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The Imperative of Hybrid Cloud Cost Management

Introduction

With escalating investments in cloud technologies, organizations are seeking enhanced visibility into their spending to ensure both reliability and cost-effective management of their data center resources. As cloud adoption intensifies, the focus on cost management has pivoted towards optimizing cloud architecture, making it imperative for businesses to deploy robust cost management strategies to sidestep unnecessary expenditures and secure maximum cloud cost efficiency.

For instance, Gartner predicts that by 2022, up to 60% of organizations will use an external service provider’s cloud managed service offering, which is double the percentage of organizations from 2018. (Source)

The Influence of Cloud Cost Management Strategies

The transition to cloud infrastructure is often driven by the expectation of reduced IT costs. However, the reality of unexpected cloud cost increases can take businesses by surprise. Absent a defined management strategy, controlling these rising cloud costs can become a formidable challenge. According to a report by Flexera, 73% of companies plan to optimize existing use of cloud (cost savings), making it the top initiative for the fifth year in a row. (Source)

Best Practices for Hybrid Cloud Cost Management

Effective governance of a hybrid cloud platform involves identifying areas for optimizing cloud spend. Below are some best practices for reducing cloud costs and maximizing ROI in a hybrid cloud environment:

Optimal Workload Placement: The first step in hybrid cloud cost optimization is to determine the most suitable environment for each workload. Workloads that demand ultra-low latency or enhanced security may be more appropriate for private clouds, while those with variable demand or extensive storage requirements may be better served in a public cloud.

Identification of Dormant Resources: Achieving cloud cost optimization involves locating and consolidating inactive computing resources. This strategy includes identifying all dormant resources and combining them to reduce costs. Utilizing cloud features such as auto-scaling and load balancing can be key in efficiently managing capacity as needed.

Enhanced Visibility into Cloud Costs and Resources: Implementing robust monitoring and reporting mechanisms is essential to gain visibility into cloud costs and resource utilization. This includes tracking usage patterns, identifying underutilized resources, and optimizing resource allocation to reduce waste.

Regular Review of Pricing and Billing Information: A thorough review of pricing and billing information is a critical cloud cost optimization technique. Keeping abreast of cloud pricing and service options allows organizations to make informed decisions to optimize costs. This includes evaluating different pricing models, considering cost-saving options such as reserved instances and savings plans, and selecting the most cost-effective storage options.

Budget Setting and Usage Monitoring: Establishing budgets and monitoring cloud usage are key components of effective cost management. This involves developing consumption models to predict application or platform usage, facilitating capacity planning, and avoiding unnecessary expenditures. It also includes setting up alert systems for timely notification of cloud application expenses and leveraging discounts and performance storage options to optimize the cloud budget.

Employment of a Cloud Management Platform: A cloud management platform (CMP) can significantly enhance cost optimization by offering insights into hybrid cloud management and facilitating informed decisions regarding resource allocation. A CMP can also automate resource provisioning and de-provisioning, reducing costs by eliminating the need for manual intervention.

Scaling of Mission-Critical Applications: When scaling mission-critical applications, consider migrating components that can be horizontally scaled to the cloud, such as web or application servers in a typical three-tier web application, while maintaining essential data and transaction processing components on-premises. This hybrid cloud approach is particularly beneficial when speed is of the essence.

Adoption of a Multi-Cloud Strategy: A multi-cloud strategy is an effective approach for maximizing savings and enhancing cloud cost efficiency. By utilizing multiple cloud providers, organizations can benefit from competitive pricing and optimize costs across different platforms.

Integration of FinOps in Hybrid Cloud Cost Management FinOps, a blend of finance and DevOps, plays a crucial role in cloud cost management within a hybrid cloud environment, aiming to achieve cost optimization and maximize ROI. It fosters a comprehensive approach that bridges the gap between technical teams, finance departments, and business operations, ensuring effective cost optimization and financial transparency.
Cloud Cost Management Tools Selecting the right cloud cost management tools is essential for effective cost optimization in hybrid cloud environments. These tools provide organizations with the necessary insights and capabilities to monitor, analyze, and optimize cloud spending, featuring cost tracking, resource utilization analysis, cost allocation, and recommendations for cost-saving measures.

CloudHost: Your Partner for Hybrid Cloud Cost Management In a digital era where cloud adoption is ubiquitous, the quest for innovation should not compromise fiscal prudence. The key to addressing the conundrum of escalating cloud expenses lies in the efficacy of hybrid cloud cost management, and CloudHost emerges as a pivotal solution.

CloudHost, a leading provider of hybrid cloud solutions and managed services, offers a comprehensive suite of resources to guide businesses towards hybrid cloud cost optimization. By seamlessly integrating public, private, and edge cloud domains, our end-to-end managed service, powered by AIOps-driven cloud operations and an automated resource administration platform, ensures a streamlined hybrid cloud experience while proactively tackling cost optimization challenges. Our suite of services enhances resource utilization, while our cloud cost optimization solutions dismantle accounting barriers, enabling strategic resource allocation and optimized budgeting.
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