How to Effectively Manage Cloud Costs This Year and Beyond

12.27.23 01:56 PM
Cloud services do bring a variety of benefits, with cost-effectiveness typically being the most touted. The

issue is that cloud costs can quickly get out of hand if companies fail to use the right approach. In a

landscape where organizations increasingly need cost-conscious strategies to protect their bottom lines,

knowing how to manage cloud expenses effectively is a necessity. Fortunately, the process is often

easier than companies expect.

How to Effectively Manage Cloud Costs This Year and Beyond

Review Vendor Pricing Information

While many companies have contracts that dictate the cost of their cloud services, reviewing the pricing

information regularly remains a necessity. As with other expense categories, the cost of services can

change over time, and they usually trend upward in response to various economic factors.

Spend time checking recent billings, existing contracts, and renewal contract pricing. That ensures your

organization is well-informed about what it’s paying and what it’s receiving in return. Plus, checking

recent bills creates opportunities to spot anomalies that may need addressing.

Conducting a price comparison is also wise if your current vendor is instituting significant price

increases. While changes to the cost could reflect an overall trend – meaning other providers may also

have upwardly trending prices – that isn’t always the case. By exploring the price of competitor services,

you may discover that a new vendor can bring your costs down significantly, and that may make

switching worth considering.

Prevent Unauthorized Growth

Once a company transitions to the cloud, many leaders, managers, and employees assume that

transitioning more than was originally intended to the service is the best choice. The issue is that

unchecked cloud service growth causes costs to increase quickly and unexpectedly, making it hard to

keep this critical expense category in check.

Have policies and procedures in place to assess whether specific activities, data, or resources genuinely

need to transition to the cloud. That way, you can support healthy growth while preventing anything

unnecessary from shifting to a cloud-based solution, making it easier to control the overall cost of


This approach also ensures that transition planning is part of the equation. Leaders, managers, and

employees can’t simply shift segments of an operation to the cloud. Instead, they must engage with a

dedicated set of decision-makers and align their requests with internal policies. That can ensure that the

proper evaluations and strategic roadmaps are developed before authorization is granted.

Audit for Unutilized or Idle Resources

Provisioned resources that are unutilized or idle can cause companies to pay more for their cloud

services than is necessary. By identifying resources that weren’t properly de-provisioned or are potential

targets for consolidation to lower resource use, organizations can potentially save a significant sum on

their cloud services.

What’s critical to remember is that saving idle resources for potential spikes or seasonal peaks isn’t

typically necessary. Autoscaling, on-demand, and load balancing features commonly available through

providers make holding that capacity unnecessary, so make sure to leverage those abilities to keep costs

down until more resources are actually required.

Derek Roush