Measure twice and cut once: optimising cloud costs effectively

by Peter Shi

Experienced carpenters double-check measurements for accuracy before cutting a piece of wood; otherwise it may be necessary to cut again, wasting time and material.

As the proverb goes: “Measure twice and cut once”

Similarly, those experienced with cloud optimisation measure the potential savings before taking any action; otherwise thousands of hours in engineering effort can be spent for little to no result.

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To improve efficiency and boost profitability, here’s the Goldiserv 10 step process for cloud waste reduction.

1. Set a savings target

As Peter Drucker famously said: “If you can’t measure it, you can’t improve it.”

This very much applies to improving cloud spend efficiency.

2. Find the top five to ten services that incur the highest cost, relevant to the team that you’re working with

Finding the top service costs helps you avoid spending effort that is doomed to only save a tiny fraction of bill.

3. Determine how to optimise each service and estimate potential savings

The flavour-of-the-month savings method might not be the easiest or most impactful, estimate the potential savings and shortlist the ones with the highest potential.

Easier said than done as there are over a dozen ways to reduce Compute spending alone. Dozens more exist for other services such as database, storage, load balancing, and data transfer.

Cloud-native amd 3rd party tools typically reveal only 20% to 50% of total available savings opportunity. Therefore a combination of manual assessment plus tooling recommendations is required to reveal the best courses of action.

4. Estimate the effort required to realise the savings

Some optimisations take a few clicks of the mouse to deliver a 20% saving against the service.

Others require weeks of discussion, planning, and even changes in business processes.

Sort the easy from the hard and prioritise quick wins.

Also keep in mind that estimated effort is a function of the tools and methods you know and use. Asking someone who has done it before for tool or method suggestions can save weeks or months of effort.

5. Address blockers and risks

Example blockers include not knowing who is responsible for the spend, lack of time/interest, and organisational rules that restrict changes.

Risks may include uncertainty about impact to performance and availability.

6. Prioritise optimisation against other activities

Cloud cost optimisation needs to be treated like any other engineering project, otherwise it will be thrown into the “let’s do this later” backlog.

7. Implement project management practices

For results beyond simple quick wins, apply project management practices. Assign owners, agree timeframes, and hold teams accountable for results.

Adding optimisation work into task trackers also helps. These trackers should be the same ones used to manage other project work.

8. Repeat as necessary with other teams

Maybe you’ve reached your savings target, or maybe the CFO is now asking for more savings.

In any case, it’s likely that there will be more savings to be had beyond the first team you worked with.

9. Pull available commercial levers

Cloud vendors typically have programs to improve the ROI of cloud projects.

These include (but aren’t limited to) funding programs (enterprise, partner, and startup) that can be used to enhance savings.

10. Understand why cloud waste reduction projects were needed in the first place

Retroactively optimising spend may feel like putting out a fire that could have been prevented.

Without addressing root causes, excess spend is likely to be back again in 6 months’ time, needing more engineering effort to fix.

To ensure long-term cloud commercial success, consider proactive measures across tooling, process, governance, and culture.

As proactive measures are put in place, they will allow your organisation (especially the CFO) to sleep easy at night – knowing that cloud spend is being taken care of.

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Quick and simple approaches to cloud cost optimisation typically deliver a small portion of total possible savings.

To deeply and effectively optimise cloud use, consider the steps above and measure twice before you cut.

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