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How Hybrid Cloud Costs Can Spiral Out of Control

If you listened to the analysts 10 years ago, we should by now be consuming all of our IT from the cloud, much like we consume electricity from the grid, with little knowledge or care as to how it is generated or distributed. Things haven’t quite moved at that pace and we are stuck, possibly for many decades to come, at the mid-way point: hybrid cloud. Hybrid cloud, or a computing environment that mixes on-premises infrastructure, with public cloud and SaaS applications, has become the norm that’s replaced or augmented the data centre or the server room. If you’re like most organisations, you’ll find this was probably never the intentional design, but has instead grown organically to address new computing needs as they arose from the business.

Before long, three things may have started to happen to your computing environment:

  1. IT lost control over the proper planning of IT, with the growth of “parallel IT” and multiple overlapping environments and applications. Business units consumed cloud infrastructure like it’s free, without regard for the final costs
  2. IT costs started to spiral out of control as the bills with thousands of lines of billing codes arrived from the cloud providers. The ability to analyse and extract actionable insights was low – so the bills continued rolling in.
  3. The business lost cost transparency of IT costs and couldn’t track its alignment to business services and consumers’ needs.

Hybrid IT certainly introduces complexity, so how can IT prevent this scenario from happening in the first place? And if that’s already your life – how can IT reassert its control over the infrastructure and the expenditure to rein in spending or provide visibility of expenditure to business value? After all, every dollar saved from keeping the IT infrastructure simply running, can be redeployed to funding new projects and delivering digital innovation to the business – making IT the business hero it deserves to be.

How Diaxion and Apptio can help

Diaxion and Apptio have teamed together to help IT departments gain full visibility of the costs and control of their IT infrastructure. It starts with the most insightful step: being able to fully understand your current IT costs. Those costs can include both CapEx (servers, hardware, depreciation) and OpEx (cloud, SaaS applications), as well as labour. Depending on the organisation, this can be used for chargeback, show back or cost governance purposes.

  • Where things can be really useful, however, is being able to use this newly gained IT cost transparency to:
  • • Baseline for comparing costs of on-premises infrastructure when all costs are factored in, including support, hardware and software, with moving the same business function on to the Cloud
  • • Deliver cost optimisation insights on IT expenditure by identifying idle cloud instances and never-used application licences
  • • Enable future planning for new digital initiatives and growth by being able to identify true IT costs for your organisation
  • • Establish ongoing cost governance for public cloud
  • • Enable business value realisation data for projects
  • Apptio is a purpose-built, vertically integrated data management tool, built from the ground up to manage IT spend. Coupled with the strategic, flexible and confident approach of Diaxion, together we are able to provide ongoing value to any IT team.

    If you recognise some of the issues your IT department is having in this post, we at Diaxion would like to meet with you for a demonstration and discovery overview on how you can re-gain control of your costs.

    Apptio software: www.apptio.com

  • • Download Gartner report How to Manage the IT Budget through Cost and Value Optimization
  • • Download Forrester report 10 Facts Every I&O Pro Should Know About Cloud Economics