Cloud Sprawl: Understand the costs and impact of cloud services

Cloud Sprawl

What is Cloud Sprawl?

Cloud Sprawl refers to the uncontrolled proliferation of cloud computing resources over time. It is caused by the flexibility and immediacy of on-demand instances coupled with a lack of process control to ensure proper cost management.

This sprawling, unmanaged provisioning of thousands of different cloud resources could be purchased more cost-effectively if their use could be forecast. It is far easier to forecast fewer resources that are being used by multiple projects, which is why it’s important to be aware of your own organisation’s Cloud Sprawl.

 

How Cloud Sprawl affects organisations

Cloud sprawl impacts organisations in two ways:

  1. the cost of suboptimal resource consumption
  2. the time required to harmonise a sprawling cloud infrastructure

Spinning up new cloud servers on Amazon Web Services or Microsoft Azure can be done quickly and easily. We even built a tool that does this automatically – AWS Automator. The problem is this becomes an expensive way to buy cloud resources when instances are left running long term.

On-demand AWS pricing is up to four times more expensive than “committed-use” pricing, for example, by buying Amazon EC2 Reserved Instances.

With Amazon EC2 Reserved Instances, there is an option to stop paying for cloud resources after 12 months. However, this costs twice the hourly rate if you had committed to Reserved Instances for three years. The option to stop paying with only an hour’s notice is double again, or four times the hourly rate if you commit to Reserved Instances for three years.

When any project moves into the cloud, it takes a while to settle on the right choice of cloud resources, so the pricing model chosen initially is usually the most expensive, on-demand rate, as the flexibility to change your mind is crucial.  The trick is to harmonise this usage into a set of cloud resources whose future use can be forecast, and committed to, avoiding on-demand overspend.

Ultimately, you could be missing an opportunity to reduce costs by up to 30% by not addressing Cloud Sprawl. Savings can be even more if you are both overusing the expensive on-demand tariff and under using prior commitments.

 

How to mitigate Cloud Sprawl

The long-term procurement, management, and optimisation of a portfolio of cloud resources often are subject to a complex, competing set of objectives. So start by getting help in setting clear objectives for cloud procurement that will outlive the departure of leadership.

Then try to set down what cloud services you have, how your organisations use those services, how they are connected and how much they cost. Understanding the financial, technical, and organisational environment helps you prioritise which areas of your cloud procurement strategy need adapting to meet your set of objectives.

Now you have a clear definition of what workloads are stable and forecastable, you need a process for continually committing to those forecasts, then monitoring and optimising your utilisation. With better forecasting and insight into cloud usage patterns across your organisation, you can achieve an optimal balance between cost and flexibility.

Finally, ask yourselves if you have the tools, datasets, skills and time to analyse your cloud usage effectively? Do you have the time and ability to mentally address both the technical requirements and the financial management of these resources?

If not, you need to get a cloud specialist on board – and that’s where Digital Craftsmen come in.

 

Where to start with Cloud Sprawl

Driven by the necessity of adapting their business models to keep pace with the market, cloud intermediaries such as cloud resellers and cloud managed service providers, are able to finance your organisation’s cloud computing commitments, adjust the risk profile to suit you, i.e. do more than just service it around the fringe.  You can get a managed cloud procurement service.

The best way to take advantage of this change in the market is to start learning how to forecast your usage and position yourself as a savvy cloud buyer. A good starting point for this new approach is to take stock of your current cloud assets right now.

Digital Craftsmen helps organisations assess their current cloud strategy from a financial, security and operational perspective. Our method takes into account not just historical usage and pricing data, but the people involved.

Our service conservatively offers an initial target saving of 10%-30% on your existing annual cloud spend, subject to an initial audit where we analyse your historical usage data

Ideally suited for new clients who want to understand their existing cloud usage in depth, our solutions help you through:

  1. An in-depth analysis of your historical, current and future committed cloud usage, delivered as a PDF report
  2. Key technical and financial recommendations to optimise your existing cloud setup
  3. Specialist advice on security and automation best practice
  4. Visualise your entire cloud environment in order to understand the impact of cloud sprawl
  5. Understand your cloud usage by utilisation, commitment, persistence and cost fit

 

What are the benefits of addressing Cloud Sprawl?

Here are the main benefits of working with Digital Craftsmen to address your cloud sprawl:

  1. Cost Optimisation: Save up to 30% through technical setup optimisation
  2. Continuous Improvement: Assess, Optimise and Manage on an ongoing quarterly basis
  3. Harmonise Crowd Sprawl: On-demand usage is 4X more expensive than reserved or committed usage. We can fix these issues.
  4. Access the right expertise: We’re the managed cloud services experts. Our wide-ranging experience means we’ve tackled common issues with AWS, Azure, Google Cloud and other public cloud environments

This Cloud Sprawl Harmonisation service is the starting point for any organisation looking to identify cost savings and evaluate their managed cloud services based on the underlying data.

Contact Digital Craftsmen now by filling in the form below to speak to one of our cloud specialists and organise a consultation to see how you can mitigate Cloud Sprawl and save costs for your company.

 

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