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Do It Right:5 Ways to Reduce Azure Cloud Infrastructure Cost

Enterprises are adopting cloud with the intention to reduce infrastructure cost. However, this is not the case always and even we have seen multiple organizations struggling with ever-increasing cloud expenses. In most of the cases we have seen initial saving plummeting to the lowest and then becoming management headache for organizations, that is due to the wrong implementation of cloud resources or running cloud with legacy datacenter mindset. One big mindset change we all need to adopt along with cloud technology is, eliminate the wastage. Here are the 5 quick wins to reduce Azure Infra Cost.

 1. Purchase Reserved Instances: ( Approx. 30% to 35%)

 With the increase infrastructure footprints in Azure, utilization pattern also changes. Reserve instances is the best way to save more than 30% cost for azure VM instances with long visibility. If you have multiple projects running in a same organization, then you should think about creating a VM catalog ( with different VM type and selected geo locations) to choose from, this will help your organization to stay within limited boundaries to achieve more saving.  Here are the key consideration to buy RI.

         I. Scope for every purchase should be Enterprise level: This will help you                to consume RI between subscriptions.

         II. Setup a Service catalog

               a. Based on Geo location.

               b. Based on size flexibility group.

         III. Make all purchases based on least RI ratio for all flexibility group.  

 2.  Shut Down Test and Dev VMs: Approx. 63%.

 Azure Automation is the best way to shutdown VMs during off hours. Majority of development and test environments are being used only during working hours ( 8 to 12 hours max). Also, there will not be any usage during weekends. Considering above points effective usage per week is going to be 12 hours for 22 working days in a month (264 hours out of 720 hours). Here are the two ways you can setup automation.

Automation based on schedule ( off working hours)

Automation based on VM usage for sliding window.

 3. Terminate Test and Dev VMs:

When application environments are moving from on-premise (where you have dedicated test and dev environment) to cloud ( where we pay based on usage), we have seen teams are treating both environment as exactly same. They consider setting up new environments using ARM templates, as and when need arises.  Most of the time, decommissioning of environments happen only due to the cost optimizations projects else resources will keep incurring cost. This should be controlled using policies and automations. One of the solution is, setting up timelines using mandatory lifespan tag and automation to delete resources based on the timestep for lifespan tag. This will defiantly reduce operation overhead and reduce your consumption  cost.  

 4. Resize/Right Size VMs:

We can create our custom reports and analyze VM utilization trend to identify the right size based on consumption parameters. However, my preferred way to identify the right size for VM is using Azure Adviser. It gives multiple recommendations based on the consumption pattern along with estimated saving. I will recommend using scale out if utilization increases rather than scale up ( if design permits). I am sure you will be surprised to see saving coming in after you implement all these recommendations.

 5. Identify and delete Ghost Resources:

When we delete VM in Azure, any disks that are attached to VM will not get deleted, this is only to avoid data loss due to accidental deletion. Post VM deletion also, disk will continue to incur cost. I considered this as ghost cost for resources, we don’t even care about in most of the situations. This seems like a small amount if you calculate for an hour, but over the time this will pile up a big cost which you will not be aware about. You can refer MS document: (https://docs.microsoft.com/en-us/azure/virtual-machines/windows/find-unattached-disks) to find and delete these resources to save cost.

 Azure is not about migrating infrastructure fast, it is about do it right at the first place. Cloud adoption can become nasty if this is not implemented right from the start. Hope, this will be helpful to save cost and bring billing governance!! Happy Reading..

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WFH wrong implementation, threat to companies’ existence!!

WFH culture adoption is already too late for IT industry. Multiple internet research shows that PC market is declining, and global laptop/tablet sales had seen a boost in demand. This is all because companies are exploring WFH option from past decade, but never had full success as this needs a mindset change. Finally, Covid-19 forced IT companies to espouse WFH. My last article clearly called out that WFH adoption is inevitable for all IT companies.

After effect of Covid-19 will trigger trade war and customer will start expecting share in infrastructure saving. Companies desperation to revive will force them to reduce infrastructure/operation cost further. Recent industry trend started showing that companies are changing habits to accept this “New Normal”, working on reducing operation cost, roles are going through transformation changes and work consolidations is envisioned as future of industry life. This will finally lead to layoffs and work complexity will increase across industries. Companies need to make sure to instrument this right. Wrong implementation can become threat to even company’s’ existence.

Here are the top five challenges for an IT industry to adopt WFH culture:

1.      Physical distancing: Informal communication considered as one of the quickest ways of communication and this tool were actively used by corporate leaders to resolve conflicts. We have seen aggressive conference room fights changing into consensus during coffee breaks or going for a walk. Corporate meetings moving to virtual platforms are resulting into social distancing and more professionalism. Will see lot of groundbreaking ideas looming in near future to solve this physical distancing problem.

 For sale organizations also, cold calling never gives access to customer offices. That is the meticulous reason for companies setting up sales offices in proximity to customer presence. This helps organizations to build connect, understand business needs and finalize deals. Customer organizations also connecting virtually, will bring a shift change for sales organizations. Keeping a personal connect despite of physical distancing will be a mahout task for sales group.

 2.      Talent replacement and training: Training was the prime reason for companies to force teams to work from office. During Covid-19 time, companies are struggling to onboard and train new members. Existing learning content/tools lack personal attention. Training a person, sitting next to trainer is effective and quick. Understanding corporate culture, team collaboration, training and assistive performance is more effective in physical environment.

 Complete team sitting at one place also boosts team moral and collaboration. It is evident that teamwork benefits organizations to move fast and deliver uniformity in customer delivery. Modernization of educational tools is an answer to this question.

 3.      Corporate governance and productivity tracking: Physical office environment demands different style of governance, corporate policies and stakeholder management. It all started with traditional way of manual tracking, where project manager keeps an eye on team members, people function team organizing huddles and daily stand-up calls to get status updates. Product companies moving to open office culture, where team sits in cubicles instead of private offices. This sitting arrangement were helping team to collaborate more and take fast decisions.

 It becomes tough to put governance policies for teams WFH. Need of all stakeholders’ changes when they are WFH. Most of the corporate already started brainstorming to identify employees’ future needs and make necessary policies changes to bring comfort to employees’ life when team is WFH. For productivity tracking, we are seeing a trend of new tools coming our way. Lately we saw most of the companies started tracking minimum working hours using laptop tracking applications.

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 4.      Inventory management and distribution: Organizations are spending huge money for internal IT needs; employees can walk-in to get a new asset or get their old asset repaired etc. Now in the “New Normal”, employees are looking for remote on-boarding and onsite desktop support. These new expectations are going to add delay, productivity loss and cost of shipment if not implemented properly.

 Providing onsite support and shipping has cost associated with it and need enormous manpower if company decided to deal all these challenges internally.

 5.      Information security: Information security gives shivering in spinal cord when you ask any IT manager about adding BYOD or open network etcetera as part of compliance boundaries. Covid-19 has thrown a challenge in front of IT departments to keep all devices up to date with patches, groups and organizational policies.

 Modernization of Classic IT management is the solutions to this problem. As organizations are not going to have much control on the network, IT department are building more controls on device level. Mobile device management using cloud based active directories is envisioned as future of IT management.

 Conclusion: Challenge gives birth to opportunities. WFH has multiple benefits, and innovations will take care of all these challenges as they come. Organizations need to adopt this precisely to avoid all threats. We all can think about multiple brands, lost their existence while adopting digitization in nineties. I believe that, companies understand the need to adopt this change to be part of all future race.

  Stay tuned for my next article to know, how to do it right!!

[guptavarun]

WFH future for all IT companies

Business continuity planning never taken that seriously before. Most of the time, it considered as setting up offices in multiple locations. When needed make people travel or call team from other location to take up work. This model works only when we have to manage situation for hours or max to couple of days.

Every challenge has opportunity to improve. Covid-19 forced every organisation to test true BCP. Situation where multiple countries were on full lock-down, 100% employees were forced to WFH. I must say, most of the IT companies did a great job of quickly moving workforce to home. During these circumstances, companies also realised that office infrastructure is not mandatory to deliver work. Companies are spending gigantic part of annual budget on office infrastructure requirements.

Looking at the current environment, IT companies have one and only one option in hand, which is embrace WFH (Working from Home).

Here are the top five reasons for an IT industry to adopt WFH culture:

Office Infrastructure cost: From last one decade, land price in metro cities were sky rocketing. In the recent past, we observed that companies started adopting remote shoring by focusing on tier-2 cities to reduce infrastructure cost.

 Never predicted 100% WFH is going to be the future of IT companies. By accepting WFH culture, companies are not only going to save huge amount of money on infrastructure, but also on food, maintenance and admin overheads etc.

 Freelance a success story: You can find so many success stories over internet, where companies started with freelance business and established their name in market. On an average, per hour rate for freelance engineer is higher as compare to an employee working in a company. That is because of very less overheads. This success story will definitely add impetus to WFH adoption.

 Office Commute time: Traffic in all metro cities mounting like anything. Governments are concerned and working with corporate companies to find a solution to this problem. Average commute time for an employee vary from 18% to 30% of business working hours.

Post adoption of WFH, companies are seeing increase in average productive hours. Employees are saving commute hours and ready to join early hours meetings with team in other geographical locations. This is leading towards more employee satisfaction and productivity increase.

Revised Customer Expectations: Customer expectations are increasing. We observed that customers are keen to understand BCP and WFH readiness in all new business contracts. Security is becoming a prime concern for customer, when team connects with home internet. However, it is also important to understand the investment corporate are ready to make to avoid any business disruption.

 Business meetings are diverting towards understanding case studies for WFH. As this is also saving cost for organisations, market is seeing different kind of negotiations for all future contracts.

 Talent retention and replacement cost: I have been part of multiple discussions, where employee resigned due to health or spouse mobility issues. Every resignation is an enormous cost to company. Team has to hire replacement, spend lot of money on relocation/travel expenditures and major cost is coming from on-boarding and training expenses.

 For working Women this is tough to manage family along with growing expectations of working hours also long commute time. Gender diversity is becoming a cause of concern for companies and losing great talent. WFH will help to boost employee satisfaction and longevity in company.

 Conclusion: IT companies are going to go under transformation changes to accept that new way of working. Several opinions are about difficulties companies are going to face during this transformation journey; however, delay of adoption can have a major dent for business growth. Early adoption and acceptance will help your organisation to come out fast during this tough time.

WFH wrong implementation, threat to companies’ existence!!