How to Maximize Your Cloud Investment in Turbulent Times
Keep it from breaking the bank with optimization tips from Slalom and Google Cloud
Have you noticed that, while we all keep talking about the various issues that have been impacting businesses in recent years — from the pandemic to wars and political upheaval, economic uncertainty, supply chain woes, and on and on — there’s still not much solid advice available as to how to deal with all the turbulence? You may be getting tips like “streamline your operations,” “cut unnecessary costs,” or “help your employees be more productive,” but how often are you being given any concrete, actionable steps to get there?
In our three-part blog series, we hope to do just that — offer some practical guidance on how you can thrive during times of uncertainty and come out stronger on the other side. In this first installment, we’re going to look at ways to optimize costs related to your investment in Google Cloud technology.
When there’s as much upheaval as we’re currently facing, organizations often fall back on cutting costs to keep margins as healthy as possible. While this isn’t a bad approach, it has to be done intelligently. If there’s waste, it should be eliminated. But cutting back in areas that are vital to your business can set you up for trouble later on.
An explosion in cloud investments
There has been a dramatic increase in spending in cloud technology since the onset of the pandemic. This year, worldwide spending on public cloud services is expected to grow by 20.7% from last year for a total of $591.8 billion. For some organizations, cloud spend has topped $1 million per month.
The cloud has become an invaluable investment due to the flexibility and agility it lends to many of your business processes, as well as the fact that it’s an easy and economical way to keep current with the latest technology innovations. Many organizations, however, are finding that they’re spending more and more on cloud technology and losing sight of exactly where all the money is going. According to a recent article in the Harvard Business Review:
“Organizations that scrambled to move to cloud in 2020 are tidying things up and making it sustainable … Now that they’re in the cloud, it’s time to get their houses in order. They delivered for their stakeholders, but they made a lot of shortcuts and they must now figure out how to sustain this operationally. They need to mature their approaches.”
This view is confirmed by Flexera’s annual State of the Cloud Report, in which cloud decision makers were asked to self-estimate what percentage of total cloud spend is wasted in their organizations. The 2022 report cited a figure of 32%, which was up from the estimated 30% the previous two years. As noted by InfoWorld, this is not only an indication of significant waste, “but that the problem isn’t easing, year-over-year. Improved forecasting and cloud cost optimization will take on new significance as cloud usage continues to grow.”
Stop spending too much on cloud technology
So, why all the waste? Cloud platforms don’t require firm caps to be set on usage, as is typically the case with on-premises platforms. While this flexibility can be helpful in times of higher resource utilization, unfortunately, as Google’s Professional Services team has experienced, it can also lead to “something of a Wild West — where engineering spins up resources without standardized guardrails such as setting up budgets and alerts, appropriate resource labeling and a frequent cadence to view cost from an engineering and finance perspective.” It’s these guardrails that can help you rein in your spending and be sure you’re only using — and paying for — what you need.
But for guardrails to work you need both buy-in and collaboration between all your teams involved in utilizing and paying for cloud resources as well as the support of the technology itself to help those teams maintain oversight and governance. We recommend taking a three-step approach that becomes more of a continuous improvement process than a onetime exercise, starting with gaining a clear understanding of what you’re currently spending on cloud services.
- Improve visibility into your cloud costs. Cloud bills can be very confusing, and often the teams or individuals responsible for paying the bills don’t have the proper insight into who is incurring the costs and why. At the same time, the teams utilizing the cloud resources have no visibility into the costs they’re generating, so they’re not necessarily keeping tabs on their cloud spending. The Google Cloud Platform offers a variety of native tools and services to clearly identify exactly how much is being spent, by whom, and on what, and anyone in your organization can be given access to this information. This kind of transparency can help with setting quotas, budgets, and alerts to closely monitor both your current costs and spending trends so you can better forecast cloud expenses over time.
- Monitor your ongoing cloud usage. Once you know who is generating the costs and why, you can do a better job of making sure you’re using your cloud resources as efficiently as possible. Google’s Recommender service can continuously analyze current cloud usage to help optimize for performance, security, and cost. In a single console you can get recommendations to optimize your resource utilization, apply or dismiss the recommendations, and even mark applied recommendations as succeeded or failed so as to “train” the tool to provide better recommendations in the future.
- Take advantage of available pricing discounts. This is an area that many organizations miss out on because they feel they’re not able to accurately predict their cloud costs. But using the tools mentioned above, you can get to that point of being able to estimate your cloud resource usage more accurately, so you can get the most out of Google Cloud’s flat-rate pricing, per-second billing, and other volume discounting features that allow you to optimize rates for a specific service.
Bring governance to your cloud culture
These tools and process optimizations are only going to deliver the desired results if your teams are in alignment with one another, and that alignment comes from an active cloud center of excellence (CCoE). Your CCoE should be cross-functional, with representation from your C-suite, IT engineers, finance department, and other stakeholders who are involved in the planning, decision-making, and — most importantly — goal-setting when it comes to your cloud environment. This is essential for establishing clear governance and metrics, and for promoting a culture of accountability and transparency.
With Slalom, you’ll have an experienced partner to work with as you discover the areas of opportunity and commit to improving your processes and implementing change for the better. And the best news is, once you’re able to more fully understand, monitor, and manage your cloud costs, the real optimization can begin. By reinvesting the savings you’ll uncover, you can pursue new areas of innovation and improvement. We’ll discuss this in more detail in part two of this series.
Want the full story of how Slalom and Google Cloud can help you thrive in turbulent times? Download the whitepaper now.
When it comes to navigating turbulence, it pays to have strong partners to accompany you through the difficult times and beyond. Slalom and Google Cloud can help you not only save money and optimize costs but also improve efficiency and deliver a better experience for your employees, customers, constituents, and other stakeholders. Click the link above to access the whitepaper for more helpful information, such as:
- How to get started with a cloud financial management program
- Setting priorities for dramatically increasing the value you derive from your cloud investment
- Recognizing where your opportunities/challenges exist in your cloud culture
- Real-world examples of how Slalom and Google can help you optimize your cloud spend
Or if you’re ready to talk about optimizing your cloud costs with Google Cloud technology, we’re here for you.
Slalom is a global consulting firm that helps people and organizations dream bigger, move faster, and build better tomorrows for all. Learn more and reach out today.
