Increase operational efficiency. Improve your bottom line. Help save the environment.

Industry watchers confirm that cloud computing has not only gone mainstream, but also that nearly all organizations have joined the trend. For example, according to DevOps.com, more than 90% of all organizations used public cloud services in 2020, and spent more than $50 billion in the process. This spending is expected to go in only one direction: up.

One of the biggest reasons why companies are making this move is to save money. They intend to lower their operational costs by shifting part or all of their IT infrastructure and applications to the cloud. The strategy must make good business and have a clear and compelling ROI because so many CFOs and other top executives have signed off on it.

Wasting Money to Save Money?

There is an odd variable in the cloud spend equation, one that’s jarringly out of sync with the overall goal of lowering costs. It’s called ‘cloud waste’, a term that refers to the wasteful spending that occurs under most (if not all) cloud service arrangements. Generally, this waste stems from over-provisioned infrastructure that ends up being unused or under-used.

It’s no small problem. Industry analysts estimate that roughly 30% of cloud spend is wasted. In 2020, that added up to $17.6 billion according to the experts at DevOps.com. Other market watchers such as Accenture put the rate of waste closer to 40%.

Environmental Impact

One aspect of cloud computing that is getting more public attention lately is the negative effects it is having on the environment. Although most people don’t realize it, the cloud industry is one of climate change’s biggest challenges and most overlooked contributors. In a matter of years, data centers became one of the largest annual energy consumers and emitters of carbon pollution. Data centers currently represent roughly 3% of the world’s total energy consumption and they emit nearly 100 million metric tons of CO2 into the atmosphere each year.

It’s Time to Curb Cloud Waste

Cutting wasteful cloud spend is obviously a good idea. So is doing the right thing by the environment. But organizations of all kinds now rely heavily on their cloud infrastructures, so making changes can be complicated and risky.

It doesn’t have to be that way, however. This paper outlines a 10-Step process that organizations can use to lower their cloud waste while maintaining their operational efficiency and agility, and decreasing their carbon footprint.

The following is a 10-step process that StormForge is now using to pursue these goals. It’s a straightforward approach that should be applicable for many organizations. If we all strive to reduce our cloud waste, we’ll see better-operating results and hugely positive environmental impacts.

Step 1

Define the Problem

Before attempting to address any operational issue, leaders and their teams need to understand exactly what the issue is. To do that, they need to define it, including its general nature, its negative impacts, its component elements, and their likely sources.

In the defining process, teams should focus on the wasteful spending aspect, but also be sure to include the resulting problems excessive cloud use is causing to the environment. The following, simple definition is a good place to start. 

Cloud Waste:

Cloud waste refers to purchases of cloud resources that go unused or under-utilized. The resulting, wasteful spending increases operating costs without adding value, and precludes using those same funds in other areas of the business. Furthermore, cloud waste, whether generated in private or public cloud environments, needlessly contributes to the negative impacts that data centers have on the environment (higher power consumption, more CO2 released into the atmosphere, etc.).

Step 2

Educate, Communicate and Equip

Before moving ahead with any specific actions, it’s helpful to first raise the issue with staff at appropriate team meetings, in corporate communications, and in other venues. Defining the problem naturally leads to identifying likely causes and contributing factors. That involves pointing out where it typically happens in an organization’s processes and workflows, and by which departments, groups, and roles. 

Rather than framing this as a negative that needs to be rooted out and eliminated, frame it as a positive initiative, one aimed at curbing costs without impacting operational effectiveness.  The idea here is to educate staff about a building problem with both financial and environmental ramifications, and to enlist their support in addressing it. A big part of this is equipping developers with tools that provide them with greater visibility into what it takes to run their applications at the levels required. Developers also  need better controls so they can make resourcing adjustments quickly without having to wait for days or deal with potential downtime while changes are being made. With better tools and systems that create better visibility,  developers can make smarter resourcing decisions.

Step 3

Build a Cloud Efficiency Culture

When developers, DevOps people and others are on the hook to make sure a critical application always works as needed, the nearly infinite resources available in the cloud are awfully tempting. Start building a culture on the basic fact that using ever more cloud resources isn’t the answer. In fact, it’s lazy, and financially and environmentally irresponsible.  

When your team is turning on a cloud resource, encourage them to use only the resources needed to get the job done – and not double or triple that amount. Discourage activities like instance hoarding. Don’t have the default be on-demand services. Make sure that your team or your cloud provider shuts things off when not in use.

Another important step for companies to take is to make sure that it’s okay for developers to step back from their day-to-day duties every so often and set aside time to research and experiment with new and better ways of doing things. These things usually take time and thoughtful consideration — such as investigating the feasibility of moving from AMD64 to ARM chips for power efficiency. Write this quality time prerogative into things like job descriptions and performance review processes. And when good ideas surface, don’t be afraid to make the change. 

In short, set efficient cloud resourcing as the goal. Don’t have it be a top-down mandate, but instead, cultivate and encourage the cultural things that will contribute to this becoming a bottom-up, grassroots push in your organization. Challenge your team and make this new approach a point of pride with them.

Step 4

Conduct an Assessment

Next, determine the present state of your organization’s cloud waste problem, determining where it’s happening and to what degree. To do that, examine all IT operations and identify any systems, processes, or workflows that rely in any way on cloud-based elements.

Once there’s a comprehensive list of cloud-dependent systems and processes, determine the contractual arrangements covering those resources. Establish a priority order, determining which cloud-consuming systems and processes are most critical to the business, and which ones are more tangential.

Another helpful step here is to get a sense of the cloud spend being wasted by peer companies or across your industry segment. If this cannot be obtained through market data or analyst reports, anecdotal information from industry contacts can at least set some parameters.

Next comes the critical step of gauging how much cloud-based resources an application, system or process is currently provisioned with versus how much it actually requires. A subsequent step is determining which systems and processes are using (being billed for) using the less expensive “reserved instances” versus the more expensive on-demand variety. And last, but far from least important, is comparing the anticipated need versus real usage.

While there will be room for debate in these resourcing discussions, the first step is to identify obvious outliers – apps, systems and processes being supported by way more cloud resources than they will ever reasonably need. It’s critical to have this list in hand before moving to the next steps.

Step 5

Set Realistic Goals and Communicate Them

Cloud migrations are complex. They require a fair amount of planning and time. Ramping up cloud usage, and straying into cloud waste situations also took some time. So, it will also take time to pare back cloud waste. Plus, there are risks – operational and reputational – that companies face when altering their cloud service arrangements. Handling those risk exposures thoughtfully and carefully is a must.

It pays for organizations to be just as careful when taking reduction actions as they were during their initial cloud migrations. It’s smart to set modest goals, such as an initial 10% reduction. It’s also a good idea to pick a reasonable timeframe – six months, for example.

Then, as is the case with any corporate IT initiative, the overall project, along with its goals and timeframe, needs to be communicated to all who will be directly and indirectly involved. Regularly communicating updates is also a best practice.

Step 6

Initiate Actions and Get Specific

With the necessary assessments and planning completed, it’s time to make cuts to cloud services. Systems and processes that are clearly over-provisioned (either unused or under-used) should be the first targets for reductions.

Next, make sure that static workloads are provisioned appropriately. Likewise, with dynamic workloads, develop accurate predictions of their fluctuations in demand for resources, and provision accordingly.

Next, target messy items that exist in every organization, the things that aren’t quite right. This includes items your team thought they needed but actually didn’t, and artifacts left over from previous IT efforts. Also in this category are things that were once important but aren’t any longer, but are still running or being paid for. Top offenders here include suboptimal container settings, old images, orphaned volumes, and widowed instances. All of these items should be cleaned up pronto.

If the cloud waste is happening in the private cloud run by your organization, the change can be precise and done without any outside involvement. If it’s a change to a public cloud arrangement, then contractual items, such as provisioning types and mounts, and service level agreements, need to be changed or updated with the cloud services provider.  

Once this house cleaning has been completed, useless and vestigial items will be gone. You’ll also have an accurate estimate of your actual capacity requirements (types and amounts). Then, whether it’s in your own private cloud operation or with your cloud services provider, you take action to close the gap between present provisioning and what’s actually required.

Step 7

Stay Focused and Be Responsive and Efficient

Organizations change, so their cloud computing requirements do, too. Stay focused on these changes, and not just new needs, but old arrangements that are no longer needed. Make sure your team is just as responsive in ushering in the new, as they are with getting rid of the old and outdated.

Ensure that your service provider, and/or the tools your team uses, ensures that your organization is able to spin up services smoothly and cost-effectively when needed. And make sure the inverse is true; make sure that you can spin resources down rapidly and efficiently after the need for them subsides. Leverage container orchestration tools and technologies such as auto-scaling to ensure that the required resources get automatically allocated and released as dictated by workload needs.

Step 8

Track and Measure Progress

As with any other organizational initiative, efforts to reduce cloud waste will only work if teams set measurable goals, track them closely, and try to make progress towards them every day. This may be simple business sense, but teams should make specific goals, ones that are narrow enough for team members to focus on. The goals need to be measurable, and include clear definitions of what will be tracked, and what progress will look like. The goals should also be realistic. In other words, they should be attainable within a given time period. With cloud waste reduction, teams could set specific percentage targets for the year broken out by quarters. Lastly, it is helpful to align a specific program like cloud waste reduction with a broader corporate initiative or initiatives (such as a Green or Operational Excellence programs).

Step 9

Don’t Lose Sight of the Environment

As mentioned above, the datacenters from which cloud services emanate are enormous consumers of energy and, as a result, release lots of CO2 into the atmosphere, contributing to climate change.

The large carbon footprints of data centers used to be a little-known fact. But that is changing. Market researchers and industry analysts are increasing awareness of this problem. Various mitigation actions are starting to be taken by leading cloud service providers, as well as by a growing roster of companies.

Get active with these efforts and lend your organization’s and your team’s voices to these efforts.

Step 10

Recognize and Reward Success

This is perhaps part of the culture-building in Step 3 above, but it is worth calling our separately. The impact that cloud service efficiency can have on an organization’s operations and its bottom-line results can be significant. The environmental impact, while perhaps less tangible in the near-term, is nonetheless important to the industry as a whole. 

Team members who focus on cloud service efficiency goals and take the actions needed to achieve them, should be recognized and rewarded. Not doing so is a lost opportunity for organizations to advance their efforts to not only do well, but to also do good.

Conclusion

From corporations to nonprofits to government agencies, our collective appetite for cloud-based computing resources isn’t likely to diminish anytime soon. 

As market data makes clear, the cloud waste problem – the wasteful spending – is also predicted to continue its rapid rise, and with it, the financial and environmental issues outlined herein.

We can change this trajectory. We can reduce the amount of money we’re wasting, and the amount of pollution data centers large and small are pumping into our environment. All it takes is a shift in focus, and all of us embracing a new way consume cloud resources.

The steps outlined here may not be perfect, but they’ll provide you with a great start on a journey we’re all going to have to take together. We’re ready to get going. Are you?

StormForge Can Help

StormForge offers a set of advanced, machine learning-powered software products that can help organizations to significantly reduce their cloud waste. Leveraging the StormForge Platform’s  enterprise-grade performance testing and automated application performance optimization capabilities, the company’s products deliver significant improvements in resource optimization and efficiency — two core drivers of cloud waste reduction.

If you’re ready to learn more about how StormForge can help your organization to drive major resource efficiency and performance gains, as well as major cost savings and environmental gains through cloud waste reductions, contact us today, or visit us on the web at www.stormforge.io.

Cloud Waste FAQs

Cloud waste refers to purchases of cloud resources that go unused or under-utilized. The resulting, wasteful spending increases operating costs without adding value and precludes using those same funds in other areas of the business.

As for the wasteful spending and resources that the term ‘cloud waste’ refers to, clouds themselves do not produce this waste. Rather, the digital waste is created when people buy more cloud resources than they actually need, and then either don’t use them or under-use them.

Clouds do, however, create another type of waste. That’s the byproducts of all the energy consumed (including electrical, ventilation, heating, cooling, etc.) in the process of running the data centers required to provision cloud services. In particular, it’s the large amounts of CO2 that data centers release into the atmosphere, contributing to climate change.

From the financial perspective, any operational expense that is unnecessary, or that is in excess of what’s needed is a luxury that companies cannot afford in today’s highly competitive market. Those funds should either be redirected in ways that create more business value, or be saved to improve bottom-line results.

From the environmental perspective, wasteful uses of energy contribute unnecessarily to the pollution that we all need to reduce in order to reverse the devastating course of climate change.

The real answer to this question is complex, involving why people essentially pad their projects with extra resources in order to ensure success rather than taking the risk of ‘right sizing’. Reducing cloud waste involves making many changes, but perhaps the biggest is creating a new mindset around cloud resource setting and tuning. Going for cloud efficiency instead of doubling or tripling what’s necessary needs to be the new mantra.

Although it remains a little-known fact, data centers are major emitters of CO2 into the atmosphere. Those emissions contribute to climate change. And datacenter inefficiencies (running more resources than needed, and running resources that go unused, etc.) needlessly make matters worse.

There are several actions that organizations can take in order to identify and reduce their cloud waste. These steps include making accurate cloud resource needs assessments, and comparing them to items such as actual cloud resource usage and contracted service availability. Encouraging and promotion right-sized cloud resourcing, and discouraging padding is a major help.