Avoiding Snowballing Cloud Costs with a Cloud Managed Services Provider

December 20, 2022

Snowballing Cloud Costs

Cloud costs are going up, which hurts profit margins, income, and the total cost of goods sold. As a business grows, it becomes more important than ever to be efficient.

CIOs are put in a difficult position as rising cloud prices and declining value show the limitations of the traditional methods of controlling IT finances and procurement. The cloud virtually eliminates the need for quarterly budgeting and capital planning and instead necessitates constant monitoring of services purchased and consumed on a per-hour, if not per-second basis. The company’s economics have shifted by the time the IT finance team sits together to discuss them.

Financial management is now an integral part of a company’s economic decision-making in the hybrid cloud. The outdated approach of keeping infrastructure, development, and IT finance teams in their own separate silos is no longer productive.

In this instance, engineers and finance professionals work together as one team from the outset, pushing financial management out of governance and into operations. A fundamental skill in the IT industry is the ability to understand the economics of the industry. As a result of the automation of procurement processes and the flexibility built into the contracts, vendors can respond to market fluctuations with ease.

The Cloud Managed Services Provider Solution

At first, cloud services were sold as a cheaper way to manage information technology. As more and more businesses move to the cloud, it’s becoming clear that costs can add up quickly if not kept in check. In fact, Gartner’s research shows that spending on public cloud services by end users around the world grew by almost 19% in 2022 and is expected to grow by another 20.7% in the coming year.

Understandably, customers are beginning to wonder if cloud costs are staying as expected or entering a snowball effect. Even though public cloud services have been around for a while, they have only recently become popular with the general public, thanks to better infrastructure and the success of early adopters in the business world. Small and medium-sized businesses were attracted to public cloud operators like Oracle Cloud Infrastructure (OCI), Amazon Web Services (AWS), Google Cloud, and Microsoft’s Azure Cloud Services, which offer precise amounts of computing power at any given time, making it easy to scale their services while only paying for the resources they use.

Less than a few years ago, cloud conversations were all about saving money, and the idea that clients only pay for what they use is quickly going away. The economics of the cloud, how it works, and whether or not it’s possible are not what they seem to be. It can be very expensive, and the story is changing. Overall, people still think that public cloud services are a good deal, but results can vary.

Working with a cloud managed services provider who knows how to get the most out of the cloud can help small, medium, and enterprise-sized businesses get the most out of their budgets. That way, if things don’t work out the organization expects them to, clients can shift, change, adapt, or even stop before spending a lot of money moving everything over only to find out it doesn’t work or costs are too high. All in all, if clients don’t keep track of the resources they use once the business is up and running, costs can add up quickly.

There are tools and strategies that a cloud managed services provider can employ to help reduce cloud spending by increasing visibility, automating service management, and finding lower-cost options for lower-priority functions. When discussing the cloud, clients should stay away from wanting more cloud capabilities than what they need, but always have enough to meet the needs of end users.

Here are four strategic ways a Cloud Managed Services provider helps optimize cloud costs:

1. Review of Technological Deficiencies and Conflicts
Because many businesses adopt cloud services gradually, holes and overlaps in the system are common. Multiple services may be duplicated inside an organization, or a task may not be adequately addressed by any existing software. If a company uses a cloud managed services provider to analyze its pipeline, it will be able to close any gaps and eliminate any unnecessary overlaps, resulting in more efficient and economical operations.

The cloud managed services provider may do much more than simply locate areas of weakness and duplication. For instance, some businesses might be aware of the fact that some of their data is already redundant. However, they might not be able to deal with the redundant information because they lack the resources to do so. When a business hires an MSP, they gain access to a team of experts who can engage with them and provide the guidance they need during the transition.

2. Avoiding Pricey Privacy and Security Problems
A cloud managed services provider like IT Convergence specializes in protecting their clients’ cloud infrastructure. A large security breach can have devastating financial consequences. As a matter of fact, most modern businesses are under constant attack from all around the world. With the assistance of a cloud managed service provider, a business can increase its defenses against costly cyberattacks and lessen the likelihood of suffering irreparable damage.

Threats from cyberattacks are only going to increase in severity and frequency. It doesn’t matter if a business is on-premises or in the cloud; if they don’t take steps to improve their security now, they will just grow more exposed later.

3. Resource Monitoring and Analysis
A cloud managed services provider can devise tracking and analysis techniques to learn where and how funds are being spent. The cloud managed services provider will know which programs are hogging too many resources and when such hogging times occur during peak usage times. Organizations will have continuous visibility into their resource utilization and be able to make educated decisions about whether to enhance or decrease their resource budget accordingly. With cloud computing, you can “pay as you go” for exactly what you need, and the model works perfectly with the seasonal fluctuations that many organizations face.

4. Enhancing Existing Methods and Procedures
Most businesses discover that their spending escalates as a result of increased resource use. It’s possible that businesses can’t afford to invest in audits or optimization, and thus can’t afford to invest in making their processes better. MSPs are external to the firm, so they have the luxury of time to devote to figuring out where they can best make the most impact in terms of reducing wasteful expenditures. IT Convergence is an experienced Cloud Managed Services provider that takes a flexible and scalable approach with clients, deploying processes and tools to manage their cloud infrastructure with a pricing model that is tailored to the needs of each of its customers.


Although there are numerous advantages to cloud computing, keeping costs under control can be a hurdle for some businesses.

Migration, modernization, and platform development can eat into the cloud’s favorable economics. Cloud managed services like those provided by IT Convergence have the ability to increase a company’s savings, but this could be jeopardized if companies fail to address cloud economics quickly. In order to identify bottlenecks and opportunities for improvement in IT finance, procurement, and development processes, the company should integrate an expert party that can manage and oversee their cloud services. That way executives can plan for the future of IT funding, vendor management, and optimization. Aside from that they are able to spot possibilities for swiftly cutting expenses by adjusting the way cloud environments function.

Correctly placing workloads is the first step in cost reduction, and CIOs are increasingly interested in hybrid cloud since it helps them to keep expenses in check while still meeting performance benchmarks. Cloud managed services methods for realizing potential savings and capturing the business value, such as accurate cost models, integrated tools, and observability across the technological plant, are essential for product, engineering, procurement, and finance teams.

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