Best Practices for Managing Cloud Costs

How I Cut Cloud Costs by $300K+ Annually: 3 Real FinOps Wins When leadership asked me to “figure out why our cloud bill keeps growing Here’s how I turned cost chaos into controlled savings: Case #1: The $45K Monthly Reality Check The Problem: Inherited a runaway AWS environment - $45K/month with zero oversight My Approach: ✅ 30-day CloudWatch deep dive revealed 40% of instances at <20% utilization ✅ Right-sized over-provisioned resources ✅ Implemented auto-scaling for variable workloads ✅ Strategic Reserved Instance purchases for predictable loads ✅ Automated dev/test environment scheduling (nights/weekends off) Impact: 35% cost reduction = $16K monthly savings Case #2: Multi-Cloud Mayhem The Problem: AWS + Azure teams spending independently = duplicate everything My Strategy: ✅ Unified cost allocation tagging across both platforms ✅ Centralized dashboards showing spend by department/project ✅ Monthly stakeholder cost reviews ✅ Eliminated duplicate services (why run 2 databases for 1 app?) ✅ Negotiated enterprise discounts through consolidated commitments Impact: 28% overall reduction while improving DR capabilities Case 3: Storage Spiral Control The Problem: 20% quarterly storage growth, 60% of data untouched for 90+ days in expensive hot storage My Solution: 1, Comprehensive data lifecycle analysis 2, Automated tiering policies (hot → warm → cold → archive) 3, Business-aligned data retention policies 4, CloudFront optimization for frequent access 5, Geographic workload repositioning 6, Monthly department storage reporting for accountability Impact: $8K monthly storage savings + 45% bandwidth cost reduction ----- The Meta-Lesson: Total Annual Savings: $300K+ The real win wasn’t just the money - it was building a cost-conscious culture** where: - Teams understand their cloud spend impact - Automated policies prevent cost drift - Business stakeholders make informed decisions - Performance actually improved through better resource allocation My Go-To FinOps Stack: - Monitoring: CloudWatch, Azure Monitor - Optimization: AWS Cost Explorer, Trusted Advisor - Automation: Lambda functions for policy enforcement - Reporting: Custom dashboards + monthly business reviews - Culture: Showback reports that make costs visible The biggest insight? Most “cloud cost problems” are actually visibility and accountability problems in disguise. What’s your biggest cloud cost challenge right now? Drop it in the comments - happy to share specific strategies! 👇 FinOps #CloudCosts #AWS #Azure #CostOptimization #DevOps #CloudEngineering P.S. : If your monthly cloud bill makes you nervous, you’re not alone. These strategies work at any scale.

Sharing some key learnings from my efforts to reduce cloud consumption costs for us and our customers using AI. Although AI helped speed up research, it did little in helping us in directly addressing the issue. We managed to find 40% savings in parts of our cloud infrastructure, leading to savings of >$10,000 per month without losing functionality by just spending 2 days on analysis. Here are my key takeaways: 1. Every expense should have an owner. If the CEO is the owner for many of these expenses, you are not delegating enough and can expect surprises. 2. Never lose track of expenses. 3. Know your workloads. Consolidating databases, changing lower environment clusters to zonal clusters, moving unused data to archival storage, stopping services we no longer use, and better understanding how we were getting charged for services were key drivers of costs. AI alone wouldn't be able to make these recommendations because it doesn't know the logical structure of your data, instances, databases, etc. 4. Review your processes to track and review expenses at least once a quarter. This is especially important for companies without a full-time CFO. Optimization is a continuous activity, and data is its backbone. Investing time and effort in consolidation, reporting, reviewing, and anomaly detection is critical to ensure you are running a tight ship. It's no longer just about top-line. The overall savings may not seem like a huge number, but it has a meaningful impact on our gross margins and that matters, a lot! Where do you start? - Go and ask that one question to your analyst you've been wanting to ask, but you have been putting it off. You never know what ROI you can get. #cloudcomputing #datawarehouse #dataanalysis #askingtherightquestions

𝗧𝗿𝗲𝗮𝘁 𝗙𝗶𝗻𝗢𝗽𝘀 𝗮𝘀 𝗮 𝘀𝗰𝗶𝗲𝗻𝗰𝗲 𝗳𝗼𝗿 𝗿𝗲𝗽𝗲𝗮𝘁𝗮𝗯𝗹𝗲 𝘀𝘂𝗰𝗰𝗲𝘀𝘀. Meet Varsha Sundar, VP of Global Cloud FinOps at Chubb and FinOps Foundation Ambassador. Having helped build and scale FinOps practices at Prudential Financial, Experian, and now Chubb, she's developed a scientific methodology that consistently delivers results - her first optimization project alone achieved $1.3M in annual savings. Listen now on:  Apple: https://lnkd.in/gUDAgJCT Spotify: https://lnkd.in/gSC7YsFt YouTube: https://lnkd.in/gK4xBjGc Sedai Website: https://lnkd.in/gQ5J_keM In our conversation, Varsha shares:  🔵 A step-by-step scientific framework for turning FinOps hypotheses into proven savings  🔵 The art of balancing performance requirements with cost optimization  🔵 How to effectively integrate both automated tools and human expertise in cloud management  🔵 Essential skills and practical experience needed for FinOps career success  🔵 The evolution of FinOps practices and tools in the industry  🔵 The potential of AI in cloud cost estimation and management Key Takeaways: 1️⃣ Treat every optimization like a scientific experiment. Start with a hypothesis, test in sandboxes, document your proof-of-concepts, and scale gradually from development to production. This methodical approach not only delivers better results but builds credibility with engineering teams. 2️⃣ Build proof before seeking buy-in. Start small, document detailed proof of concepts, understand stakeholder perspectives, and implement changes gradually. Your data and test results become your strongest allies in driving organizational change. 3️⃣ Success comes from merging science with practice. True FinOps mastery requires getting your hands dirty - running experiments, building business cases, and learning from real-world implementation. Theory alone isn't enough; you must combine rigorous methodology with practical experience. 4️⃣ The future of FinOps belongs to intelligent automation. Imagine AI systems that can instantly predict the cost implications of cloud migrations or proactively identify & capture optimization opportunities. This transformation will make cloud costs more transparent and predictable for teams transitioning from on-premises environments. #FinOps #CloudOptimization #CloudArchitecture #DevOps #GoAutonomous

Gaining the right visibility on your cloud spend starts with bridging the gap between expectation and reality, and asking the right questions. Let me explain: Imagine this: Your Dev and QA spend is 60% of your bill, while Production is 40%. Your CFO makes a budget forecast based on what other companies do and models it as 70% Production and 30% Dev and QA. The numbers might differ, but the point still stands. The problem isn’t just overspending. It’s the disconnect between expectation and reality. Here’s how to bridge that gap: 1) Visibility begins by asking the toughest questions: - Why is production only 40% of our costs when we modeled it at 70%? - Why is Dev and QA double what we expected – from 30% to 60%? Tough questions surface the disconnect and provide clarity. Maybe Dev and QA are temporarily higher due to R&D for a new product launch. Or maybe it’s inefficiency that requires tighter environments. Either way, the right questions drive trust in your data and guide the next steps. 2) Map costs dynamically To understand where your money is going, you need dynamic cost attribution – by team, application, or cost center. The data you need is often scattered: half-baked tag resources, hierarchies in systems like Workday or ServiceNow, etc. A good cost-attribution engine like Yotascale pulls it all into one place, making it easy to identify who or what is driving your spending. Once you trust your data, you can start asking the right questions and then act. 3) Forecast proactively No one wants to get called into the CEO’s office because of an unexpected 400% budget overshoot. And that’s *exactly* why proactive forecasting is important. Forecast spend daily to catch spikes before they happen. For example: - Application A has a $150K budget but shoots up to $900K. - Your tools should flag this ahead of time so you can adjust before a crisis hits. This also lets you plan for fluctuations, e.g., higher costs this month due to R&D but a steady decline after launch. The key is setting guardrails and keeping tabs consistently.

It's astonishing that $180 billion of the nearly $600 billion on cloud spend globally is entirely unnecessary. For companies to save millions, they need to focus on these 3 principles — visibility, accountability, and automation. 1) Visibility The very characteristics that make the cloud so convenient also make it difficult to track and control how much teams and individuals spend on cloud resources. Most companies still struggle to keep budgets aligned. The good news is that a new generation of tools can provide transparency. For example: resource tagging to automatically track which teams use cloud resources to measure costs and identify excess capacity accurately. 2) Accountability Companies wouldn't dare deploy a payroll budget without an administrator to optimize spend carefully. Yet, when it comes to cloud costs, there's often no one at the helm. Enter the emerging disciplines of FinOps or cloud operations. These dedicated teams can take responsibility of everything from setting cloud budgets and negotiating favorable controls to putting engineering discipline in place to control costs. 3) Automation Even with a dedicated team monitoring cloud use and need, automation is the only way to keep up with the complex and evolving scenarios. Much of today's cloud cost management remains bespoke and manual, In many cases, a monthly report or round-up of cloud waste is the only maintenance done — and highly paid engineers are expected to manually remove abandoned projects and initiatives to free up space. It’s the equivalent of asking someone to delete extra photos from their iPhone each month to free up extra storage. That’s why AI and automation are critical to identify cloud waste and eliminate it. For example: tools like "intelligent auto-stopping" allow users to stop their cloud instances when not in use, much like motion sensors can turn off a light switch at the end of the workday. As cloud management evolves, companies are discovering ways to save millions, if not hundreds of millions — and these 3 principles are key to getting cloud costs under control.

I had the opportunity to chat with Jason DiDomenico, MBA, Director of FinOps at Discover Financial Services. He shared valuable insights on how automation, waste management, and a focus on business value can transform cloud financial operations. His key takeaway? Successful optimization isn’t just about cutting costs—it's about driving long-term value for both the business and its customers. Here’s his approach: 🛠️ Categorize & Automate Waste Cleanup – Streamline cloud cost management through smart automation. 💡 Optimize for Value, Not Just Savings – True FinOps success means maximizing business impact, not just reducing expenses. 📊 Data-Driven Decisions – Use data to make better decisions that lead to sustainable, impactful results. 🌱 Efficiency Meets Sustainability – How FinOps contributes to a more eco-friendly cloud environment. 🔄 Stay Long-Term Focused – Align short-term actions with long-term business goals. If you're in cloud financial operations or looking to optimize your cloud cost management strategy, Jason’s insights offer a great blueprint for driving both efficiency and business value. His advice: Don’t wait for the “perfect moment” to start optimizing—take action now and keep refining your approach. If you’re in FinOps, cloud financial management, or simply want to learn more about driving efficiencies in the cloud, this episode is packed with actionable insights you can apply today. 🔗 Link to the full episode in the first comment! FinOps in Action is brought to you by PointFive, which empowers teams to optimize cloud costs with advanced detection and remediation tools that drive action. #FinOps #CloudFinancialManagement #CloudOptimization #DataVisibility #Collaboration #CostManagement #TechLeadership #CloudNative #CloudEngineering #Finance #Technology #CloudComputing #Leadership #BusinessGrowth

Cloud computing infrastructure costs represent a significant portion of expenditure for many tech companies, making it crucial to optimize efficiency to enhance the bottom line. This blog, written by the Data Team from HelloFresh, shares their journey toward optimizing their cloud computing services through a data-driven approach. The journey can be broken down into the following steps: -- Problem Identification: The team noticed a significant cost disparity, with one cluster incurring more than five times the expenses compared to the second-largest cost contributor. This discrepancy raised concerns about cost efficiency. -- In-Depth Analysis: The team delved deeper and pinpointed a specific service in Grafana (an operational dashboard) as the primary culprit. This service required frequent refreshes around the clock to support operational needs. Upon closer inspection, it became apparent that most of these queries were relatively small in size. -- Proposed Resolution: Recognizing the need to strike a balance between reducing warehouse size and minimizing the impact on business operations, the team developed a testing package in Python to simulate real-world scenarios to evaluate the business impact of varying warehouse sizes -- Outcome: Ultimately, insights suggested a clear action: downsizing the warehouse from "medium" to "small." This led to a 30% reduction in costs for the outlier warehouse, with minimal disruption to business operations. Quick Takeaway: In today's business landscape, decision-making often involves trade-offs.  By embracing a data-driven approach, organizations can navigate these trade-offs with greater efficiency and efficacy, ultimately fostering improved business outcomes. #analytics #insights #datadriven #decisionmaking #datascience #infrastructure #optimization https://lnkd.in/gubswv8k

The #1 problem I see in cloud cost management? Nobody knows who’s spending what. Finance sees a giant bill. Engineering sees… nothing. This gap leads to: - Unused resources running 24/7 - Teams with no idea what they’re spending - Anomalies caught too late If you want to control costs, start here: 1. Require proper tagging (and enforce it) 2. Show teams their slice of the bill 3. Align costs to products, teams, environments Visibility isn’t just a nice-to-have. It’s the foundation of accountability. You can’t fix what you can’t see.

If your cloud bill feels overwhelming, you’re not alone. With its mix of data visualizations, summaries, and trends, deciphering your bill can be challenging. However, gaining clarity is key to managing cloud costs effectively—especially as expenses rise due to the high storage demands and processing power needed to support AI and GenAI technologies.    I recently shared some tips with Morning Brew's Billy Hurley around some of the common cloud billing challenges (https://deloi.tt/4esEO0z). In fact, taking a closer look at your bill can help pinpoint major cost drivers, such as high transfer fees or over-provisioned resources. Also using tools to monitor and analyze trends in computing, storage, and data transfer can help guide informed decision-making on resource allocation.    For example, developers might inadvertently run expensive prompts in loops or leave GPU-intensive workflows active longer than necessary. Implementing usage quotas and automated alerts can mitigate these issues. Additionally, matching storage tiers to specific workloads—reserving premium tiers for mission-critical tasks while opting for basic tiers for less demanding needs—can lead to substantial savings.    If you’re interested in optimizing your cloud resources or managing cloud costs, please reach out. We can help you make the most of your hybrid cloud investment!