Cloud Optimization: The 4 Things You Must Optimize

Cloud optimization is a critical aspect of CloudOps, aimed at enhancing the performance, cost-efficiency, and reliability of cloud resources and services. This process involves meticulously selecting, provisioning, and right-sizing computing resources, ensuring they are perfectly matched to each cloud application or workload. The primary objective is to minimize resource waste and optimize efficiency by continuously adjusting the balance between workload performance and cost, thereby identifying the most effective infrastructure setup for varying scenarios.

Key benefits of cloud optimization include reduced overspending, improved transparency in cloud expenditure, and enhanced utilization of cloud resources, leading to increased productivity. It allows applications to operate on minimal infrastructure, simplifying management, and offering better return on investment. This is achieved by leveraging application metrics to guide resource usage.

Cloud optimization recognizes that each application and workload has specific, evolving infrastructure needs. Traditional methods involve using domain expertise to estimate baseline performance for resource allocation. However, integrating machine learning can revolutionize this process, simplifying and enhancing the efficiency of cloud resource utilization.

Learn more in our detailed guide to cloud infrastructure.

Best practices in cloud optimization encompass:

Right-sizing computing services for scalable solutions
Utilizing spot instances to optimize costs
Investing in reserved instances for long-term savings
Identifying and eliminating unused resources
Consolidating idle resources for better efficiency

Related content: Read our guide to cloud scalability.

This is part of an extensive series of guides about Iaas.

In this article:

Why Is Cloud Optimization Important?
4 Things To Optimize in Your Cloud Environment
Cloud Optimization Services and Tools
Cloud Optimization Best Practices
Cloud Cost Optimization with Spot by NetApp

Why Is Cloud Optimization Important?

Cloud optimization is very important for businesses looking to scale while optimizing cloud costs. Cloud cost optimization is a key component of an effective cloud optimization strategy but is not the only focus.

Cloud optimization also encompasses measures to improve software quality, cross-team collaboration, application performance, and ongoing feedback across the organization. A strong cloud optimization strategy helps ensure an immediate and long-term return on your investment when moving to the cloud. It also helps increase developer productivity and supports the migration of business operations from on-premise environment to the cloud.

Cloud optimization is very important for businesses looking to scale while optimizing cloud costs and eliminating waste. It can help determine the most efficient way to allocate cloud resources among different use cases, reduce overspending, improve visibility into spending, and improve utilization of cloud resources. It can also help organizations better forecast and report spending to leadership teams.

These benefits mainly relate to cloud cost optimization, which is a key component of an effective cloud optimization strategy, but is not the only focus.

4 Things To Optimize in Your Cloud Environment

Here are some of the main aspects of cloud optimization.

Cost-Effectiveness

Cost reduction is the most important factor in cloud optimization for most companies. A major issue with cloud computing is that you can easily overspend by allocating more resources to your workloads than you would on-premises.

The complex nature of cloud pricing models further exacerbates this problem. Cloud service providers often have pricing menus charging different rates for the same services in different regions or times.

The cloud provider’s cost monitoring tools can help solve this problem (i.e., Cost Optimization Monitor for AWS and Cost Alerts for Azure). You can use these tools to understand your spending better and alert you when you overspend.

However, cloud providers do not intervene to prevent users from spending too much on their platforms. They do not provide tools to work across hybrid and multi-cloud environments. As a result, cloud cost optimization strategies usually include multiple tools and methods, such as third-party services for multi-cloud architectures, rather than native, vendor-specific offerings.

Learn more in our detailed guides about:

Performance

Optimizing performance in the cloud means ensuring your services and applications operate quickly and smoothly.

Cloud performance, like cost, is a complex subject depending on many factors. One important aspect to consider is the cloud architecture’s design. For instance, a cloud architecture that requires frequent data transmission between different regions or separate clouds can suffer from poor performance due to network latency and bottlenecks.

The type of cloud service you choose may also affect performance. Virtual Machine (VM) resource allocation may be more constrained for certain workloads—serverless features may perform better than standard VMs.

Even if the code is not explicitly cloud-specific, its underlying efficiency can significantly impact cloud performance. You should regularly test the performance of all application code before deployment.

Reliability

Failures of the hosting cloud can make a cloud-based workload unavailable. Sometimes, workloads become unreliable because of inherent problems. It is important to mitigate these risks to maximize the reliability of your cloud applications.

Providing redundancy is a solid strategy for ensuring reliability. It involves a company deploying multiple instances of a single workload across multiple regions within a cloud or in separate clouds. However, this type of protection is often expensive, so it is important to balance the redundancy strategy with cost optimization objectives for the best overall results.

Third-party solutions that ensure enterprise-level SLAs across multiple clouds can complement these strategies as well.

Related content: Read our guide to cloud automation

Security

Operating in the cloud can make it difficult to accurately identify security vulnerabilities and implement the appropriate security measures to mitigate them. You can handle this challenge by achieving centralized visibility and leveraging tools that provide actionable security insights.

A tool with dedicated security measures can address the most common, severe threats you expect your cloud systems to face. Ensure the technology provides both preventive and reactive measures, such as:

Pre-event awareness – involves assessing risks and implementing the appropriate safeguards before events occur. Notable pre-event safeguards include container visibility, VPNs, and virtual machine (VM) encryption.
Post-event awareness – apply measures that assist in identifying and responding to security events effectively and quickly. Common post-even techniques include DevSecOps practices, security risk mitigation tools, and compliance automation.

Cloud Optimization Services and Tools

The major public cloud vendors, including Microsoft Azure, Google Cloud, and Amazon Web Services (AWS), have an overwhelming price range with thousands of possible combinations of services and technologies based on different pricing models. Even highly experienced IT professionals and businesses find navigating the sheer volume of offerings difficult.

Fortunately, cloud optimization service providers help organizations achieve their cloud optimization requirements and business objectives. Companies can use a cloud optimization service to identify areas for improvement in the cloud and reduce costs, increase efficiency, establish organizational optimization strategies, and manage cloud infrastructure to enable continuous optimization.

Cloud optimization services provide access to certified cloud experts who work with customers as an extension of their internal IT team. They conduct independent audits of the cloud environment and highlight key areas where the company can optimize costs.

These services can benefit your company in the following important ways.

Reduce Costs and Invest Smarter

Many organizations waste money on redundant and over-provisioned infrastructure, consuming a large portion of their overall cloud spending. Optimizing costs across a large organization can result in significant savings and money to put into better investments. By optimizing cloud infrastructure, companies can cut up to half of their overall cloud spend, creating opportunities to invest in more strategic needs such as innovation and growth.

Increase Visibility

Transparency and visibility are essential for cost management. Cloud optimization services provide accurate and meaningful reports on how each business unit uses resources, how much they spend, and where they can improve efficiency. Increased visibility allows organizations to tailor their cloud spending to their business needs.

In addition to controlling costs, cloud optimization services increase visibility across cloud environments. They allow business teams to strategize and scale their cloud services confidently.

To maintain optimal performance, cloud management partners should right-size the cloud environment. They check your usage and create a workload heatmap to find idle resources and identify when you can spin down resources. This approach helps you migrate any resource that can run on a smaller instance without impacting performance. It reduces waste and keeps the cloud running at optimal capacity.

Access Skills and Expertise

With more enterprises migrating to the cloud, the demand for technical expertise is also increasing. However, many companies lack in-house expertise, creating a cloud skills gap. Given the steep rise in demand and the competition over limited personnel, the skills gap has nearly doubled in recent years for most companies.

A cloud optimization service can help fill the skills gap by providing access to a team of experienced, certified cloud experts to complement the internal IT team, while also providing tools that are purpose-built for cloud optimization.

Cloud Optimization Best Practices

Right-Sizing Computing Services

Right-sizing is one of the best practices in cloud optimization that allows businesses to match their cloud services with the workload requirements effectively. This approach involves choosing the right type of instances or services and the appropriate size to fit the actual workload demand.

Right-sizing requires you to analyze workload patterns and utilization metrics continuously. By leveraging machine learning algorithms, businesses can effectively forecast their future needs based on historical data. This allows them to avoid overprovisioning and underprovisioning resources, resulting in better cost efficiency and improved performance.

Making Use of Spot Instances

Spot instances are a cost-effective way to utilize cloud resources, particularly for workloads that are not time-sensitive. Cloud providers such as AWS offer Spot instances, which are spare compute capacity available at a significantly lower cost than on-demand pricing.

However, spot instances can be interrupted by the cloud provider with little notice when the demand for these resources increases. Therefore, they are most effective for tasks that can be stopped and restarted without any critical impact, like batch jobs, data analysis, or development and test environments. With advanced automation, spot instances can be used even for critical workloads that cannot tolerate interruptions.

Learn more in our guides to AWS spot instances and Azure spot instances

Investing in Reserved Instances

Reserved instances are another effective cloud optimization practice that can significantly reduce costs. These are commitments to use specific services for a longer period, usually one or three years, and in return, the provider offers substantial discounts compared to on-demand pricing.

Reserved instances are best suited for predictable and steady workloads. While this approach involves a long-term commitment, it can provide cost savings of up to 75% compared to on-demand instances.

Learn more in our detailed guide to cloud reserved instances, AWS reserved instances, and Azure reserved instances

Identifying Unused Resources and Removing Them

As part of cloud optimization, it’s crucial to regularly review and remove unused or underused resources. These can include idle instances, unattached storage volumes, or outdated snapshots. These resources, although idle, still contribute to costs.

The use of monitoring and management tools can provide a comprehensive view of the cloud environment and enable the identification of such resources. Regular audits and clean-ups not only reduce costs but also improve the management and security of the cloud environment.

Merging Idle Resources

Merging idle resources is another effective cloud optimization strategy. During off-peak hours, several instances might be under-utilized. By merging these workloads, you can ensure better utilization of your resources while reducing the overall cost.

Auto-scaling and load balancing are two key technologies for this purpose. Auto-scaling adjusts the number of active instances based on the demand, and load balancing distributes network traffic across multiple servers to ensure no single server bears too much demand.

Cloud Cost Optimization with Spot by NetApp

While public cloud providers offer native tools for some cloud optimization, and even provide recommendations for potential cost reduction, they stop short of actually implementing any of those optimizations for you.

This is where Spot by NetApp’s portfolio can help. Spot not only provides comprehensive visibility into what is being spent on your cloud compute and by whom, but also:

Generates an average saving of 68% by showing you exactly where you can use either EC2 spot instances or reserved capacity (RIs and Savings Plans) to save costs. It lets you reliably automate workload optimization recommendations in just a few clicks.
Guarantee continuity for spot instances, ensuring even production and mission-critical applications can safely run on spot instances, using predictive algorithms and advanced automation to guarantee workload continuity.
Manage RIs and Saving Plans portfolios, providing maximum utilization and ROI with minimal risk of financial lock-in and cloud waste.
Maximize savings for DevOps teams running Kubernetes with proven machine learning and automation to continuously determine and deploy the most balanced and cost-effective compute resources for your container clusters.

Learn more about Cloud Optimization from Spot by NetApp

See Additional Guides on Key IaaS Topics

Together with our content partners, we have authored in-depth guides on several other topics that can also be useful as you explore the world of IaaS.