Optimize Your Azure Costs To Meet Your Financial Objectives

One of the key reasons companies startup new ventures or “transform” legacy IT models with cloud computing is to meet financial objectives. Without proper planning, execution, and monitoring, what should be cost savings can actually become a financial drain. Furthermore, without proper controls in place, this can happen with surprising rapidity. 

Microsoft Azure provides several tools that help with efficiently managing your cloud to keep costs down. Azure has features to provide current cost overviews and cost forecasts, spending controls, and workload cost optimizations. Let’s take a look at some of Azure’s features. Then we will consider some actions that can help you optimize your cloud spending to start saving on costs right away.

Understanding current and future costs

To optimize your Azure costs, you first need to have insight into what you’re spending now. Then, forecast what your bill is likely to be in the future for your current and planned projects. Cost Management for Azure provides free cost management and billing functionality. It provides up to date information on current costs and can provide cost forecasting. Costs can be allocated to specific teams and projects. It is possible to set budgets and spending alerts to avoid cost overruns.

In addition to being able to understand current cloud costs, Azure has tools that help you estimate future spend as you look to add new services or optimize existing ones. Cost Management for Azure provides analytics to understand the status quo and two other tools can be used in conjunction to plan future costs. The Azure pricing calculator provides a simple interface to add the products you use and understand Azure options that might provide additional savings.

Azure’s Total Cost of Ownership (TCO) calculator is intended to provide a cost TCO comparison between an equivalent on-premise and Azure cloud system. The generated report provides a way to include datacenter costs such as electricity and even personnel costs. 

Optimizing Workload Costs

While the monitoring and management tools just mentioned can identify broad areas for resource optimization, Azure provides a couple of key tools to optimize your current system: Azure Advisor and the Microsoft Azure Well-Architected Framework. Further, taking advantage of special rates available for a spot or reserved instances or Dev/Test pricing can increase your savings.

The Azure Advisor considers a comprehensive list of Azure best practice recommendations.  It provides a personalized set of recommendations based on your system’s specifics. The Advisor can identify underutilized resources such as idle VMs, unprovisioned ExpressRoute circuits, idle virtual gateway networks… and provide you recommendations for deleting or reconfiguring your settings to reduce costs.

The Azure Well-Architected Framework considers the high-level architecture of your system and will provide best practices for cost optimization. Along with cost optimization specifically, the framework includes consideration of operational excellence, performance efficiency, reliability, and security, all of which have potential cost implications. The Azure Well-Architected Review allows you to evaluate your current system or explore possible future workload scenarios and receive personalized recommendations for improvement.

Keeping costs under control

One of the key benefits of cloud computing is the ease of access to resources that enable functionality such as autoscaling. Without a clear understanding of cost implications, such ease of access can also result in unexpected charges that can result in budget overruns.  Companies undergoing a “digital transformation” are especially prone to cost overruns. This results from engineers and developers treating cloud resources like traditional IT resources. Putting a clear governance structure in place with clear management policies and spending guardrails can help keep costs under control.

Microsoft has developed the Microsoft Cloud Adoption Framework for Azure provides an overall cloud management framework that has five key “disciplines”: cost management, security baseline, identity baseline, resource consistency, and deployment acceleration. The cost management discipline specifically seeks to reduce cloud cost risks while supporting the successful implementation of the other four disciplines. Once cost management policies are defined, cost controls and guardrails are easily implemented at the cloud-scale with Azure Policy

Getting started with cost optimization

The Microsoft Azure Well-Architected Framework recommends the following four steps to comprehensively address your systems cost optimization:

If you are not ready to do a complete overhaul on your Azure system and are looking for some easy cost optimizing wins, here are some actionable steps:

  1. Use Azure Advisor to identify and shut down unused resources
  2. Use Azure Advisor to right-size underused resources
  3. Consider reserve instances for baseline workloads and spot instances for preemptible workloads.
  4. Configure autoscaling to let Azure rightsize your infrastructure to match your actual workloads.
  5. Consider taking advantage of Azure Dev/Test pricing for your dev environments
  6. Use Azure Cost Management to set up team and project budgets and cost allocations to define and monitor spending.

Azure provides a wide range of Azure-native options when it comes to optimizing your cloud costs. You can find additional resources at the Azure cost optimization overview page. Opsani is dedicated to helping companies continuously achieve optimal cloud spend. While also maximizing performance. Learn more about how Opsani leverages machine learning algorithms to provide automated and continuous cost optimization on Azure and try for yourself with our free trial.