AWS FinOps – Saving Money or Making Money?

How to regain financial and operational control and ensure a fully optimized AWS cloud environment (including insights on AWS gp3)

We’re working in an era where business moves at lightening speeds. Technology has drastically increased our ability to innovate, our speed to market, and the ease with which we can scale up or down in response to ever-changing needs. But with this enhanced agility and on-demand performance comes big tradeoffs in the form of financial accountability and corporate governance. Gone are the days when a staff member would fill out a purchase order, submit it to accounting for approval, and wait days (or even weeks) for the greenlight to make the purchase. Our on-demand expectations have phased out the spending analysis step from the procurement model.

In few places is this truer than cloud environments. All too often, inefficiencies are not uncovered until after the damage has been done and we’ve wasted significant portions of our -cloud budget on needless overspending. And let’s be clear:  wasting money means you’re not making money. This is why there is so much buzz surrounding FinOps these days. Short for financial optimization, FinOps is the practice of bringing financial accountability to the variable spend model of cloud, enabling distributed teams to make business trade-offs between speed, cost and quality. There are a variety of ways to optimize cloud spending, such as contracting and other savings programs, reserved instances and infrastructure add-ons that can boost efficiencies.

Optimizing AWS Cloud Performance

AWS is one cloud provider that consistently launches new technologies to increase the cost effectiveness of its cloud environments. The R&D teams at AWS are always looking for new ways to make their tools more functional and less costly. One of the most recent products is gp3, a new type of solid-state drive (SSD) Amazon Elastic Block Store (EBS) volume that lets you provision performance independent of storage capacity and offers a 20% lower price than existing gp2 volume types. The new gp3 volume type is designed for use with Amazon EC2 instances, an elastic compute cloud where virtual servers are procured as either dedicated servers or as part of a physical server. With gp3 volumes, customers can scale IOPS (input/output operations per second) and throughput without having to provision additional block storage capacity. This means customers only pay for the storage they need.

We find that most users are spending two-thirds of their budget on their EC2 product, and within that, about 40% of the spend is EBS related. The first step in optimizing this spend is to gain visibility across your entire environment and identify areas of high or rapid growth, then use best practices to optimize and contain your costs. Some ways to do this are by deleting or converting unattached disk storage, deleting old snapshots and terminating unused assets. Once you have done this initial analysis and clean-up, you can start taking advantage of savings programs. Based on your historical cost and usage data, AWS can recommend savings plan types, terms and payment options.

While it’s true that AWS and other cloud providers offer many ways for customers to save, it’s not always easy and can be quite time consuming to achieve results. Organizations often find that they don’t have the manpower to stay on top of cloud-cost management.

To help reduce the complexity of financial optimization, Lightstream offers a proprietary tool called Lightstream Connect that provides a holistic view of your technology spend and network through a single pane of glass. Lightstream Connect is not a new offering, however it was recently enhanced in early 2021 in response to AWS’s gp3 release. The first to market this type of functionality, Lightstream’s automated tool analyzes usage patterns and drives to gather statistics and generate a concise report of recommendations for infrastructure modifications that can increase savings.

Realizing Your Potential Savings

Most organizational leaders aren’t aware of just how much they can save by -optimizing their cloud environments. In fact, it’s not uncommon for businesses to cut as much as 20% of their monthly spend without jeopardizing security or performance. Financial and IT professionals who either aren’t sure how to go about taking advantage of these savings or don’t have time to devote to it should find a partner like Lightstream that is an AWS Advanced Consulting and Microsoft Gold Partner and invests in the tools and talent necessary to secure and optimize cloud environments. Lightstream helps customers re-incorporate financial, technology, operational and security accountability -back into cloud spending either by making it easier for them to monitor and assess their own environments, or by removing the burden entirely and doing it for them.

Lightstream has helped many customers to achieve -cloud optimization. With ongoing management of their cloud environments, on finance alone we save our customers millions of dollars every year. One customer was spending $1.2 million per month in AWS. Their IT team didn’t have the time, resources or visibility they needed to understand exactly where that money was being spent. Upon assessing their environments, Lightstream discovered that they lacked tags and partitions. So, we assisted them in a tagging strategy and determined that they were actually losing money on one of their products. Our Cloud Managed Services (CMS) team optimized the product to -improve its performance and make it profitable, ultimately saving the corporation over $1.5 million annually.

Lightstream offers a free assessment to identify which EBS workloads you should migrate to gp3 volumes and calculate your potential savings using our proprietary EBS optimization analytics application. To speak with a representative about having your environment assessed at no cost to you, contact us today.