Step 1: Understand your Azure environment

List all Azure services and resources implemented in your environment and leverage the built-in Azure tools to understand utilisation across the board. Use these insights to document the function of each resource and service and the subsequent support it provides your business.

For example, you can start by exporting a list of your resources using the Azure portal or Azure CLI. Then, categorise these resources by type and usage, such as compute, storage, and networking. Next, assess each resource’s performance metrics and cost implications to understand its value to your business. 

This collated information provides you with the foundations to quickly and effectively rank and prioritise services and resources. By linking resources to specific business outcomes, you can effectively determine their importance and prioritise accordingly. 

Step 2: Usage versus pricing

Are you using the optimal pricing model that aligns to your desired business outcomes, usage patterns, and financial goals? Chances are, you’re setting up your strategy, largely taking the pricing at face value, and making sure you’re not going to overspend. This step is crucial because (surprise!) you can actually still get the maximum out of your spend and save yourself some pennies.  

To determine which pricing model is best, you need to understand the usage patterns in your environment. Try to identify any trends, peak usage times, and which resources aren’t being used as much as others.

Step 3: Time to optimise

Start with resource allocation optimisation. Think of the resource as a desk in your office that you now need to tidy up and organise; lining up your keyboard, perfectly placing your hole punch, detangling your cables and so on (your computing power and storage) so that they perfectly match the tasks you have set up for the day. Suddenly, with it all organised, you realise, ‘Who even uses a hole punch in this day and age?’ – it is redundant for completing your tasks.

Similarly, in the context of your cloud investments, this exercise helps ensure you’re not wasting money on resources that are barely used or entirely unused. For example, you might find that certain cloud storage, databases, processing power, or virtualisation software are no longer necessary, allowing you to reallocate or eliminate them for better efficiency and cost savings. 

Once your allocation is determined, you want to right-size your resources. Think of this as the office space around you and you’re Goldilocks. The office can’t be too big if your organisation is comprised of only a few people, and vice versa. So you source an office space that is suited to the number of people you currently have and any predictable scaling in the near future. Look to adjust your resources where it makes sense.  

And lastly, determine whether you should employ reserved instances, spot pricing, or a combination of both. If you’re not sure consider the following:  

  • Reserved instances: Imagine a monthly recurring meeting that requires the same people to meet in the same space – you would typically book a meeting room for this. Reserved instances operate on similar principles; committing to specific digital resources for a set period. It is more of a certainty, more predictable and consistent. 
  • Spot pricing: Conversely, spot pricing is comparable to an impromptu catch-up with colleagues in a breakout space around the office. You would use spot pricing for unpredictable, interruptible tasks that are not urgent and don’t always need to be available.  

Step 4: Monitor and tag your resources

This step is as basic as applying naming conventions and document tags to quickly identify resources, group them, and frequently monitor them as optimisation is a continuous cycle as opposed to a one-off exercise. Leverage in-built tools (provide an example of a built-in tool) where you can for real-time and ongoing insights and actionable recommendations.  

Step 5: Eliminate redundancies and manage external costs

Circling back to our imagined office space - you have got to keep it tidy at all times! Now that you know what to monitor, and where to look, you can easily reduce or remove resources that are using up costs unnecessarily (throw out all hole punches if you don’t have a paper filing system!).  

And don’t forget to factor in all those extra costs outside of Azure that contribute to your strategy. These include data transfer fees, third-party services, additional network costs and so forth.

Don't forget!

Just as we rearrange our desk space, and clean our office regularly, so should we audit and optimise our cloud investments. Conduct regular checkups to ensure you experience long-term cost savings. And don’t forget, review and revise your cloud spend against the overall strategy, because as one evolves so must the other.  

We also understand that this kind of undertaking can be arduous and time-consuming, especially when your team is smaller and thinly stretched. So we have not only developed this handy guide to help you prioritise the tasks you can do, but our hands-on team of experts are in the wings and ready to help you nail this. Simply book a free consultation and we can get you on your way.  

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Unlock your cloud's full potential: A guide to cost optimisation

Why this guide?

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