Apr 03, 2019

3 Budget-Friendly Tips for Cloud Cost Optimization

Cloud software solutions provide businesses with untold freedoms and flexibilities. With just an internet connection, an organization now has access to hundreds of essential software apps that previously demanded local server space, on-site IT personnel, maintenance and support contracts, and a host of other resources to keep them up-and-running.

Cloud computing and SaaS solutions significantly reduced or even eliminated those demands for many organizations, freeing up their resources for other essential business functions.

But the cloud costs money, and if you’re not careful, cloud software solutions can sink your organization’s budget if you haven’t implemented the appropriate cloud cost optimization tools.

Piggy bank floating in the clouds, representing cloud cost optimization

How did this happen? How did an innovative resource-saving technology become such a potential financial risk?

The SaaS sales approach: a ticking time-bomb

The SaaS spend explosion is directly tied to accurate software license management, or the lack thereof as the case may be here. The cloud doesn’t just give your organization new flexibilities; SaaS solutions also provide software vendors new sales opportunities and locked-in future revenues.

Software vendors no longer need to hack their way through corporate and organizational bureaucracy to sell and deploy a solution. Instead, they can go right to the individual business units. This is great both for the vendor and the customer; the vendor has a source for new steady revenue streams, and the customer has direct and easy access to the vendor, a win for everyone.

Case Study

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The organization on the other hand loses oversight. Without the right cloud optimization software and processes in place, an organization can quickly find itself with uncontrolled SaaS costs. Without central contract negotiations and a common solution design and architecture, organizations can lose money through expensive local support service agreements and sub-optimal, expensive SaaS contracts. They will also deal with the added frustration and costs of heterogeneous systems.

Cut the red wire with strategic cloud cost management

With the right cloud cost optimization tools and processes, cloud Software Asset Management can be easy and save significant resources and costs. Here's what we recommend.

  1. Know your environment. Find all the SaaS software deployed in your environment. Use a combination of traditional on-premises discovery tools (especially useful for hybrid solutions), cloud discovery tools, and old-fashioned paper trails. Credit card receipts, invoices, and expense reports can reveal previously unknown SaaS solutions purchased by individual employees and business units.
  2. Get the data. Once you know which SaaS solutions are deployed in your environment, get a robust picture of your usage and deployment data and contract information to find the right subscriptions for your needs.
  3. Engage your stakeholders. Your front-line in containing SaaS software costs is well-informed and enabled stakeholders. Make them an essential part of your cloud Software Asset Management strategy by giving them the tools they need to provide accurate, up-to-date reporting, and to make timely licensing decisions.

Grow up, don’t blow up

A software license management solution for cloud can defuse potential budget bombs. Detect problem spots before they ignite, keep your SaaS environment safe and intact, and guarantee that your SaaS solutions help you grow to meet your business needs.

How to Build an Effective Cloud Management Practice: Strategies, People, Processes, and Tools

Learn how to minimize Cloud Shock – the unexpected, unbudgeted cost increase from delivering IT services via public cloud. Read the latest research from The ITAM Review.

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Topics: Cloud, SaaS