Introducing Cloud Cost Intelligence for Finance

What is Cloud Cost Intelligence and why do you need it?

Organizations today are spending an exuberant amount of money on the cloud. The comfort to make changes to the infrastructure at will to increase the speed of innovation is two of the main motives of cloud adoption. But this comes at the expense of spending a lot more money in IT than anticipated. Organizations presently struggle to manage and optimize the cloud costs that have accompanied cloud adoption. A lot of their overall budget can keep flowing into cloud services even after performing cost-saving activities.

So, the questions that emerge now are- How can I show the worth of my cost optimization efforts and measure my cloud efficiency, while my overall cloud spend is growing? Now the right way to measure your cloud efficiency is to get the ability to link your cloud cost directly to the business value it drives. The idea is to change the efficiency metrics here, by aligning cost to your product architecture and business metrics.

It is a common practice to measure cost efficiency via your ‘cost per unit’ metric i.e.; ‘costs per business unit’. The motive is to get a cloud cost that aligns with your business KPIs, like features, customers, development teams, and more. This could be “cost per ad request” for an advertising market, “cost per ride” for a rideshare business, “cost per view” if you are a broadcaster, “cost per active user” for SaaS, etc.

The ‘Business per Unit Costs’ measurement differs per your business and requires tight collaboration between application, business, and the finance teams. Once the business metrics are determined, it is a cross-organizational effort to ensure cost reduction per unit over time.

Cloud Cost Intelligence helps to track cloud cost KPIs so that you can align and develop financial goals and gain greater business efficiencies. DevOps engineers who are responsible for maintaining IT budgets have a hard time improving the margins on the products sold by the company with respect to cloud cost because of a lack of visibility and tools to map cloud costs to products/services sold. Finance teams have to depend on the DevOps team to get infra cost data as per the line of business(feature/product/customer). For DevOps teams, this becomes an additional ad-hoc task, apart from their regular responsibilities. If the dependency that the Finance team has on the DevOps team gets resolved, it would save crucial time for both parties.

We have built Cloud Cost Intelligence to address this problem. It empowers business analytics and engineering professionals to surface their cloud costs in the context of their own business. It gives proper visibility of the business context behind the cloud spends so that the engineering and finance teams can make sense of whether the cloud expense growth is healthy or not. Cloud cost visibility as per different teams/product/functions/owners helps in achieving decentralization and loosens up the dependency problem between the engineering and finance teams.

Building blocks of Cloud Cost Intelligence

The engineering team that wishes to reduce the cost of its cloud infrastructure has a hard time doing so because the visibility currently provided by native solutions is siloed. The course of action to reach a solution cannot be decided by just looking at the problem, one always needs to dig in further. Native solutions such as Cost explorer don’t have the ideal visibility with respect to tags, features, and utilization metrics.

CCI provides a dashboard with a holistic view of cloud cost which includes cost trends by business units like teams, products, customers, users, initiatives, features. The user is able to easily calculate product/feature/customer saving margins and set budget thresholds.

Currently, DevOps Engineers have a hard time identifying whether the infrastructure cost is justified on the basis of the utility of the functions (department, team, features, product) that the infra supports. Providing this visibility helps them in correcting the infrastructure and architecture wherever the utility is low. The user is able to identify and optimize the infrastructure where the scope is highest.

Right now, Engineers are not able to see what they’re spending per individual feature or product within the AWS billing console. These native solutions lack the flexibility to assign costs to dynamic business structures granularly. This information with raw tags in AWS is never up to the mark. Smaller organizations might have the ability to function fine with strong tagging strategies but larger and complex organizations need the ability to allocate fully-burdened cloud costs with thousands of mapping rules.

CCI designates which costs belong to which group by sharing data with the individual product owners using tags, service metadata, etc., so their teams can take ownership of their costs. It automatically detects resources and overlay tags. The user is able to easily and intuitively able to set tags with minimum manual effort and minimum time consumption.

Benefits of Cloud Cost Intelligence

  • CCI maps the cost of the infrastructure to the utility of the feature – if the utility is low and infra cost high then the product debt is high which can be reduced. As you can make decisions about which tech debt to tackle, which feature to drop, or which pricing strategy to adopt.
  • CCI provides granular visibility into cloud spend and usage makes it easier for engineers to understand the resources required to run a particular feature and their respective costs to look for opportunities to cut down costs. Through visibility into the infrastructure, users understand utilization costs per feature per customer.
  • Solves the problem for reactive cloud billing enabling cloud budget holders to invest money into other departments of engineering- like Hiring.
  • CCI has flexible cost mappings against multiple business structures (i.e., cost center vs. role vs. product line) and delivers human-readable reporting through which you can strategically track the costs back to the business. Engineers can share these reports of infrastructure costs for specific lines of business with finance teams.
  • It enables the engineering teams to get views of the cost they are responsible for and helps the finance teams to understand the margins on business initiatives as they are on the hook for keeping those cloud costs in check.

How to get started with Cloud Cost Intelligence ?

If you want to try Cloud Cost Intelligence yourself, just schedule a demo with us and we will give you a complete walkthrough of it and tell you more about how it can benefit your organization.

If you like it, it will be up and running in your environment within 48 hours of you signing up with us. Feel free to contact us for other DevOps-related queries at contact@opslyft.com.

We will be ready with more DevOps magic in the coming weeks so do come back when you get the time!

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