This principle in the cost optimization pillar of the Google Cloud Architecture Framework provides recommendations to align your use of Google Cloud resources with your organization's business goals.
Principle overview
To effectively manage cloud costs, you need to maximize the business value that the cloud resources provide and minimize the total cost of ownership (TCO). When you evaluate the resource options for your cloud workloads, consider not only the cost of provisioning and using the resources, but also the cost of managing them. For example, virtual machines (VMs) on Compute Engine might be a cost-effective option for hosting applications. However, when you consider the overhead to maintain, patch, and scale the VMs, the TCO can increase. On the other hand, serverless services like Cloud Run can offer greater business value. The lower operational overhead lets your team focus on core activities and helps to increase agility.
To ensure that your cloud resources deliver optimal value, evaluate the following factors:
- Provisioning and usage costs: The expenses incurred when you purchase, provision, or consume resources.
- Management costs: The recurring expenses for operating and maintaining resources, including tasks like patching, monitoring and scaling.
- Indirect costs: The costs that you might incur to manage issues like downtime, data loss, or security breaches.
- Business impact: The potential benefits from the resources, like increased revenue, improved customer satisfaction, and faster time to market.
By aligning cloud spending with business value, you get the following benefits:
- Value-driven decisions: Your teams are encouraged to prioritize solutions that deliver the greatest business value and to consider both short-term and long-term cost implications.
- Informed resource choice: Your teams have the information and knowledge that they need to assess the business value and TCO of various deployment options, so they choose resources that are cost-effective.
- Cross-team alignment: Cross-functional collaboration between business, finance, and technical teams ensures that cloud decisions are aligned with the overall objectives of the organization.
Recommendations
To align cloud spending with business objectives, consider the following recommendations.
Prioritize managed services and serverless products
Whenever possible, choose managed services and serverless products to reduce operational overhead and maintenance costs. This choice lets your teams concentrate on their core business activities. They can accelerate the delivery of new features and functionalities, and help drive innovation and value.
The following are examples of how you can implement this recommendation:
- To run PostgreSQL, MySQL, or Microsoft SQL Server server databases, use Cloud SQL instead of deploying those databases on VMs.
- To run and manage Kubernetes clusters, use Google Kubernetes Engine (GKE) Autopilot instead of deploying containers on VMs.
- For your Apache Hadoop or Apache Spark processing needs, use Dataproc and Dataproc Serverless. Per-second billing can help to achieve significantly lower TCO when compared to on-premises data lakes.
Balance cost efficiency with business agility
Controlling costs and optimizing resource utilization are important goals. However, you must balance these goals with the need for flexible infrastructure that lets you innovate rapidly, respond quickly to changes, and deliver value faster. The following are examples of how you can achieve this balance:
- Adopt DORA metrics for software delivery performance. Metrics like change failure rate (CFR), time to detect (TTD), and time to restore (TTR) can help to identify and fix bottlenecks in your development and deployment processes. By reducing downtime and accelerating delivery, you can achieve both operational efficiency and business agility.
- Follow Site Reliability Engineering (SRE) practices to improve operational reliability. SRE's focus on automation, observability, and incident response can lead to reduced downtime, lower recovery time, and higher customer satisfaction. By minimizing downtime and improving operational reliability, you can prevent revenue loss and avoid the need to overprovision resources as a safety net to handle outages.
Enable self-service optimization
Encourage a culture of experimentation and exploration by providing your teams with self-service cost optimization tools, observability tools, and resource management platforms. Enable them to provision, manage, and optimize their cloud resources autonomously. This approach helps to foster a sense of ownership, accelerate innovation, and ensure that teams can respond quickly to changing needs while being mindful of cost efficiency.
Adopt and implement FinOps
Adopt FinOps to establish a collaborative environment where everyone is empowered to make informed decisions that balance cost and value. FinOps fosters financial accountability and promotes effective cost optimization in the cloud.
Promote a value-driven and TCO-aware mindset
Encourage your team members to adopt a holistic attitude toward cloud spending, with an emphasis on TCO and not just upfront costs. Use techniques like value stream mapping to visualize and analyze the flow of value through your software delivery process and to identify areas for improvement. Implement unit costing for your applications and services to gain a granular understanding of cost drivers and discover opportunities for cost optimization. For more information, see Maximize business value with cloud FinOps.