Avoiding the unexpected costs of cloud computing. Without proper planning and governance, spending on cloud services can easily get out of control, putting your organization at risk of not realizing the benefits of moving to the cloud in the first place. This presentation helps you understand the frameworks and tools available to effectively manage and optimize cloud costs.
You’ll Learn how to: (1) develop and manage optimal cloud budgets (2) assign accountabilities and track usage (3) continuously improve cost performance.
2. Your Presenters
Aaron Brooks
Director of Hybrid IT
Aaron.Brooks@softchoice.com
https://ca.linkedin.com/in/aaron-brooks-03b3068
Craig McQueen
Microsoft Practice Director
Craig.McQueen@softchoice.com
https://ca.linkedin.com/in/craigmcqueen
8. Cloud Drivers
Agility
Simplification
Optimization
• Speed to Deploy
• Choice of Consumption Model
• Access to Latest Features and Versions
• Improved Maintenance and Support
• Manage Cost/Risk
• Avoid Aged Infrastructure
• Applications
• Data
• Integration
9. Financial Barriers
Budget
Accountability
• Utility Model: OpEx vs. CapEx
• Many ways to deliver applications (SaaS,
IaaS, PaaS)
• Price is always changing
• Changing Business Requirements
• Insight into Over and Under utilized
resources
• Skills and Resources
• Provisioning
• Alignment between IT, LoB and Finance
• Cost allocation (Business and Services)
Optimization
13. Time
Trad
IT
No plan DIY
> 30% Fail
• Pilots
• 3-5 yrs
Biz • Skills gap
Manage $
• No control
Customer Experience
Manage Risk
Business Impact
Cloud
Adoption
The Cloud Challenge
14. Trad
IT
Biz
Time
No plan DIY
> 30% Fail
• Pilots
• 3-5 yrs
• Skills gap
Manage $
• No control
Customer Experience
Manage Risk
Business Impact
Cloud
Adoption
The Cloud Challenge
15. Trad
IT
Biz
Time
No plan DIY
> 30% Fail
• Pilots
• 3-5 yrs
• Skills gap
Manage $
• No control
Customer Experience
Manage Risk
Business Impact
Cloud
Adoption
The Cloud Challenge
20. Time
Spend
Budget
Actual
Clients end up spending more than twice
as much as budgeted when governance
measures not in place.
Key Challenges:
• Budget
• Accountability
• Optimization
What We’ve Seen With Our Customers
22. Budget – Characteristics
• Capex
• Fix costs impede or kill projects
• Sunk Costs: Hard to pivot
• 1-3 year planning cycle
• IT owns technology budget
• OpEx: Agility, can pivot projects
• Consumption based model
• Forecasting becomes critical
• Variable Costs
• LOBs can own some technology budget
Traditional Public Cloud
Traditional Public Cloud
25. Plan Your Public Cloud Spend Properly
Optimized Cloud BudgetTraditional Budget
• Planned for peaks
• Over provisioned
• Purchasing direct
• Plan for performance
• Right size Infrastructure
• Automation
26. • Four year useful life assumed for on-premise hardware
• Burdened at approx. 30% for environmental, space and maintenance
• Over Provision and Under Utilized
• Downtime for maintenance and feature upgrades
• Costs Historically decrease 10% year over year
• Reduced downtime for upgrades and maintenance
• No assets
• No Maintenance or Break-Fix costs
Budget Influencers When Thinking Cloud
Public Cloud
Traditional IT
28. Accountability – Characteristics
• Application use to accountability
typically clear – can map 1:1
• Can strive to shared costs if services
are used by more than one LOB
• Clear procurement/provisioning rules
• Without strategy, difficult to detail cost
allocation
• With strategy, full/partial cost allocation
is easy
• Close tie of revenue and cost
• Open provisioning leads to escalated
costs
Traditional Public Cloud
33. Governance Workshop
Availability
Business
value
Business
priority
Who makes
decisions
Why it’s
there
Who pays
the bill
Deployment
Identifier
…
Deployment Owner Purpose Steward Priority Net Benefit Operations
Active Directory IT Security CIO Critical Productivity of end users 24x7
Web Site Marketing Public information and branding CFO Critical Demand Generation 24x7
CRM Sales Manage our Customers Sales VP Normal Client Relationships 9x5
34. Optimize – Characteristics
• Resources fixed
• Scaling is slow and costly
• Limited ability to optimize costs due to
CapEx Investment
• Optimization comes by way of refresh
• Insight focused on performance vs.
spend/cost
• New Tools Required to measure:
• Spend
• Performance
• Usage
• Ongoing Optimization and right sizing
• Leveraging PaaS and App Modernization
Traditional Public Cloud
35. Forecast to Your Budget
• Set a Budget
• Tools to measure in real time
• Alert before you overspend
36. Track Spend & Allocate Costs
• Leverage Catalog
• Track Against Outcomes
• Give Visibility to Stakeholders
• Update Financial Processes
38. Breaking Through The Barriers
Budget
Accountability
Optimize
• Tool Based Budgeting
• Forecast to Budget
• Governance Workshop
• Track Spend
• Allocate Costs
• Measure Performance
• Understand Usage
• Right Size / Automate
Challenge Solution
39. Two dimensions of Cloud Success
Speed of Adoption Managing Governance
40. The Adoption –Governance Model
Realize
business
benefits sooner
Competitors take
market share
No accountability to
Cloud spend
Optimal control
over Cloud spendGovernance
Adoption
41. Exercise 1
Calculate the extend and
speed of your organization’s
cloud adoption.
SELF-ASSESSMENT
42. Exercise 2
Calculate the extent to
which your organization can
govern and manage cloud
costs.
SELF-ASSESSMENT
45. SELF-ASSESSMENT: Strengths vs. Opportunities
Hesitant Cautious
Cowboy Leader
Adoption
Governance
Speed and Agility
Run Governance Workshop
Invest in Tools to Gain Insight
Strengths
Opportunities Balanced
Continuous Improvement
Automation and Modernization
Positioned for Execution
Analyze Workloads to Create Budget
Get Started with Production App
Minimized Risk
Right Size and Optimize
Create Roadmap for Adopting Cloud
DSM: Here’s your presenters. Please make notes of any questions you have and we will be happy to answer.
See the path of financial management for azure and understand that there are tools to help.
See the path of financial management for azure and understand that there are tools to help.
TADD
According to IDC research, many companies from varied industries find public cloud as the most adaptable model and its spending reached approx. $70 billion in 2015, up 24% from 2014 to 2015 and could possibly extend to $127.5 bn by 2018 at a five-year compound annual growth rate (CAGR) of 22.8%.
Critical for sale of services…must understand this. Find ways to get the client to talk about these things.
Critical for sale of services…must understand this. Find ways to get the client to talk about these things.
TADD
In the Softchoice environment alone, our customers are overspending by $2.2m or 270% in comparison to their EA Commitments.
TADD
Deploy VMWare capacity planner tool to grab on-prem system summaries: SQL, CPU performance, etc. Then execute pricing based on Azure Rate Card. Can optimize pricing based on currency, EA, etc.
Understand your applications
Conduct assessments
Add contingency to budget
Gain experience : Get Started
Invest in tools: Cost tracking and forecasting
TADD
Who is accountable for the costs?
TADD
Who is accountable for the costs?
TADD
Who is accountable for the costs?
Conduct periodic assessments
Understand your applications
Script usage schedule
Invest in tools:
Resource usage
Megan
Shared
Cloud TechCheck
Workload Analyzer
Accellerator and Jumpstart
Governance Workshop
Customized Consulting
Managed Service
Dashboard
Size, Configuration, Visibility, and Ownership