(EDITORIAL NOTE – Annotated in 2019 to show how this post fits into the FinOps cloud operating model.)
We’re proud to have released the FinOps cloud operation model! Many of the goals and concepts in this post were based on FinOps, and it’s a crucial part of achieving your cloud cost management goals for 2019 — and beyond!
Find out more about FinOps by reading FinOps: A New Approach to Cloud Financial Management.
It’s that time of year — all eyes are on 2019 budgets and planning. As you look to the future of your team and organization, we’d like to encourage you to aim high with some cloud cost management goals and KPIs that are being used by the highest performing cloud companies.
For the most efficient users of cloud, this can be as simple as aiming to increase their already-impressive savings by a modest percentage. No matter how early you are in your cloud journey, benchmarking your cloud environment and practices against these goals can inspire you to aim higher. But the best way to set yourself up for success in the new year is to start by closing the books on 2018 responsibly.
Wrap Up 2018 (With a Bow)
We liked how Joseph Daly, Director, Cloud Cost Optimization at Nationwide, reminded his teams to tend to important year-end to-dos in a fun way — with a holiday-themed poem!
The Cloud Grinch
Whatever the reason, his disbursement code budget or his shoes, the Cloud Grinch stood there on the day before the holiday season, hating cloud spend. Staring down from his cave with a sour, grinchy frown, at the warm, lighted screens below in their agile seating town. For he knew every Developer down in Developerville beneath, was busy now, forgetting to turn off their EC2s. “And they’re launching new instances!” He snarled with a sneer, “Tomorrow they leave on PTO, it’s practically here!” Then he growled, with his Cloud Grinch fingers nervously drumming, “I must find some way to keep cloud spend from coming!”
The Cloud Grinch understands that AWS is not free of charge and that direct chargeback of usage begins as soon as everyone gets back in January. Help the Cloud Grinch find the true meaning of scalable cloud infrastructure and save Nationwide significant expense by turning off your non-essential resources this holiday season!
While you don’t have to be this creative, it never hurts to remind your team to take care of their cloud environment before they sign off for a break. It’s also a good time to slip in some of your core focuses, like managing costs or responsible EC2 usage.
2019 Cloud Goal Setting
Now that you’ve taken care of wrapping up this year responsibly, let’s look at some goals and KPIs from top performing cloud companies to inspire you in the new year.
1) Avoid unnecessary costs.
It’s important to protect investments made in RIs and ensure users in your cloud environment leverage those and make conscientious choices when transitioning to the latest and great services from AWS. Start by establishing best practice guidelines, processes and workflows for your cloud environment, including dictating how and when resources are allowed to be stood up. Then ensure other practices improvements are put in place, such as centralizing your RI buying.
2) Achieve 100% allocation rate of your team’s cloud costs.
Depending on where you are in your cloud journey, this may sound impossible. But with the right data from a cloud cost management tool like Cloudability, it’s well within your reach.
3) Set cost avoidance targets for individual teams.
For example, if you have teams that use a lot of compute, storage and database resources, look at the Cloudability recommendations team-by-team for what can be rightsized (optimized by selecting the exact right instance for the workload). You can then push those targets to the teams and then follow along in the “x-timeframe” to see how they are progressing.
4) Look beyond savings.
Helping teams make intelligent decisions about the cloud needs to go beyond taking a technical approach to optimization and savings and beginning to make critical cultural changes.
Including cost avoidance goals (rather than just waste reduction) is a great place to start.
You can also introduce automated housekeeping tasks to preserve both valuable time and resources.
Other cultural shifts could include enabling people beyond your technical teams (for example in Finance or Program Management) to obtain a cloud certification to more confidently engage in discussions about cloud cost management.
When you begin to spread this new way of thinking beyond your immediate team, that’s when the really dramatic shifts begin. Establish workflows that include people outside of your organization’s technical teams, such as Finance, and you will see teams come together to deliver faster and increase their rate of innovation, while gaining financial and operational control.
Ready to make 2019 the Year of Cloud Cost Management? Take charge of your cloud spend with Cloudability. Sign up for your free trial today!