The promise of cost savings continues to rank among the top reasons why organizations adopt cloud computing. However, as a recent study shows, after migration many companies find themselves spending more on cloud infrastructures than they did on their in-house data centers. Here we take a closer look at how “cost creep” arises in post-migration environments, what CIOs are doing about it, and how Primitive Logic helps clients prevent costs from spinning out of control in their own cloud migrations.
“Where Did the Savings Go?”
In a 2017 survey of CIOs, 451 Research confirmed that cost is still the number one driver for transitioning to the cloud, with 39 percent of respondents citing cost savings as their reason for adopting cloud computing.
Once the cloud migration is complete, however, overall costs can increase rapidly for two reasons:
- Increased consumption: Because cloud technology is easily accessible, people within the organization may use more resources without considering the costs of their consumption.
- Resource waste: After migration, some resources can become “orphaned” and go unused but continue to incur costs, while other resources are over-provisioned to deliver additional capacity “just in case.”
Eventually costs can escalate to the point where a cloud infrastructure becomes more expensive than the on-site resources it replaced. Fifty-three percent of the survey respondents cite cost/budget as their No. 1 pain point post migration:
Addressing the Cost Issue
As costs continue to rise, CIOs reach a point where they need a solution, and most respond in one of two ways:
- Repatriation: Thirty-four percent of survey respondents reported migrating applications and data from public clouds to either a private cloud or a non-cloud environment.
- Resource governance: Rather than backing out of their decision and bringing resources back in house, most respondents reported addressing the problem through better governance. This may take the form of policies for cloud usage, an approval hierarchy for cloud resource consumption, tracking line-of-business spending on cloud resources, or some combination thereof.
How to Prevent “Cost-Creep” in the Cloud
At Primitive Logic, we look at these post-migration pain points with the understanding that most of them are preventable.
When clients come to us for help moving data and applications to the cloud, they are sometimes surprised that we don’t dive right into the migration process. At that point, we help them understand our strategic planning process and the importance of mindfulness — of starting with what you have today and building a strategy that makes the most sense in addressing current challenges and accommodating future variables.
Recently a large healthcare organization partnered with us for a project that involved migrating their systems and data to the cloud. Upon reviewing their existing architecture and taking the time to understand their goals, we determined that it made more sense and was much cheaper to keep some of their data on site and create an integration to access that data. We built a strategy for integrating their cloud architecture with their on-premise source system to access data in real time, helping them avoid the huge costs some SaaS platforms charge for storage.
For another client, after we had migrated their data and systems to the cloud, we put governance elements in place to promote cost-efficient use of their cloud resources. We wrote and implemented scripts to automatically shut down non-production environments during non-working hours (7pm–7am and weekends) and created a simple approval process allowing users to request off-hours access when needed.
If your organization is considering a migration to the cloud, remember that taking a mindful approach can help you prevent the “cost creep” that some organizations experience. And if we can help, just give us a call.