How do you avoid cloud bill shock?

November 20, 2023 - 2 minutes reading time
Article by Corstiaan De Haaij

Organizations that move to the cloud enjoy several benefits. For example, working more flexibly and efficiently and having access to the latest technologies. However, these organizations must take measures to avoid getting a cloud bill shock. In this article you will read what cloud bill shock means, when it occurs and - most importantly - how to prevent it.

Cloud bill shock, of course, refers to the unexpectedly high costs that companies may encounter when using the cloud. This is similar to the shock of a sky-high toll bill after a seemingly carefree car ride. Like road pricing on toll roads, pay by consumption is also the standard billing method in the cloud. Large public cloud providers measure consumption in detail and attach charges to it. Thus, at the end of the month, organizations may be faced with significant bills for their cloud usage. The growing reliance on the cloud therefore makes it imperative for companies to proactively engage in cost control.

What causes cloud bill shock?

  • Lack of visibility into cloud invoices: many organizations receive their cloud invoices via credit cards. A detailed cost analysis is often missing, making it difficult to gain good insight into your costs.
  • Scaling servers too broadly: servers are often deployed at maximum capacity, without accurate estimates of actual usage.
  • Unexpected use of functionalities: if more functionalities are used than anticipated, this leads to unexpected costs.
  • Dev&Test waste: large development and test environments that stay turned on unnecessarily cause wasted resources.
  • Suboptimal design and implementation: suboptimal design or implementation of solutions results in inefficient use of cloud resources.
  • Lack of commitment: uncertainty or indecision leads to unnecessary flexibility in the cloud environment, resulting in additional costs.

Importance of management

Fortunately, cloud bill shock is preventable. This requires technology optimizations and an integrated approach to people, process, and technology. Invest in employee training to create awareness of the cost implications of their actions, implement solid resource management processes, and establish clear guidelines for cloud use. Frameworks, such as the Cloud Adoption Framework (CAF) and Well Architected Framework (WAF), provide the right tools to optimally design and deploy cloud and workloads. Management here is the key to realizing the promises of the cloud, without financial surprises at the end of the month. Prevention is the best cure, this also applies to high cloud costs.

Tools for cost control

  1. Set up the cloud platform according to standards: follow the standards and best practices of the cloud environment when setting up the platform, this ensures a solid foundation.
  2. Ensure connected management: implement a structured management process to gain insight into costs, this enables optimizations.
  3. Forecast and set budgets: anticipate expected usage and set budgets, monitoring these budgets simplifies cost monitoring.

Additionally, be wary of shadow IT and facilitate users optimally, while maintaining a grip on your cloud environment with the necessary guard-rails and assurance of governance. Also, being mindful of cloud resources is crucial to realizing the promised benefits of the cloud, without surprises at the end of the month.

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