Summary

ElysianIT has helped many organisations ranging from SMB’s to Enterprise, to deploy Microsoft and Third-Party IT Solutions.

Managing costs in the cloud can be a challenging task, especially with the myriad of services and options available. Azure, being one of the leading cloud platforms, offers various strategies to optimise monthly costs effectively. Understanding these strategies and avoiding common pitfalls can significantly enhance your cost-efficiency.

1. Rightsize Your Virtual Machines (VMs)

• • Tip: Regularly evaluate your VMs and ensure they match the actual workload. Scale down any over-provisioned resources.
  • Common Mistake: Many customers allocate larger VMs than required, leading to wasted resources and increased costs.

2. Use Reserved Instances (RI)

• Tip: For predictable workloads, commit to 1- or 3-year Reserved Instances, which can save up to 72% compared to pay-as-you-go pricing.
• Common Mistake: Sticking with on-demand pricing even for steady workloads instead of using reserved pricing options.

3. Leverage Auto-scaling

• Tip: Set up auto-scaling policies that adjust resources dynamically based on demand, ensuring you’re only paying for what you need at a given time.
• Common Mistake: Over-provisioning for peak loads without using auto-scaling leads to under-utilized resources during off-peak times.

4. Implement Azure Hybrid Benefit

• Tip: If you have existing on-premises Windows Server or SQL Server licenses with Software Assurance, you can use Azure Hybrid Benefit to save up to 85% on Azure costs.
• Common Mistake: Paying for new licenses instead of utilising existing ones through this benefit.

5. Utilise Spot VMs

• Tip: Use Azure Spot VMs for workloads that are interruptible, such as batch processing jobs, and benefit from significant cost savings.
• Common Mistake: Running non-critical tasks on standard VMs rather than spot instances, which are much cheaper.

6. Optimise Storage Costs

• Tip: Move infrequently accessed data to lower-cost storage tiers like Azure Blob Storage’s Cool or Archive tiers.
• Common Mistake: Storing all data in the same high-performance storage, regardless of its access patterns, resulting in unnecessary expenses.

7. Clean Up Idle Resources

• Tip: Regularly review and decommission unused or idle resources, such as stopped VMs, unattached disks, and orphaned IP addresses.
• Common Mistake: Forgetting about old, unused resources that continue to accrue costs even when not actively in use.

8. Use Azure Cost Management + Billing

• Tip: Set up budgets, cost alerts, and reporting to monitor usage and spending patterns. Leverage recommendations provided by Azure Cost Management.
• Common Mistake: Ignoring Azure’s built-in cost management tools, leading to a lack of visibility into where money is being wasted.

9. Review Network Costs

• Tip: Minimise data egress and inter-region traffic to reduce network costs. Where possible, use the same region for your resources to avoid unnecessary data transfer fees.
• Common Mistake: Overlooking the cost of cross-region traffic or inefficient data flow between regions, increasing networking expenses.

10. Use Containers and Serverless Where Possible

• Tip: Move suitable workloads to containers (e.g., Azure Kubernetes Service) or serverless services (e.g., Azure Functions) to achieve better resource efficiency.
• Common Mistake: Running all workloads on VMs, which might be more expensive than using containers or serverless for certain types of applications.

11. Review Licensing and SaaS Subscriptions

• Tip: Ensure that any SaaS services or licenses you have in place align with current needs, and downgrade or terminate unused services.
• Common Mistake: Leaving unused or over-provisioned software licenses and SaaS subscriptions active without reviewing usage.

12. Implement Tagging for Resource Management

• Tip: Apply tags to your resources to improve tracking and attribution of costs to specific departments or projects, helping identify potential areas for optimisation.
• Common Mistake: Lack of tagging makes it difficult to pinpoint high-spending areas or to perform effective cost allocation.

13. Use Dev/Test Pricing

• Tip: Take advantage of Dev/Test or Visual Studio Subscription pricing for non-production environments, which offers significant savings on Windows and other licenses.
• Common Mistake: Paying full production prices for test environments when lower-cost alternatives are available.

14. Manage SQL Databases Efficiently

• Tip: For SQL workloads, review performance tiers and consider elastic pools if you’re running multiple databases to reduce costs.
• Common Mistake: Over-provisioning database resources, leading to unnecessary cost for under-utilised SQL servers.

15. Regularly Audit and Optimise Workloads

• Tip: Perform regular performance and cost audits using Azure Advisor, which provides recommendations on high-availability, security, and cost improvements.
• Common Mistake: Not auditing regularly, allowing inefficient resources to go unchecked, leading to accumulating costs over time.

Conclusion

By following these tips and regularly reviewing Azure’s cost management features, customers can significantly reduce unnecessary expenses. The key is to match resources with actual needs, leverage available discounts, and monitor consumption regularly to avoid overspending.