the opportunity to optimize cloud costs and save money.

Advice - Underutilized Features — Advice – Underutilized Features

Final recommendations

Our goal is to keep your business running and thriving. Binadox team makes the cost optimization process easier and faster. It’s not reasonable to waste money on unused resources, especially nowadays.

Keep a clear head when purchasing licenses, analyze the consumption rates and costs, provide your team with useful services but don’t buy more resources than you actually need. Use Binadox to make the right decision.

Sign up for a 14-day free trial period to learn how to get the most out of Office 365 licenses used in your company.

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The Main Points to Consider When Measuring the Cloud

The Main Points to Consider When Measuring the Cloud

~5 minutes read

Following cloud trends and keeping up with the benefits it offers is a good thing to do but you always have to think about at which cost. Businesses should constantly consider the points to measure cloud success and think of further strategic moves and ways to improve this experience.

It’s not that obvious but essential to find a tool that evaluates the benefits that the cloud brings for the company. Not only does it help to decide whether all this cloud migration idea is worth it, but it also can encourage your team members to start using new technology with open minds and hearts.

No matter what cloud management strategy has been chosen – cloud management platform deployment or native tools usage – there are several ways to measure the productivity and wellbeing of your cloud infrastructure as a whole.

One of the possible options is to create the Cloud Center of Excellence (CCoE) that takes full responsibility for working with the cloud and starts tracking the cloud Key Performance Indicators (KPI’s). The CCoE team can help the organization monitor and manage cloud costs and resources utilization rates in a more effective way. Below we consider the notion of Cloud Center of Excellence.

Cloud Center of Excellence

A Cloud Center of Excellence is a team of specialists who are in charge of various cloud processes: migration, adoption, operations, and management. This unit can be also called Cloud Competency Center or Cloud Knowledge Center.

The CCoE is tasked to implement the cloud strategy and best practices that transform the way the company uses the cloud. It presents the points to consider when assessing your cloud journey success and gives you the opportunity to see whether you get the most out of your cloud investment.

There are 2 types of factors that business owners should pay attention to for evaluating overall cloud performance:

Financial, that can be measured in monetary terms;
Business ones that include strategy and performance parameters.

We will start with the financial ones.

Financial Points to Measure Cloud

The main goal of cloud deployment lies in the improvement of the general effectiveness of the company’s performance. But what else should be considered?

We suggest starting from finding out the cost of deploying cloud architecture, namely:

The cost of running on-premises data center (and comparing it to the cloud environment);
Cost of cloud migration;
Operational costs;
If the cloud is profitable.

It helps to compare spendings on cloud and on-prem software to see what is more beneficial: to invest in traditional IT or start deploying cloud environments, or both.

On-Premises Costs

A move to the cloud is usually going alongside changing a CAPEX (Capital expenditures) financial model to OPEX (Operating expenses) to see whether the cloud is more profitable for your organization. To compare your cloud cost with the on-premises one, you need to convert the total cost of ownership of the data center into an operating cost. There are several parameters to think of below:

Cost of on-premises hardware: How much money is usually spent on servers and networking? Compare this cost for your company to the monthly and annual costs of the cloud deployment.
The lifespan of hardware: You need to think about the frequency of your IT infrastructure renovation. This allows you to calculate the monthly or yearly cost of purchasing the hardware.
Additional expenses: Keep in mind the cost of electricity, fire safety equipment, the server rooms rent, worker’s salary, and some other inevitable spendings.
Innovations: The cloud helps companies to cut down the operational costs of running on-premises IT. This gives way for innovations and allows your IT team to focus more on creative tasks and development.

Cloud Migration Costs

These points will help business owners to translate on-premises costs into cloud operating costs. So, if you’re planning to kill two birds with one stone and continue hosting applications in-house as well as use the cloud, don’t forget about development, management, and recruitment costs.

Applications rearchitecting: How much does the app’s redesign cost? Rehosting applications to get them running in the cloud involves reconfiguring them for the new cloud environment. As it takes more time and effort, it’s more expensive than the application’s initial cost – this fact is worth considering.
Management time: Compare the time management cost of on-premises and cloud architecture to realize how much money is spent on planning the IT budget and strategic development moves.
Cost of training: Consider the spending on training staff to work with the new systems and technologies, as well as hiring new specialists, which includes the searching process, interviewing, onboarding, salary, equipment, etc.

Cloud Operating Costs

One of your primary concerns for companies is to lower operational costs. This goal can be reached with the help of constant monitoring, analyzing, and optimizing cloud expenses. Here are some factors for you to pay attention to:

Monthly cloud bills: In a perfect world, forecasted costs align with real ones. Unfortunately, it’s not so common, so business owners should consider cost optimization strategies to reduce their cloud bills.
Third-party tools costs: How much do the third-party services cost? They should demonstrate the savings opportunity and help you make decisions concerning the cloud architecture deployment.
Energy costs: Even if you have recently moved from on-premises to the cloud, you still need to pay for the electricity. However, the sum should be significantly lower, as you don’t have servers in your company’s building anymore (or have less).
Budget alignment: Track your cloud cost and find out whether it matches your company’s budget or not.

Cloud Profitability

It’s good to know that your effort paid off. To evaluate the worth of cloud investments observe the points that will help you identify the profit from cloud computing deployment.

Customer growth: This factor should give you oversight on sales growth and cloud implementation correlation.
Savings: How much money the cloud architecture saved for your company? Try to assess the general profit of cloud utilization.
Operating cash flow: Did you notice the increase in cash flow due to the switch from CAPEX to OPEX? Members of the finance team can and should answer this question. Moreover, this factor is recommended to be regularly checked in your company by CCoE experts, if there are some in the company.

Business Points to Measure Cloud

Consideration of financial factors is vital but it’s also beneficial to take into account other cloud aspects too. For instance, it may include better performance or agility that leads to business development in a long-term perspective.

In this section, we will talk about non-financial aspects connected to cloud management strategy and optimization of cloud architecture such as:

Cloud management;
Automation in the cloud and how it facilitates ongoing processes in the company;
Customer satisfaction;
Stakeholder buy-in and involvement.

These factors can give you a broader holistic view of your cloud environment. So, business measuring points in this case include:

Cloud Management

The cloud is scalable and that is one of the main advantages of this type of IT environment. However, many companies start suffering from uncontrolled cloud sprawl, as the scaling possibility of the cloud is infinite. A solid cloud management strategy is an indispensable condition of keeping cost and security stable.

Cloud visibility: Can you claim that you have total visibility over your cloud assets? Not only it concerns the finances of the company but also resources like capacity, storage, power, etc.
Cost optimization: Are you making the most of your cloud infrastructure? If you have unused and underutilized resources, find a way to easily detect and eliminate wasteful resources to optimize your cloud costs.
Cost allocation: Do you know which of the company’s departments is the most cost-effective? Cost allocation across teams, as well as chargeback and showback policies implementation brings more clarity and facilitates bills reducing processes.
Billing: Do you take full advantage of special offers or discounts like Reserved Instances? These practices may help you reduce your cloud bills.
Reporting: How does the reporting system work in the company? Is it accurate?
Compliance: Are you sure your company meets all regulatory standards for your industry? Compliance is a serious matter which goes hand in hand with security, so it’s recommended to not ignore it.

Automation in Cloud

Automation of all the processes if it’s safe for overall performance is recommended in cloud architecture. The reduction of manual workload may not only save your IT team members time for implementing more relevant tasks but also minimize the occurrence of human errors.

Resource optimization: Are you analyzing your past utilization rates to choose the right size of an instance when buying it? Can you scale them any time you need? Do you consider scheduling or do you need them up and running 24/7? Automation is recommended to perform these processes to simplify your life in the cloud.
Resource health: Is it possible for your company to automatically terminate unhealthy instances and adopt healthy ones?

Customer Satisfaction

By focusing on the development of your IT and cost optimization you can leave one factor unnoticed – how much your customers enjoy their interaction with your business?

Application latency: Did the situation with loading speed improve due to cloud migration or not
Customer support: To cut down the number of support queries, provide your customers with all crucial information – create FAQ section on your website, form a knowledge base, write a guide, or manual.
Customer satisfaction rates: Do your customers give you positive feedback on service performance and effectiveness? Do they write reviews mentioning pleasant user and buyer experience? Are they coming back? (if the answer for all 3 questions is “YES”, you’re doing a great job! Keep going!).

Stakeholder Interest

Changes are threatening in most cases, so business owners should think about their staff attitude towards moving to the cloud. It’s vital to demonstrate the positive sides of cloud computing deployment and get everyone acquainted with your cloud migration plan.

Training: Do you provide your employees with all useful information? What kind of educational program did you prepare for them? This is a great point for your CCoE to start interacting with the teams across the company and inform them of various cloud processes.
Collaboration: Are the several tools, services, or knowledge shared across the staff in your company? CCoE should make it one of the highest priorities for more productive and well-organized work.
Stakeholder feedback: Do all the members of the company’s leadership have a full understanding of the cloud operations’ impact on the organization? It’s recommended to give your leadership team all the details concerning cloud migration, adoption, and ongoing processes.

How to Integrate These Recommendations in Your Company

We dived deeper into cloud journey experience and presented several factors that should be tracked by your CCoE. But what is the following step? What to do if the company doesn’t have CCoE? If it has one, how to facilitate all the processes and save money and time?

Third-party tools as cloud management platforms (CMPs) can monitor the utilization and costs of your applications, ensure compliance adherence, recommend how to reduce spendings, and provide better security of your cloud environment. Additionally, CMP can help you with reaching greater visibility to simplify the process of decision-making.

Cloud management platform Binadox can help companies to deal with all of these tasks, even in multi-cloud architecture:

Cost Explorer feature makes you consider the amount of money spent on various services and applications, taking into account if the resources are unused, idle, or underutilized;

The Advice section identifies the weak spots of your SaaS applications (like security issues or overspending) and gives you recommendations;

Rightsizing feature helps companies to track the instances consumption rates and allows to form rightsizing recommendations to increase or decrease instances size;

Try Binadox for the 14-day trial period for FREE and start deploying your cloud architecture to the fullest extent.

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Hetzner Integration

Hetzner Integration

~5 minutes read

It’s enough to have Hetzner account credentials to integrate it with Binadox.

1. Log into your Binadox account.

2. There are two main flows to connect a cloud account.

In case when you have no cloud accounts connected yet, click Home in the navigation pane on the left. Choose a cloud account you want to connect to and click the Connect button.

In case you have connected cloud accounts, click Home in the navigation pane on the left. Select the Cloud providers card and click the Manage button. In the Cloud Utilization Dashboard, click the Add Account button in the Cloud Accounts tab.

Click on the Hetzner icon.

3. You will be redirected to the Connection page. Enter Login and Password in the empty fields and click Connect.

Note: You will be able to view Hetzner expenses data for the past 60 days in Binadox immediately after integration.

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Rightsizing Guide

Rightsizing Guide

~5 minutes read

In the Rightsizing section on the Binadox platform you can:

Create recommendations considering the workload.
Send recommendations to the ticketing system for your IT team to drive corrective actions.

How does it work?

To rightsize the resources proceed to the Rightsizing section (side menu > Cloud Providers > Rightsizing) and click on the Create Recommendation button.

After filing in the required parameters, the system starts forming the recommendation.

Once the recommendation is formed click on it to see further details and consider sending the recommendation to the connected ticketing system.

Step by step instruction

1. Create new recommendations

Note:

Only an admin can create or delete the recommendation

To start receiving Rightsizing recommendations an admin needs to proceed to the Side menu > Cloud Providers > Rightsizing.

The Rightsizing page includes the list of Rightsizing recommendations and the Create Recommendation button allows forming a new one.

Once the admin clicks on the Create Recommendation button a new window appears. In this window, the admin needs to select the required parameters and specify the details to let the system calculate the performance and form the recommendation based on the processed data.

Note:

The calculating process may take some time.

2. Check rightsizing recommendation details

Once the system completes calculations on a newly created recommendation a user needs to click on it to see more details.

On the Rightsizing Recommendation Details page, a user can find a comparison of the current and recommended costs of the resources within the cloud account.

To explore the resource details for 90 days, click on the required resource:

3. Send a Rightsizing recommendation

An admin can send a Rightsizing recommendation as a ticket through the connected ticketing system. To send a recommendation, click on the Create Tickets button.

To send tickets to the required ticketing system, an admin needs to choose the communication channel and click Create.

The list of tickets, the info on the connected communication channel, and the date tickets were sent are shown in the modal window. To see it, click on View Details.

Once tickets are sent to your IT team, they can suggest cloud optimization strategies. After the company’s leadership team made the managerial decisions, corrective actions can be driven.ctions can be driven.

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Rightsizing Feature

Rightsizing Feature

~5 minutes read

Cloud experts claim that Rightsizing is one of the most effective cloud cost optimization practices. Despite the fact that the majority of business owners understand the importance of rightsizing cloud resources, a lot of them still don’t have a clear picture of how their resources became overprovisioned, how to identify underutilized resources, and what to do next.

In this article, we’ll consider what rightsizing is, why we should rightsize and how to implement an effective rightsizing strategy to save money, and gain the maximum efficiency in the cloud.

What is Rightsizing?

Rightsizing implies increasing or decreasing the computing power or capacity of the instance. It’s a complex process that includes not only “cutting off what is odd”, as it is commonly viewed, but also proper research of the current situation, future workload forecast, and analytical sessions on best services or instance sizes to be used.

Generally, the thorough rightsizing process involves the steps listed below:

Analyzing instance performance and utilization;
Eliminating wasteful resources like idle instances;
Modifying the resources that don’t match the current workload.

Benefits of Rightsizing

Why should you rightsize? In the case of the cloud, the resources can be either downsized in order to save money, or upgraded to improve performance. So, the Rightsizing practice allows companies:

Reduce cloud costs and monthly bills
Rightsizing gives сompanies the possibility to get rid of the underutilized or unused resources. This leads to a reduction of monthly bills and thus saves the IT budget that can be reinvested in research and innovation instead.

Maximize resources utilization and improve the performance
The internet traffic can constantly fluctuate: it can increase and decrease, depending on various factors (like the season). During the Black Friday sale, for instance, the traffic grows rapidly and you may end up in a situation when there’s a lack of computing power, as you don’t need so many resources on ordinary days. The possible consequences are latency and downtime that are detrimental for the business.

You can add resources to the current ones, in order to avoid such unpleasant situations, and balance the workload across the instances for better performance.

See the whole picture and plan the IT budget more accurately
Visibility facilitates the process of budget planning. Rightsizing implies monitoring the consumption rates and spendings across the deployed cloud architecture (multi-cloud, hybrid cloud, etc.). So, it allows companies to observe the current situation in greater detail, as well as forecast the future workload fluctuations and costs.

Rightsize your cloud resources with Binadox

Using the Binadox platform for Rightsizing allows setting the estimated future workload manually. Once this is done, the platform will start analyzing the current utilization and cost and suggest ways to optimize assets.

Not only will you be able to see the whole consumption trends and costs of your cloud but also the new recommended instance sizes and their cost.

Once the recommendation is ready you can send it to your IT team to the connected communication channel (Slack, Email, Zendesk, ServiceNow, or Freshdesk) for negotiating over the required action.

To learn how to start deploying the Binadox Rightsizing feature, read The Instruction.

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August 2021 Updates

August 2021 Updates

~5 minutes read

New Feature – Cost Explorer

Now you can explore costs within a chosen cloud account in detail, as well as compare the cost fluctuations over any 3 days period. For better visualization, the info can be presented in the form of a graph (once the switch is toggled on). It facilitates more precise cost allocation, brings clarity into your cloud spendings and the number of utilized resources, also, serves as a tool that makes you reconsider your spendings and more accurately plan your IT budget.

More Cost Details

In order to provide greater visibility on Cloud cost, we added 3 more parameters to Payment Accounts:

Average Daily Spend, showing your spendings on the defined account on the daily basis;
Budget, that displays the amount of money you set for the account;
Overpayment – the sum that is beyond the planned budget.

We’ve added more info on SaaS Applications as well to make the subscriptions and licenses management process easier. Now the app details page includes:

Overview, where utilization rates are displayed;
Users, showing the details of user’s activity;
Billing tab that contains the info on the payment plan, billing period, number of licenses, their price, and currency;
Features section (available for Zoom, Office 365, and Salesforce) includes the list of additional features within the purchased package together with their utilization rate. It allows companies to decide what package is optimal to use;
Licenses tab – includes detailed info on the license type, billing period, quantity of licenses, and their cost.

Budget History

In the Cloud Utilization Dashboard section, when choosing one of the accounts, you can see the graph, showing the cloud spend over the defined period. Moreover, now you can see the Budget History – the orange area which displays the changes in spending threshold set manually. It facilitates reporting for the FinOps team and illustrates the whole picture of financial assets consumption.

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FinOps in Cloud Computing

FinOps in Cloud Computing

~5 minutes read

Since many business owners devoted to the cloud are concerned about developer productivity more than cloud costs, sooner or later they experience budget overrun.

Exactly at that moment, they start realizing that implementing cloud cost management tools is the question of the first priority. As they dig deeper into the strategies and practices that would help them to optimize cloud costs, they face the term “FinOps”.

In this article, we will give a definition to the term, outline key problems that it solves, and talk about what companies need to consider while adopting FinOps.

Let’s start with the definition.

What is FinOps?

FinOps stands for Cloud Financial Operations or Cloud Financial Management. It presents a set of particular standards and best practices for organizing collaboration of people, processes, and technology in a way a company gets the most value out of every cent spent in the cloud.

FinOps presents a collaboration of people, process and technologyb — FinOps presents a collaboration of people, process and technology

In terms of cultural perception of the term, FinOps is a mechanism that makes teams and departments take ownership of their cloud usage by means of providing better visibility into cloud cost allocation.

What problems can FinOps solve?

Since we have already mentioned cost allocation, let’s continue with that. The first and the most frequently appeared problem among cloud consumers is related to the fact that numerous cloud resources are not assigned or incorrectly assigned to the assets they belong to.

As a consequence, it creates difficulties for those who are responsible for forming financial statements and reports. Cost misallocation brings chaos in associating cloud cost bills with cost-generating objects.

While FinOps is used in the company it simplifies the process of calculating the true efficiency of the department or team and identifying the accountability for each cost item in the bill received.

Another problem lies in unexpected cloud sprawl. Cloud sprawl is the term used for describing the uncontrolled proliferation of cloud providers and Saas instances.

As an example, imagine that a company uses storage of different providers that are not fully interoperable or purchases more application licenses than needed. When referred to providers it causes data consistency challenges, when to SaaS applications – it brings unnecessary waste.

That is the reason why it’s vital to have the whole picture of what’s going on in the cloud environment of the company. FinOps works on reaching greater transparency of cloud assets to reduce bills and improve overall performance.

What do companies need to consider?

FinOps strategies should be implemented gradually. In order to make the process go smoothly, it’s better to prepare the ground in advance. There are 4 basic steps that companies are recommended to take to enjoy the benefits of cloud financial management:

4 basic steps that companies are recommended to take to enjoy the benefits of cloud financial management: visibility, optimization, management and automation

Provide total visibility – which implies constant monitoring of resource utilization rates across multiple clouds.
Focus on optimization – which means getting rid of excessive costs in the cloud resulting from overprovisioning or resources underutilization.
Master data-driven management is all about taking control of resource usage and provisioning to avoid unnecessary costs.
Establish an automation workflow that would facilitate various processes in the cloud or as an option inform users of overspending or possible policy violations.

If a company follows these steps, not only it optimizes its cloud costs but also improves employees’ productivity. Ensuring transparency of the costs generating processes in the cloud may help business owners make more reasonable decisions faster.

It will free up precious time for defining the company’s development vector instead of being trapped in a vicious circle of solving endless operational issues. In a nutshell, FinOps serves as a tool that helps companies stay at the top of their performance.

Who is responsible for FinOps?

Once a company identifies the problems, considers best practices to solve them, defines the strategy and steps required for adopting FinOps, the following question arises – who will be in charge of FinOps development? Somebody from the team or an invited specialist? What exactly will this person be responsible for?

Based on the workload and the level of expertise it’s recommended to have a person whose main duty will be to implement and keep FinOps going – no matter will that be somebody from the team or an invited expert. His or her main responsibility will be pushing FinOps processes.

Many business owners hire a Cloud Economist who is expected to be involved in:

Providing communication with cloud vendors to understand offers better and get assurances, for example, on security matters.
Making employees think about costs for the resources they utilize at the workplace with the help of showback or chargeback policies implementation.
Ensuring organization’s accountability around cloud cost by implementing KPI.

Another thing that should be kept in mind – the Cloud Economist works in collaboration with other company’s units – not in a vacuum. He or she must be constantly in touch with the company’s Executives, DevOps Team, and Finance & Procurement department.

Together they should work on providing the effectiveness of implemented policies that impact the cloud financials, operations, security, and compliance.

How to reach financial accountability in the cloud?

We have already discovered what companies need to consider while adopting FinOps and who is generally responsible for getting related processes done. Now let’s shift to the tools that would help companies to build strong relations across cloud teams in order to provide financial accountability.

Showback and chargeback

Many companies show team members how much money they spend and which resources they’re using. This approach is referred to as showback. It is usually performed by sending an invoice to departments in order to show their spending over a defined period.

After fully implementing showback, the company can consider adopting a chargeback approach. It involves not only the demonstration of the number of resources each department utilizes but also charging teams for them. Making employees responsible for the finances they use changes their behavior and optimizes cloud costs.

Tagging

This tool is an essential part of showback and chargeback implementation. A properly integrated tagging policy is one of the most effective cloud cost optimization practices. So, the relevant question is how to use tagging in the most productive way?

Tagging works if only all the assets across cloud architecture are tagged with the same keys and values, in the same format. Tags are sensitive to capitalization and misspellings, so the company should pay close attention to these factors. Otherwise, cloud cost analysis and allocation will be incorrect and misleading.

The main problem with tagging strategy lies in the differences between tag names of several cloud providers. For example, when using AWS you can tag EC2 instances with any character, but you’re not allowed to do that for the other resources.

To sum up

FinOps is an essential part of a viable cost optimization strategy. It includes a very useful set of principles, practices, and tools which help companies get a better understanding of bills they receive and allocate their resources correspondingly to the consumption rate or a workload.

Some practices may be difficult to implement especially on the basis of multi-cloud architecture. In this case, to get the most out of the FinOps, it’s recommended to use third-party applications like Binadox.

It provides visibility and simplifies the monitoring process. Moreover, the platform allows users to tag resources no matter what cloud vendor provides them. Binadox platform allows its users to detect cost anomalies and monitor services utilization in detail.

Sign up for a free 14-day trial.

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