Implementation priorities
The M&G Guide recommends that you implement your Cloud Financial Management capabilities with transparency in mind. This includes enabling your builder teams to see the financial impact of their cloud usage for the resources they provision, as well as to define specific controls related to the financial governance of your resources.
Enable Cloud Financial Management
Configure detailed information sources including
Billing
and Cost Management tools to create the reporting your
organization needs. Regularly review (minimally on a monthly
basis) the cost and usage by different dimensions to understand
cost drivers. Establish organizational metrics, such as a
unit
metric
Tag, track, and monitor resource costs across their lifecycle
A consistent and well-designed tagging strategy is required to manage and track costs across your AWS environments. Once resources in your environments are tagged, you must activate both AWS-generated tags and user-defined tags separately to use them in your cost reporting and analysis tools. Enforce tag options using distribution and preconfigured infrastructure as code templates for governance. Use tag policies to enforce and maintain consistent tags across your organization and resources.
Track resources over their lifetime and design your workloads to
gracefully handle resource termination as you automatically
identify and decommission non-critical or low utilization
resources. Analyze the design, architecture, and all components of
each workload or application for cost effectiveness, including
license costs. Use
Managed
entitlements
Establish mechanisms for cost governance
Create policies and mechanisms that define how resources are managed by your
organization. The policies should cover cost aspects of resources and workloads, including
creation, modification, and decommissioning over the resource lifetime. Create an
obsolescence plan and defined retention period with lifecycle policies for resources as they
are provisioned. Implement account structure, groups, and roles to help allocate costs and
control who can create, modify, or decommission instances and resources in each group.
Identify any new controls that could support a more efficient cost spend. Update your
distribution of infrastructure as code templates in Service Catalog
Continually optimize for cost efficiency
Review historic spend patterns to detect cost spikes (one-time or recurring) or continual cost increases, assuming 14–30 days of historical spend. Implement mechanisms to periodically identify and right-size instances based on current workload metrics and characteristics. This can be evaluated using AWS Cost Explorer, AWS Trusted Advisor, and AWS Compute Optimizer, along with AWS Partner tools, such as VMware CloudHealth, Apptio Cloudability, and CloudCheckr. Cost efficiencies can also be achieved with Compute Savings Plans, Reserved Instances, Spot Instances for ephemeral workloads, and Amazon CloudFront Security Savings Bundle. Continually reviewing cost metrics can help to identify over purchased or underutilized savings mechanisms. For example, you can optimize your storage costs with S3 Intelligent-Tiering, Amazon S3 Glacier, or implementing lifecycle policies and purge processes. Centralize redundant or shared infrastructure to optimize costs. Manage demand and supply resources dynamically by implementing scheduled or automatic scaling, buffering, or throttling. Review new EC2 instance types as they are released to take advantage of a better price-performance ratio.