1. Reduce the total cost of “owning” cloud resources
Cloud cost management is crucial in reducing the total cost of “owning” (TCO) cloud resources. By implementing effective cost management strategies, businesses can optimize their cloud usage and minimize unnecessary expenses. Thanks to a reduced TCO, you will free up resources for innovation and new product development.
2. Build a culture of accountability and transparency
By monitoring and analyzing cloud costs, businesses can identify areas where overspending occurs and hold responsible parties accountable. This promotes a sense of ownership among teams, encouraging them to be mindful of resource usage and make cost effective decisions.
As individuals become more aware of how their decisions impact costs, they are motivated to optimize resource utilization and find innovative ways to operate. Additionally, you achieve transparency through regular reporting on cloud costs, ensuring that all stakeholders know the financial impact of their actions.
3. Improve the performance of cloud infrastructure
Cloud cost management not only helps organizations save money but also improves the performance of their cloud infrastructure.
By implementing cost management strategies such as rightsizing and autoscaling, companies can match their cloud resources to actual usage. This ensures they are neither overprovisioning nor underutilizing resources, leading to improved performance and cost savings. Additionally, scheduling cloud resources allows businesses to allocate computing power when needed most.
Companies will be able to invest in high performance instances or services without exceeding budget limits. This allows them to leverage advanced capabilities offered by cloud providers and maximize the performance of their applications or workloads.
4. Enable better visibility and predictability
Another benefit is that you gain insights into your cloud spending patterns and can make informed decisions to optimize costs.
With the right tools and practices, organizations can track and analyze their cloud usage data and proactively optimize resource allocation. This enhanced visibility allows businesses to forecast their future cloud costs more accurately, enabling them to budget effectively and avoid unexpected expenses.
Additionally, improved predictability allows organizations to plan for scalability requirements ahead of time by analyzing historical data trends. As a result, they can avoid sudden spikes in costs due to unplanned resource demands or insufficient capacity planning.
5. Comply with organizational and regulatory standards
Compliance with organizational standards involves aligning cloud cost management practices with the company’s overall goals and objectives. This includes implementing processes and controls to monitor and track cloud spending and enforcing budgetary guidelines for different departments or business units.
On the other hand, complying with regulatory standards means meeting industry specific requirements such as data privacy laws (e.g., GDPR) or security certifications (e.g., ISO 27001). Cloud cost management is crucial in helping organizations meet these standards by providing visibility into how resources are used and identifying potential risks or non compliant activities.