How Does Rightsizing Help Reduce Cloud Expenses?

Your cloud spending can quickly spiral out of control. And one of the major reasons for your rising cloud expenses is inefficient resource provisioning. Cloud computing follows a unique “pay-as-you-go” pricing model. At the onset, it might look straightforward—you only pay for what you use. But if you don’t have the IT expertise required for managing your cloud workloads, chances are that you will end up over- or under-provisioning resources. Over time, all these resources will undoubtedly shoot up your cloud expenses.

Rightsizing is a cloud computing strategy that will help you overcome this challenge. In this blog post, we will explain the concept of rightsizing while highlighting how it can help reduce your cloud expenses. Let’s start by defining it.

What is Rightsizing in Cloud Computing?

Rightsizing in cloud computing refers to the process of streamlining cloud resource allocation based on your workload requirements. It analyzes the workload to identify and rectify instances where resources are either over-provisioned or under-provisioned. This will help you reduce your cloud costs while enhancing your operational efficiency.

For example, imagine you are training a machine-learning model to classify images of cats and dogs. This project will involve feeding the model with large datasets comprising numerous photographs of cats and dogs, which requires additional storage space. And for this purpose, you decided to leverage cloud technology.

Initially, you allocated around 500 GB of storage on the cloud, expecting the dataset to be massive. But as the training progressed, you realized the actual dataset was only 200 GB. This means you have significantly overprovisioned storage resources, leading to unnecessary cloud costs. On the other hand, if you had only allocated around 100 GB at the start, you would run out of storage space, leaving you with an incomplete and faulty model.

With rightsizing, you can overcome this problem easily and effectively. A rightsizing strategy will involve monitoring your storage usage during model training, analyzing the trends, and then adjusting the provisioned storage to align with the actual requirement—around 250 GB in this example. This will ensure you have sufficient resources for the workload without overpaying for excess capacity.

Additionally, as your model training moves from the development phase to the production phase, rightsizing will continue to optimize storage by scaling resources up or down based on changing needs, such as accommodating larger datasets for retraining or reducing storage for inference-only workloads.

How Does Rightsizing Help Reduce Cloud Expenses?

There are many ways in which rightsizing can help reduce your cloud bills. For example, rightsizing will help you identify and eliminate idle resources, leverage autoscaling, and much more, all of which translate into cost savings.

Now, let’s comprehensively evaluate how rightsizing helps reduce cloud expenses.

1. Identifying & Eliminating Idle Resources:

   Imagine turning on your home air conditioning unit while leaving for your vacation. The air conditioning unit will keep running until you are back, resulting in an extremely high electricity bill. Similarly, idle resources in cloud computing environments, when left unchecked, can be a significant contributing factor to your increased cloud expenses.

   Any cloud resource that is provisioned will be billed, irrespective of whether it is idle or not. Rightsizing allows you to continuously monitor your cloud environment to identify resources that are provisioned but underutilized or sitting idle. These could be virtual machines (VMs), storage volumes, databases, or any other services that are consuming costs without delivering actual value. By eliminating such resources, you can reduce your cloud spending and align your infrastructure with your actual workload demands.

2. Leveraging Autoscaling:

   All major cloud providers come with built-in autoscaling capabilities to automatically adjust resource provisioning based on real-time demand. While rightsizing your cloud computing environment, you can leverage these autoscaling capabilities, allowing you to scale up resources during peak loads and scale them back down when demand subsides. This ensures you have the necessary capacity when needed while avoiding over-provisioning and associated costs during low-usage periods.

3. Optimizing Instance Sizes:

   When it comes to cloud computing, you must remember that VMs or instances come in various sizes and configurations with several combinations of CPU, network capacity, and storage. And different workloads will have diverse resource requirements depending on their nature and scale.

   For example:

   • A memory-intensive application like an in-memory database would require instances with higher RAM.
   • A compute-heavy workload like scientific simulations would demand more CPU power.
   • And storage-centric workloads like data lakes or media processing would prioritize higher storage capacity and I/O performance.

   Rightsizing involves carefully analyzing the performance attributes and resource utilization patterns of your workloads. And based on this analysis, it enables you to select the most apt instance type and size that offers the optimal number of resources to meet workload needs, without over-provisioning unnecessary (and costly) excess capacity.

4. Reviewing & Adjusting Resource Utilization Proactively:

   Workload requirements can change as your business needs evolve or usage patterns shift. This can disrupt your initial resource allocation, leading to resource wastage and additional expenses. With rightsizing, you will be able to review resource utilization, identify new optimization opportunities, and proactively adjust the provisioned resources. This continuous cycle ensures your cloud infrastructure remains aligned with your needs, preventing resource waste and associated costs.

5. Implementing Tagging Practices:

   Cloud computing environments often lack end-to-end visibility, and control over resources making it difficult to pinpoint elements or aspects that drive up your cloud spending. Rightsizing facilitates proper tagging and cost allocation practices, which accurately attribute resource costs to specific projects, applications, or departments. This helps you identify cost hotspots and target your rightsizing efforts where they will have the most significant impact.

6. Establishing Governance & Policies:

   Lack of proper governance and well-defined policies around resource provisioning, usage, and decommissioning are contributing factors to your increased cloud spending. However, an effective rightsizing process demands these. By complementing your rightsizing efforts with policies, guidelines, and governance frameworks, you can ensure consistent cloud resource management and reduced cloud spending.

The Importance of Rightsizing in Cloud Environments

Even in the midst of global economic uncertainty, cloud investments are showing no signs of stopping. The latest research data shows that cloud spending is expected to increase by at least 20% this year. While investments keep increasing, it is also important to make sure that you get the best return on investment from cloud technology.

Rightsizing your cloud environment and reducing your cloud expenses is the first step towards that. It is not a one-time event; instead, it should be treated as an ongoing process. With rightsizing, you can:

• Optimize your cloud resource spending.
• Utilize cloud resources effectively.
• Manage and maintain your cloud environment smoothly.
• Enhance your operational efficiency.
• Deliver a seamless user experience.

Who Should Use a Rightsizing Strategy?

This is simple. If your organization has implemented a cloud strategy in any form, you must conduct a rightsizing audit. Otherwise, your cloud expenses will soar through the roof, impacting your revenue margins.

Here are some cases where rightsizing can be extremely beneficial:

1. Organizations with limited in-house cloud expertise: If you don’t have the required internal IT expertise, you must implement rightsizing immediately. Chances are that your cloud environment already features overutilized and underutilized resources, driving up your cloud bills.
2. Organizations with large cloud bills: If your organization is experiencing inflated cloud bills, it is a clear indication to prioritize rightsizing. Inflated cloud bills stem from inefficient resource allocation and a lack of visibility, which can be addressed with rightsizing.
3. Organizations with fluctuating workloads: If your business demands vary constantly, you will greatly benefit from rightsizing. It will allow you to adjust resources based on real-time demand, ensuring you have optimal capacity during peak hours while not overpaying for idle resources during lulls.
4. Organizations with complex cloud architecture: If your organizational cloud blueprint features multi, hybrid, or enterprise clouds, you must conduct a rightsizing audit immediately. These complex cloud architectures feature numerous resources connected to each other through APIs, which can drive up the total expenditure.
5. Any organizations that are reliant on cloud services: Irrespective of the size of your business, if you are leveraging cloud services, rightsizing should be an integral part of your cloud strategy. Rightsizing ensures that your business runs smoothly by eliminating issues such as over-provisioning and under-provisioning.

Things to Consider While Implementing Rightsizing

Rightsizing is often an afterthought. When you receive a hefty cloud bill, you start checking the root cause for it. Instead, by proactively rightsizing, you can eliminate this adverse scenario altogether and experience all the benefits of cloud computing to the fullest. However, a successful rightsizing project is not as straightforward as it sounds.

Here are some key considerations for a successful rightsizing implementation:

1. Conduct workload profiling & demand forecasting: Before initiating your rightsizing project, make sure to conduct detailed profiling of your workloads to understand their resource demands, performance characteristics, and utilization patterns. At the same time, try to leverage some historical data and demand forecasting techniques to anticipate future resource needs accurately.
2. Check for application dependencies & constraints: It is important to understand the dependencies and constraints of your applications and workloads, as these might impact the rightsizing options available to you. It could include everything from data locality and licensing models to security and regulatory compliance requirements.
3. Consider the complexities of hybrid & multi-clouds: If your business is operating in a hybrid or multi-cloud model, it is extremely important to consider the complexities that come along with it, particularly in relation to rightsizing. A hybrid or multi-cloud model comprises different cloud platforms and a complex cloud architecture, which makes it difficult to use consistent rightsizing policies, tools, and processes.
4. Don’t disrupt disaster recovery & business continuity: Make sure that your rightsizing initiatives do not compromise or interfere with your disaster recovery and business continuity strategy. Therefore, it is vital to factor in the need for redundancy, failover capacity, and data protection while rightsizing your cloud resources.
5. Always conduct experimentation & pilot testing: It is better to be safe than sorry. Conduct extensive experimentation and pilot tests with non-critical workloads to validate your rightsizing approach. This will help you identify potential approaches and refine your approach.

How Gsoft Cloud Can Help with Rightsizing

More often than not, escalating cloud expenses are the result of inadequate resource management. Even though cloud technology follows a unique pay-as-you-go pricing model, if you lack IT knowledge and technical expertise, there is a high chance that you end up allocating more cloud resources than you actually need.

With Gsoft's Cloud Cost Optimization Service, you can rest assured that your cloud costs will be kept in check. Our cloud experts possess extensive technical knowledge and come with certifications from all major cloud service providers, allowing us to diligently monitor your cloud environments and proactively spot and rectify any cost anomalies.

By partnering with us, you will experience:

• Cost-effective cloud transition
• Continuous optimization and rightsizing recommendations
• Comprehensive cloud cost analysis and reporting

Summary:

Cloud computing is an indispensable element of a modern-day organization. It enables businesses to function effectively while offering a platform to scale. Even though it is extremely beneficial in many ways, ineffective cloud resource management can leave you with escalating costs and wasted resources, negating the very benefits that cloud computing promises to deliver.

Rightsizing your cloud environment is the only solution to this challenge. By optimizing resource allocation to match your workload demands, it makes sure that you don’t over-provision or under-provision resources. This not only helps reduce your cloud expenses significantly but also enhances operational efficiency.

Are you incurring high cloud costs? Want to rightsize your cloud computing environment? Reach out to our experts at www.gsoftcomm.net/contact-us/.