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5 Ways you Could be Misunderstanding Cloud Usage and Costs

Cloud | Posted on September 19, 2018

Before beginning your cloud journey, it’s important to recognize the impact that cloud usage and costs will have on your ultimate success.

A thorough gap analysis will arm you with the appropriate insights from which to make savvy decisions. It will look, in detail, at your current state and the resources needed to reach your desired destination. But too often, misunderstandings or overlooked considerations result in a flawed view. Like misplaced dominoes, early mistakes assessing needs compound during planning and deployment. The end is likely migration failure or at the very least cost overruns.

It’s also more complex than you may think, says David Brisbois, Softchoice’s Senior Manager of Assessment and Technology Deployment Serves Consulting.

“Vendor presentations make cloud usage, costs and migration seem simple until you try to use it. Then you realize it’s more complicated than you ever imagined.”

Most Common Mistakes

Although cost-usage misunderstandings are not troubling at first, Brisbois says, this is deceptive. As deployments scale past a workload or two, complexity creeps in. The effects of a poorly-executed gap analysis become evident, and it’s sometimes too late to go back.

The root of many gap analysis errors is often the traditional focus IT places on speeds and feeds. For an effective gap analysis and successful cloud journey, you must also look through a business lens.

Understand pay-for-performance

Many organizations fail to truly recognize the difference of a pay-for-performance model. This is a fundamental shift from the traditional mindset towards bigger, faster and better. You must think about use, not configuration.

Failing to make this shift can result in unexpected costs as you pay for unused resources, but also can lead to poor user experiences as you throttle resources you need. Look at performance through the business lens and tailor it to those needs, and the results you are trying to achieve. A downsizing of resources may be in order.

Also, consider that new models for cloud continue to emerge, such as “serverless computing” or function-as-a-service. At first, these models can look extremely inexpensive, but you need a deep understanding of all variables that can impact costs to fully evaluate them.

Software costs

Even at this early stage, investigate the changes required to the software you’re considering migration to Azure or AWS. Some versions of software are not cloud-ready and will need upgrades. This could be too costly, making them poor choices for migration. This is the case with versions of SQL Server, often one of the first places that are thought about moving to the cloud.

Also, think about inter-dependencies between applications. If two applications communicate with each other, migrating only one could result in performance delays and user dissatisfaction. You’ll have to consider the cost of moving both.

Security

A lot of confusion still exists around cloud security and ownership. Many organization incorrectly assume the provider owns the entire security stack. You need to recognize where the provider’s responsibility ends and yours begins. If not, it can result in unaccounted security costs and can result in costs associated with non-compliance (fees, fines, etc.)

Of course, there’s also the potential costs that come from any actual breaches that occur due to such confusion. given the importance of the data in the cloud, this is an important early consideration.

Data gravity

If you build it, data will come. Storage is rather inexpensive in the cloud, and data has a way of naturally gravitating to it. As you move more workloads to the cloud, the feeds from other tools start moving data to it as well (social media, Salesforce, analytics, etc.)

Expect this phenomenon and factor it into your gap analysis and plans. Also keep in mind that once data is in the cloud, it often remains there even after the removal of its associated workload. This ‘zombie data’ has an ongoing cost and no value.

Governance

Users have a tendency of spinning workloads up into the cloud and forgetting them there. For example, it’s not uncommon for IT to add cloud resources to support application development and fail to decommission them once the project is complete. This resulting “compute-sprawl” creates cost overruns.

As early as possible, consider who will have privileges to deploy workloads and be held accountable. This will help to avoid unexpected costs but also the game of responsibility “hot potato” that can occur between IT and lines of business.  You will need visibility and tools to monitor cloud usage, even if the budgets now rest elsewhere.

Public cloud is a fundamental shift from the traditional financial model of IT. And the technology is outpacing finance’s ability to keep up with it. Because of this, it’s more critical that IT be in control of, and aware of, all possible costs.

There’s a hidden benefit to conducting a thorough gap analysis for the cloud: spring cleaning. It is the best time to de-clutter applications, modernize and determine usage requirements. While all this will make the migration to cloud easier, it also helps right-size on-premise applications and data.

Like many IT challenges today, this biggest one around cloud cost is the speed of change. In the old world, events compelling you to look at costs came once a year or once every three years. Now, something impacts cost nearly daily. There is no silver bullet to solving this. To be prepared for the inevitable changes, IT must be able to identify all cost and usage factors and have oversight and visibility into them.

Interested in gaining greater confidence around the cloud? Download our eBook to learn how to build your own cloud strategy or optimize your existing one.

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