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How to Maximise Cost Savings with Managed IT Services for Azure

By Paul Saer

Is Azure saving you money? If not, you’re probably doing it wrong... Azure is a public cloud platform by Microsoft that has revolutionised computing by providing cost-efficient IaaS and PaaS services. However, many customers fail to realise the potential cost savings due to flawed cost-benefit analysis and lack of governance. In this blog post, we'll discuss the top five areas you can focus on to ensure you are getting the most value from Azure, or any public cloud service.

1: Are you comparing apples with apples?

When comparing on-premise computing to cloud computing, customers often make flawed cost-benefit analysis, leading to inaccurate results. This can be due to the complexity of the calculations or agendas driven by personal preferences, or IT suppliers' business preferences. Azure provides cost reduction, or cost avoidance, such as:

   - Reduced need for datacentre space, power and cooling
   - Reduced need for on-site support resources
   - Reduced cost of hardware procurement
   - No cost of shipping, or the associated environmental impacts of shipping a device to your location
   - No cost of rack, stack, cabling and configuration of the hardware
   - No cost of hardware upgrades or replacement consumable items; and
   - No cost of disposal of retired hardware.

By estimating these costs and adding them to your calculation, the value for money from using public cloud services will become more apparent. Managed IT service providers like Core can help you calculate cost savings accurately.

2: Architecture

Customers often make the mistake of using the same architecture for on-premise workloads for cloud services, which is not optimal. Understanding the platform capabilities is essential to building initially efficient services in Azure. Microsoft training and certification services can be helpful, or you can leverage the experience of a suitably qualified and experienced managed IT service provider. Core can help you architect and deliver services that maximise your cost savings.

3: Governance

A lack of governance over deployment and management of Azure workloads can lead to unexpected costs. Azure enables quick and easy deployment of workloads, which can lead to a "free for all" attitude that can burn money. This can lead to more consumption and, in the worst cases, resources that have been spun up quickly and easily for a short term requirement not being deprovisioned fully, or at all, running in the background and ultimately burning money. This approach was never allowed in the traditional datacentre environment, and it shouldn’t exist in the public cloud either. Deploying competent governance models to control deployments of workloads can save you money.

Managed IT service providers like Core can help you build and manage a suitable set of governance controls that will ensure you manage your Azure costs effectively.

4: Optimisation

Many customers fail to optimise the workloads they are running in Azure, leading to missed opportunities for savings. Azure offers a wide range of management tools that enable you to identify and optimise inefficient workloads. Core can help you optimise your workloads to focus on a ~90% utilisation model, automate workloads to turn them down when not in use, etc.

We have helped customers to automate workloads to turn them down, or off, when they are not being used. Having workloads that are only used 8 hours a day, 5 days a week, running at full capacity for 24 hours a day, 7 days a week, is a massive waste of money, and it is fairly simple to put automations in place that will manage this.

This is not a “one and done” operation, just like in an on-premise environment, things change frequently and someone needs to be regularly reviewing new and existing workloads to ensure that they remain optimally balanced.

5: Reserved Instances

Finally, let’s look at reserved instances. Most organisations have workloads that they know they will be running fairly consistently for a period of 3 years, or more, and these can benefit massively from being run on a “Reserved Instance” in Azure. Giving the commitment to Microsoft that you will be consuming this compute or storage for a 3 year period has a value to them. This aids planning of Azure datacentre capacity and commercially removes risk, so the benefit of this is passed onto the customer with savings of up to 80% in the right circumstances when compared to the standard “pay as you go” resource costs.

Having a strategy to leverage reserved instances is key, and no one can run every workload on a reserved instance without there being a financial risk, but used correctly, this option can make a significant cost saving for customers.

In conclusion, Azure is an excellent platform for saving costs, but to realise its full potential, you need to understand the cost-benefit analysis, optimise architecture, deploy governance, and optimise workloads. If you can recognise and implement these top five tips for reducing your cloud spend, your organisation will get what it was promised; a highly flexible, financially and environmentally considerate cloud computing experience that does not compromise services for your users.

Planning and deployment support

Managed IT service providers like Core can help you achieve all of these and maximise your cost savings. To learn more about how Core can help you reduce your Azure spend, watch our recent webinar on-demand or speak to one of our Azure experts for a complimentary Azure Technical Assessment.

If you want to discuss how Microsoft Azure can help to transform your business, get in touch to request an obligation-free meeting with a free assessment of your IT estate.

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