Unlocking Savings with Effective Cloud Cost Management Strategies

Organizations are recognizing cloud's importance for long-term competitiveness and how it can enable businesses to be more agile and resilient — especially when it comes to AI adoption. However, managing cloud spend remains a top challenge for many businesses.  

For many, the savings from cloud migrations did not materialize as expected, and some even experienced a "double bubble" effect where costs simultaneously increased across both infrastructure and cloud environments due to a lack of visibility into cloud costs, the complexity of cloud billing, and a general misunderstanding of cloud consumption models that often sees users treating cloud consumption and traditional data center consumption in the same manner. 

Other reasons cloud savings may not have materialized as anticipated include:

• Overspending during lift and shift
• Unchecked cloud sprawl
• Strict adherence to a "cloud-first" approach where workloads that should have remained on-premises are migrated to the cloud
• Internal debates over Capex vs Opex pricing
• IT staff lacking cloud skills, especially across multiple hyperscalers when pursuing a multicloud strategy

Many organizations lack a resource management solution, relying on manual processes or an array of point solutions. While cloud FinOps tools can show how much money is being spent, they can't resolve issues with resource allocation. 

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What is cloud cost management?

To overcome these challenges, organizations need to adopt best practices for cloud cost management. Cloud cost management is a process that ensures businesses optimize their cloud environments, right-size their consumption commitments and reduce operating costs by gaining visibility into cloud spend across the organization. It involves managing cloud resource waste and ensuring that cloud environments are optimized from both a business and operational perspective. 

Cloud cost management can be particularly beneficial for organizations with a public cloud footprint, those new to the cloud operating model, those with large enterprise-level commitments with one or more hyperscaler, and those new to a multicloud operating model. 

WWT's "AIM" framework 

Our proven AIM framework, which stands for Assess, Implement and Maintain, guides our approach to cloud cost management:

• Assess: We use a recommendation engine to assess cloud environments and report on opportunities to reduce costs across our clients' businesses.
• Implement: Through workshops, we help clients understand the status of their cloud workloads before implementing custom risk/benefit priority work plans to drive savings.
• Maintain: We identify which assessments and procedures are needed to manage, maintain and scale their optimized cloud environment going forward.

Our services span AWS, Google Cloud and Microsoft Azure, providing clients with a comprehensive range of benefits, from visibility and governance through reporting, forecasting, real-time insights and savings opportunities to more flexible payment terms, services and consumption models. 

WWT's cloud cost management services and offerings explained

Managed billing: Enhanced billing with multicloud visibility and custom reporting

• Cost challenge: Public cloud clients often rely on native AWS, Google Cloud and Azure tools to gain insights into their billing data. When an organization uses two or more of these cloud providers, it can be difficult to get a unified view of their overall cloud spend.
• WWT service: WWT offers consolidated and managed billing across hyperscalers, providing a comprehensive view of a client's entire cloud footprint and enabling capitalization on cloud spending. We also deliver customized reporting and dashboards that allow specific business units to see charge-back and show-back.

Cloud commit consulting: Negotiation, forecasting and rate optimization

• Cost challenge: The potential for vendor lock-in is one of the main risks of poorly negotiating a cloud commit agreement. Vendor lock-in refers to the situation where an organization becomes heavily dependent on a specific cloud provider's services and technologies, making it difficult to switch to another provider or bring certain workloads back in-house.
• WWT service: We can help negotiate cloud commit agreements with cloud vendors. This allows us to ensure clients get the maximum value out of their cloud investment by understanding current and future cloud consumption needs. Additionally, our cost management team can provide guidance on potential rate optimization solutions.

Potential capitalization through customized contract terms

• Cost challenge: Many clients recognize cloud spend as either Capex or Opex, which can make it difficult to capitalize.
  • Capex: Traditionally, organizations have made large upfront investments in on-premises infrastructure (e.g., servers, networking equipment, data centers, etc.). These investments are considered capital expenditures (Capex) because they are long-term assets that depreciate over time. With the cloud, clients can shift away from upfront capital investments and instead pay for cloud services on a pay-as-you-go basis. This allows them to avoid large upfront costs and the need to manage and maintain physical infrastructure.
  • Opex: Cloud services are typically billed on a subscription or usage-based model, which falls under operating expenditures (Opex). Clients pay for the resources and services they consume on a recurring basis, similar to utility bills. This provides flexibility and scalability, allowing clients to adjust their usage and costs based on their needs. Opex spending enables organizations to align their expenses with their actual usage, avoiding overprovisioning or underutilization of resources.
• WWT service: We offer customized contract terms to our clients, providing potential flexibility and financial advantages. We can also help clients understand how other industry clients have achieved capitalization. Ultimately, the decision between Capex and Opex for cloud spend depends on an organization's financial goals, cash flow considerations and the specific nature of their workloads. Many organizations find a hybrid approach beneficial, where they leverage the Opex model for variable workloads and use Capex investments for more predictable or long-term requirements.

Cloud accelerators and assessments

We offer a variety of cloud accelerators and assessments to assist organizations in assessing their current cloud state and planning for future requirements. These solutions are designed to give organizations a comprehensive understanding of their cloud environment, identify potential risks and provide strategic recommendations. They are offered through WWT and individual cloud hyperscalers (note that naming conventions between hyperscalers may vary). 

Cloud Marketplace Assessment and Public Cloud Commitment Contract Assessment are our most popular assessments, designed to optimize software procurement processes and evaluate factors impacting the ability to meet or exceed contractual commitments.

Tier 1 diversity spend credit for cloud marketplace and cloud consumption

Expanding diversity spend is a focus for many clients. WWT is a nationally certified Minority-owned Business Enterprise (MBE). As a WWT client, solutions and services that are procured from and billed directly through WWT (including cloud consumption and cloud marketplace transactions) are eligible for Tier-1 Diverse Spend designation and/or minority spending credits.

Tier 1 diversity spend measures the value of goods and services that an organization procures directly from diverse suppliers. Diverse suppliers can include minority-owned, women-owned, disabled veteran-owned and LGBTQ±-owned companies. 

Cloud marketplace advisory services

• Cost challenge: AWS, Google Cloud and Azure marketplaces offer benefits like rapid deployment, streamlined purchasing and more. However, navigating the various cloud marketplaces can be challenging.
• WWT service: WWT's cost management team can help clients navigate and transact via their respective marketplaces to maximize discounts, right size commitment levels and determine the best purchasing approach for third-party software. We can also conduct bake-offs between OEMs/ISVs and SaaS products across different hyperscaler environments, providing unbiased guidance and advice to clients.

Training programs, available through cloud marketplace or direct

• Cost challenge: As clients work to certify or upskill their cloud resources, developing learning roadmaps and planning can be challenging.
• WWT service: We facilitate cloud training plans and provide discounted courses and exams to our clients. We also partner with AWS, Azure and Google Cloud to offer on-demand, virtual or in-person courses depending on the need.

WWT Cloud FinOps program

Our cloud FinOps program can help supercharge an organization's ability to optimize cloud spend. This involves building visibility into cloud costs and making continual adjustments within the cloud environment. Our program drives cost optimization and generates additional savings.

ATC lab, available to all WWT clients

The Advanced Technology Center (ATC) is a collaborative and innovative ecosystem consisting of labs, accessible physically and digitally, to clients, partners and employees around the globe. The ATC provides ongoing access to sandbox environments for clients to test product-specific entitlements against current solutions, understand functionality for end-users and engineers, and much more, empowering users to innovate, build, educate and deploy technology solutions. 

Conclusion

In today's competitive landscape, prioritizing cloud cost management not only prevents overspending but also maximizes the value derived from cloud infrastructure. As your partner, we will help you tackle the challenges that come with the complexities of managing cloud. In addition, you'll get access to industry-leading cloud consultants, architects and implementation experts.