Tracking Cloud Costs is a Strategic Necessity

Moving to the cloud is supposed to be the action any business can take to help them scale aggressively. For most companies, it comes with a fair amount of waste. Imagine signing up for a pay-as-you-go gym, but they keep charging you for classes you forgot to cancel and lockers you aren't using. That’s effectively what cloud waste is; a sad, empty locker you pay for.

Right now, the average company is wasting 25 to 35 percent of its cloud budget. That may sound high, but consider how many cloud resources your business uses. If you want to scale properly, you have to treat cloud costs at face value. They add up fast.

Killing the Zombie Resources

The biggest drain on your budget isn’t usually a surge in customers, it is waste. In the cloud, it is incredibly easy to spin up a server for a quick test and then totally forget to turn it off. These are Zombie Resources:

• Idle resources - Servers running 24/7 that only need to be active during work hours.
• Orphaned storage - Paying for cloud hard drives that are still active even though you deleted the server they belonged to.
• Overprovisioning - Buying the premium ultra package when the basic version would handle your traffic perfectly.

No More Sticker Shock

Cloud costs should not feel like a scary surprise at the end of the month. By tracking your data, you move from reactive (panicking when the bill hits) to proactive (predicting the future).

When you actually monitor your usage, you can accomplish quite a bit. 

• Predict seasonal spikes before they crash your budget.
• Catch cost anomalies in real-time.
• Set a budget that actually reflects reality.

Making the Team Accountable

FinOps is just a fancy way of saying everyone is responsible for the bill. The best way to do this is through a process called resource tagging.

Resource tagging involves assigning custom metadata to digital assets to improve organization and visibility. These digital labels allow organizations to accurately track costs by project and automate operational tasks, like shutting down development environments after hours. 

Think of it like labeling leftovers in a shared fridge. If every cloud resource is tagged with a Project Name or an Owner, you can see exactly which dev team is driving up the spend. It forces people to think about the price tag of their code before they hit deploy.

ROI and Unit Economics

Cloud management is not just about being cheap; it is about being efficient. You need to know how much cloud power it takes to get one new customer sign-up.

• Scaling right - Your bill goes up 20 percent, but your revenue goes up 50%.
• Scaling wrong - Your bill goes up 50 percent, but your revenue only goes up 10%.

Pro Tips to Start Saving Today

If you want to stop the bleeding, do these three things immediately:

Tag Everything

Make it a rule that nothing gets built without a Project and Owner tag.

Turn on Alerts

Use tools like AWS Cost Explorer or Google Cloud Billing to text you the second you hit 80 percent of your monthly budget.

Plan Ahead

If you know you will be using a server for a year, do not pay on-demand prices. On AWS,  switch to Reserved Instances; it is like buying in bulk at Costco, saving you up to 70 percent.

Would you like to see where your cloud budget is actually going? The knowledgeable technicians at L7 Solutions can help you audit your setup and find those zombie costs. Give us a call at (954) 573-1300 to start a conversation.