Cloud Wastage and Why It Is Bad

Walter Beek Finants
Walter Beek
FinOps Consultant, CEO FinAnts Europe and The FinAnts Group

In order to reduce cloud costs, we need to define Cloud Wastage. We define it as:

  • Every $ of cloud spend you can save or avoid.
  • Without incurring equal offsetting cost or unacceptable quality impact elsewhere.

On average 25% and upwards of cloud spend is wasted: taking your monthly cloud computing bill, how much savings potential would you estimate you have?

Cloud Wastage is bad as it doesn’t enable or drive any of the outcomes you want to achieve. It is wastage in the purest sense of the word: it is money thrown away.

If we can help you remove wastage, then that money can be put to much better use. You could hire more cloud experts, and truly deliver more and faster for the same cost.

The trick is to turn waste into a value added spend. That is why we say that Removing Cloud Wastage accelerates Business Transformation.

A good way to frame the potential is to translate possible savings in potentially hired additional cloud engineers. If an engineer’s cost is say $60,000 a year, how many more could you hire if you reduced your cloud costs?

Just to be clear, we are not talking about ‘spending less and as a result delivering less’. That would just be silly. No, what we are talking about is making sure you achieve your objectives well, fast and with high quality but doing that at a much lower cost.

Removing Cloud Wastage is achieved through prudent cloud cost management:

  • Maximising cost saving – ensuring you pay the lowest possible rate for your use;
  • Maximising cost avoidance – ensuring you use as little service as is required;
  • Minimising cost management overhead – ensuring you do this in the most efficient way.

An analogy with how we have learned to deal with switching off lights is a good example of what we are aiming to achieve.

The objective of electric light in an office building is to enable your teams to work while it is too dark without the help of lights. In days past, lights were left on 24/7. That was just silly as there is -0- value added from an office light while there are no people in the office. The electricity cost outside of working hours is pure wastage.

We have now learned to switch lights off automatically based on movement sensors. And we use more efficient, lower wattage LED-lights that do not break as often. We achieve the same, i.e. our teams are able to work when it is too dark without the help of lights, at much lower cost.

Removing Cloud Wastage is aiming to do exactly the same. Your teams are as well enabled as before, we just make the use of the Cloud more Cost Effective and Efficient.

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