Cloud cost management, also known as Cloud cost optimization, refers to minimizing the amount of money spent on Cloud resources while maintaining the required performance and functionality levels. It involves analyzing and optimizing the usage of Cloud resources – such as computing power, storage, and networking – to reduce unnecessary spending.

The goal of Cloud cost management is to achieve maximum cost-effectiveness by optimizing the allocation of resources, improving the efficiency of resource utilization, and minimizing waste. Here are six techniques for optimizing Cloud resources.

Right-Size the Services

Right-sizing involves matching the size and configuration of resources to the specific workload requirements, such as adjusting the number and size of virtual machines or containers. The idea is to ensure that the resources allocated to a particular workload are not too small (leading to performance problems) nor too large (incurring unnecessary costs). To right-size a system, you analyze computing services and modify them to the most efficient size. However, it is difficult to manually size instances as workloads can be highly variable in terms of their performance requirements, and the optimal configuration may change over time. Determining the right mix of resources – such as CPU, memory, and storage – to meet the workload’s needs can also be challenging. Therefore, Cloud providers such as AWS provide automated optimization tools to support these efforts.

Increase elasticity

Optimizing elasticity is similar to right-sizing. However, it is a more dynamic process. Elasticity optimization is an ongoing exercise that involves monitoring demand patterns and making real-time adjustments to resource allocations. It includes leveraging Cloud features like auto-scaling, load balancing, and on-demand options to scale capacity up or down as needed. ModeOne uses microservices, with server specialization, to support its elasticity. Since various processes require different amounts of processing power. This ensures that ModeOne only pays for the resources it needs to support the workloads.  Companies can realize savings up to seventy percent by leveraging “auto-scaling” logic.

Optimize storage

Cloud providers offer multiple storage tiers at significantly different prices based on performance, size, backup, and recovery needs. Therefore, it is crucial to select the best tier for a given task to manage costs. You can reduce costs while maintaining performance and availability by identifying the most appropriate resources for specific data types. For example, AWS’s low-performance resources can cost half as much as the processing-intensive resources. ModeOne optimizes cost by hosting data pre- and post-processing in the appropriate tiers while utilizing high-performance computing to process data.

Implement a Cloud Native Design

Cloud-native design is a software development approach that optimizes for deployment and operation in the Cloud. Cloud-native applications are designed to be highly modular and scalable, allowing them to take full advantage of the benefits available in Cloud computing environments, such as scalability, elasticity, and agility. ModeOne is a Cloud-native application.

Measure, monitor, and improve

Once optimization decisions have been made, the team must regularly track and analyze Cloud costs, identify areas of inefficiency, and implement changes to extract the full economic potential of the Cloud. These four subtasks support those efforts:

• Define and enforce cost allocation tagging.
• Define metrics, set targets, and review at a reasonable cadence.
• Enable teams to design for cost.
• Assign optimization responsibility to an individual or a team.

Managing Cloud costs is like managing your personal budget: you want to maximize your resources while avoiding overspending. Techniques like right-sizing, elasticity optimization, and Cloud-native design help businesses become both frugal and smart in their Cloud usage.

Learn more about how ModeOne optimizes its Cloud environment to make the accountants smile!