Cost is something that everyone is aware of, whether it be managing what you spend on IT gadgets or games, to household budgets and at work it’s no different we are all aware that our employers don’t have unlimited budget (even Microsoft) to spend and have to be mindful of it. In the past we would spend a large chunk of money on a large chunk of metal (also known as physical servers) and that would be the budget for the quarter or year and we’d not really think about it until that large chunk of metal ran out of some kind of resource.

However, with the cloud and running workloads there it’s a very different beast, we need to be more aware of costs and budgets as resources running in the cloud are charged per minute, per hour and it’s not just a one of cost, it accumulates through the day, week, month, year and if your not careful it can spiral out of control.

In this article I’ll take you through the top 5 things I recommend thinking about when looking at cloud cost management and utilizing Azure Cost Management.

Understand your costs

Move to the Cloud can be challenge and there are lots to consider. As well as understanding the technical aspects of how Cloud technology works, it’s equally as important that the cost of the technology is something you understand.

Within Microsoft Azure, some regions are cheaper than others. And that’s down to a number of factors, things like how much electricity costs in that region, how much it goes to construct the datacenter etc, and it can be very tempting to choose the cheapest region as your default datacenter and deploy all your resources there but if it’s on the other side of the globe from your end users it could result in egress charges and performance issues, which could cost you a lot more than the savings you made by deploying to the cheaper region.

Also when I talk about understanding the cost of things be mindful when you are designing solutions in the Cloud, using the fastest and “best” tier of the solution is very tempting it solves any of those phone calls from you end users complaining about slow performance but it does hit your budget somewhere. For example, if you are looking to storage data in Azure, we offer three tiers, Archive, Cool or Hot.

Archive is great for data storage you need to keep but very rarely need to access, and it’s inexpensive to run.

While Hot gives you the best performance possible and is great for those heavily used production workloads but comes at a “hot” cost as well.

Knowing there is a storage solution within Azure is great, knowing there is three tiers within that solution, and all serve different use cases is even better.

Review your costs

Knowing what costs within the Cloud is a good start but you should be keeping an eye on your costs. Azure Cost Management helps to show you the current running costs and help predict where your costs will end if you continue on that usage pattern at the end of your billing cycle (typically in a month’s time).

Cost Management Report

When reviewing your costs and being aware of them is an important task, it’s not something you should obsess over. You shouldn’t need to monitor your costs daily in my opinion, it can be easy to get caught up in and start to obsess over. You should put in regular check points to review costs, to manage costs, making adjustments based on the reports but should be more of a monthly or quarterly task. I’ve seen customers obsess over keeping costs down they hinder their own cloud adoption journey and become frustrated, cost is only one factor when you think of cloud implementations, it should rarely be the driving factor.

You’ll find your own cadence that works for your organization.

Make your own reports

Within Azure Cost Management there are built in, out the box views and these are a great starting point but I can’t stress how much customizing these to show the information that is important to you will help.

I once had a customer raise a concern that using the Cost Management tool was quite time consuming and that using it was becoming a time consuming exercise for their IT department staff. When I spoke to them it turned out they’d shared a report with someone within their finance department several months ago and that Finance staff member was asking to see that data regularly to be updated. However, the IT help desk were constantly having to go in and create the report, export it, email it, etc through to the Finance staff member.

You can save reports, share them and you can even setup access rights so that people can view data within Cost Management without being an Administrator of your Azure subscriptions. Once I’d shown my customer these features, they were all a lot happier!

Setup Budgets

Watching your spend is something we all want to be able to do but we don’t want to be checking in on the spend daily or even hourly to see what the amount is at. Which is where budgets come into play. Within Azure Cost Management we can set up Budgets that will notify when you hit a certain limit. You can set up budgets at a high level, so on a subscription or as low as a resource group, giving you the flexibility to configure them where you need them. The notifications can be sent to an individual, a distribution group or even your Service Desk tool for attention, meaning you don’t have to manually log into the Azure Portal and check the level of your spending.

The budgets are only alerting notifications, nothing happens to your subscription or the resources within it if you trigger an alert. However, if you wanted something to happen to your resources, you could configure a solution via Azure Logic Apps & Azure Functions that triggers via the email notification Azure Cost Management Budgets sends out to carry out either a stop or deletion of resources as you require.

Action the Recommendations

Azure Advisor is one of the free products within Azure and it’s a great standalone product I could write a blog post on, however I wanted to call out that build into the Azure Cost Management blade is a short cut to the Azure Advisor Cost Saving Recommendations.

Within the recommendations you will find suggestions on how to optimize your virtual machines, how you could save money by down sizing them or shutting down those that are underutilized, remove unassociated public IP addresses or unprovisioned ExpressRoutes or idle virtual network gateways.

I’ve seen customers make significant savings by following the recommendations. I admit it doesn’t cover everything you need to think about when you are looking to make cost savings but it can help you start and help make you think.

Call to Action

Be aware of costs in the Cloud, know what a chargeable resource is and what isn’t. Set up a regular cadence to review your spend, configure custom reports to help you do this, so the information is readily available and consistent every time you review the reports, also implement budget alerts so that if something happens in between your reviews you can action it and not get a nasty shock when the bill comes in. Also take advantage of the free cost saving advice within Azure Advisor, it could help you save some crucial money!

Share what your organization does to help manage costs within the Cloud, we’d love to hear your stories!