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6 min read
Sep 6, 2023
The cloud has become an essential part of the modern enterprise. Organizations of all sizes are using cloud services to improve agility, scalability, and cost savings. However, with the increasing adoption of cloud computing, organizations face the challenge of managing cloud spend.
According to the latest Flexera State of Cloud report, 80% of companies spend over $1.2 million annually on the cloud with 32% of the money being wasted. As economic uncertainty looms, companies are looking for ways to reduce costs.
Imagine you are running a lemonade stand, where you buy all your lemons, sugar, and other materials upfront for a whole day of selling. Now, let's say at the end of the day, nearly a third of your lemonade supplies have gone unused and will go to waste. This situation is quite similar to what companies face with cloud waste!
Managing cloud spend has become a key topic for many board meetings and C-suite objectives and key results (OKRs). In recent years, cloud spending has shifted from being solely a technical issue to a board-level concern.
This article will discuss how companies have lost control over their cloud costs, how it has become a C-suite and board-level issue, and how they can bring cloud transparency back and get the best value for their cloud investment with platforms like Tailwarden.
It feels like just yesterday when cloud computing was the new kid on the block—full of promise, offering businesses freedom from the confines of physical servers and a world of scalability and agility. Fast forward to today, and it seems like the cloud has grown up way too fast, evolving into a beast with pricing models that even the cloud providers have a hard time explaining.
But it's not always the cloud providers' fault; most of the time, it's the natural side effect of company growth. As companies expanded, so did their cloud infrastructures. This upward trajectory was smooth sailing until bills began to pile up, revealing that scaling went both ways – resources, as well as costs. Operations escalated to a point where the DevOps team alone could no longer manage the complex billing invoices, ringing alarms in boardrooms and escalating the concern to the top tiers of management.
Adding to the turmoil is the lack of visibility into what’s being utilized, where, and how efficiently. This gray area, representing a substantial 66% of avoidable cloud spend, is dominated by idle or underused resources, trailed by overprovisioned resources at 59%. This lack of visibility makes it difficult to identify, and track costs at the cloud resource level and eliminate waste.
Further complicating matters is the surge in the adoption of cloud-native services, Kubernetes, and the rise of platform engineering. Cloud service usage has burst beyond the boundaries of DevOps teams, now involving frontend, backend, and even non-technical departments like marketing, sales, and finance. Consequently, decision-making has become decentralized, and cost allocation is challenging to maintain due to inadequate tagging strategy (Cloud Resource Tagging, optional?) and the absence of a defined cost ownership strategy. This gap has led to a lack of accountability, where expenses can spiral without clear checkpoints. This is where the principles of FinOps come into play, emphasizing a culture of cost ownership that has been noticeably missing in discussions around cloud spend until now.
Engineers, the folks at the forefront of utilizing cloud resources, frequently find their hands tied when it comes to taking decisive actions to control costs. The FinOps principle advocates for empowering engineers with the autonomy to govern cloud resources judiciously, fostering a proactive approach to managing costs. Sadly, this hasn't been the norm, and it is reflected in the ballooning cloud expenses we see today.
Lastly, we cannot overlook the shortfall of appropriate cloud cost management tools or the user-unfriendly interfaces of cloud provider consoles, which pose challenges even for dedicated FinOps teams.
Losing track of cloud resources is easier than you think, paving the way for wasted costs and security vulnerabilities. That's where Tailwarden steps in, offering a streamlined solution to bring your cloud costs under control.
Tailwarden is an all-in-one inventory platform that allows you to uncover infrastructure cost insights. With Tailwarden, you can view your AWS and GCP costs at the resource level and create a comprehensive inventory of all your resources. It's like a magnifying glass for your cloud landscape, ensuring no resource is forgotten—idle or unknown resources can be major contributors to cost waste and security vulnerabilities.
You can build a comprehensive cloud asset inventory, listing all your cloud resources across all regions and accounts - it's cloud-agnostic, supporting AWS, GCP, Azure, OVH, and DigitalOcean. You can also track the cost evolution of each individual resource as shown in the following screenshot:
You can also leverage the power of filters to slice and dice your resources and identify any untagged resources. With this feature, you can ensure that no resource slips under the radar.
Navigating cost allocation has never been easier. You can track costs across different metrics such as business units, features, or teams, leveraging custom views and virtual tags. These can be shared seamlessly with C-suite and board members, enhancing reporting transparency and offering better visibility into expenditure trends.
Moreover, Tailwarden was built with collaboration at its core. The platform invites different teams to engage, reflecting the understanding that cloud cost is a universal concern, impacting all company departments. Consequently, it promotes a culture of shared responsibility. The custom views enable the creation of personalized views for each team, which holistically holds their cloud resource usage and costs. This proactive approach not only empowers everyone in your organization to take decisive actions but also fosters a growing culture of cost ownership, steering your company towards more sustainable financial health.
Effective cloud cost optimization requires regular cost analysis, established budgets, and setting up alerts to maintain optimal resource usage which Tailwarden can help you achieve. However, it is important for engineers and board members to collaborate in implementing and overseeing these strategies to guarantee optimal cloud spending. Moreover, defining clear goals and objectives for cloud expenditure empowers all teams to track their progression actively, steering towards sustainable cost management.
In a landscape where every dollar counts, reclaiming control over your cloud costs is not just prudent; it's business-critical. Leveraging insights from powerful platforms like Tailwarden and fostering collaboration between boards and engineers can turn the tide, helping organizations sail towards a horizon of sustainability and economic stability.