Article Compliance May 23, 2019

How to Add Budget Optimization and Forecasting to Your Federal Cloud Computing Strategy

Optimizing IT Budgets in the Public Sector

Cloud computing plays a key role in public sector IT modernization. Benefits of cloud adoption range from widened security and automated maintenance, to consistent, affordable availability and scalability. However, federal cloud computing strategy remains challenging when it comes to optimizing cloud costs. 
For example, a public sector organization pilots a cloud project—based on curiosity, industry pressure, or technology initiatives—and are promised low costs. Two months into the project, they receive shockingly high cloud bills. This challenge is often the result of a simple “Lift and Shift” strategy when the same parameters utilized in the data center are carried over to the cloud. “Lift and Shift” is not a winning strategy during cloud migration because the cloud has unlimited capacity.

Data Center Costs vs. Cloud Costs

In the data center, equipment often needs to be purchased as a capital expense (CapEx) to handle peak capacity, even if the equipment is rarely used. This process of predicting and capping your organization’s bandwidth is wasteful and a direct result of the limitations of the data center. Conversely, with the cloud, there is always more storage, faster servers, and practically unlimited bandwidth. You simply dial-up your capabilities and pay accordingly, as an operational expense (OpEx).
Most public sector data centers are limited by annual budgets and many budgets are subject to a “use it or lose it” policy. Then, if a budget is about to be lost, an organization will scramble to spend on equipment without necessarily knowing what they will need in the future. If a budget is too small, the data center remains underpowered. This concept is foreign in the cloud. Odds are—no matter how demanding your computing needs become—Amazon Web Services (AWS), Microsoft Azure, or Google Cloud can provide whatever you need.
Those major cloud vendors have an offering ideally suited for the “use it or lose it” crowd. AWS and Azure both offer Reserved Instances (RIs), and Google Cloud offers Committed Use discounts. In all of these environments, the organization can pre-pay for one or even three years of computing capabilities and enjoy significant discounts.
If there is a remaining budget at the end of the year, the organization can allocate some or all of it for RIs, which can be used within the following year, or three years, depending on the reservation. Assuming next year’s budget is the same or higher, prepaying for instances will result in a significant amount in the budget freed up for other purposes.

Managing Your Public Cloud Usage

The promise of the cloud is that you pay for what you use. In reality, you pay for what you order—whether you use it or not. Often, someone will spin up a new instance temporarily and forget to remove it. Or, they might attach storage to an instance, only to later remove the server and forget to remove the corresponding storage. This leads to unused and unattached resources. If your cloud bill is large enough, such charges may go unnoticed for months at a time.
Understanding your usage and optimizing your expenses is critical to achieving success. Public sector CIOs are frequently under pressure to do more with less and must be able to track and account for expenditures related to disparate accounts, projects, services, and more.
Manually managing resources can be a time-consuming process. Cloud management platforms solve that challenge by providing real-time resource management recommendations and forward-looking insights.
By implementing a cloud management platform, department leads can rapidly identify and eliminate wasteful spending. This can even be accomplished through automation which, in turn, improves workforce productivity. Automation simultaneously maximizes the return on cloud investment for finance, DevOps, and IT teams by simplifying processes and reducing manual effort in cloud management.

Start Your Federal IT Modernization with CloudCheckr—Get Cloud Smart

As the end of the fiscal year approaches, budget optimization, forecasting, and planning become critical. As stewards of taxpayer dollars, government entities are mandated to spend efficiently and defensibly.
With CloudCheckr’s utilization and optimization features, public sector departments can immediately identify wasted resources. CloudCheckr analyzes volumes of data to:

  • Recommend Reserved Instance purchases to save over the next year or three
  • Right-size existing instances and provisioned database capacity
  • Identify savings opportunities through de-provisioning idle and unused resources

CloudCheckr also provides daily cost savings reports and alerts as a quick way to check-in on inefficient provisioning and prevent unnecessary expenditures. By doing all of this, the finance department receives the cost data necessary to help IT and DevOps teams make optimal purchasing decisions and maximize resource availability.
CloudCheckr’s cost allocation tools prevent wasteful spending and inefficiencies associated with manually managing public sector deployments. By using CloudCheckr, organizations report saving an average 30% off their existing monthly cloud expenditure.
CloudCheckr is the most trusted solution to inventory management and budgetary governance in the public cloud for the public sector. Taking advantage of a cloud-based solution for intelligent resource utilization recommendations, intuitive billing/invoicing tools, and an expert set of security best practice scans is as easy as signing up for a free trial.

Interested in an individualized assessment of how CloudCheckr can help maximize your year-end budget or optimize for next year? Explore CloudCheckr free for 14 days to see how deeper insights can drive organizational efficiencies for your teams.