The cloud has transformed the way organizations operate and has become an integral part of business operations. With it, businesses can store, access, and process data from anywhere in the world, making it easier to scale and grow their operations. “By 2025, Gartner estimates that over 95% of new digital workloads will be deployed on cloud-native platforms, up from 30% in 2021.” However, cloud optimization is still a challenge for many organizations, and it requires careful planning, monitoring, and management.
In this blog, we will discuss five of the most common cloud optimization challenges and how organizations can avoid them.
1. Cost management
Cost management is one of the biggest challenges that organizations face when it comes to cloud optimization. Cloud services are often billed on a pay-as-you-go basis, which means that businesses only pay for the resources they use. However, this model can be tricky to manage as costs can quickly spiral out of control if businesses are not careful. As an analogy, setting up cloud services without proper architecture or maintenance is like putting a Halloween candy bowl outside your door and expecting it to still have candy in it throughout the night. One of the most significant drivers of cloud costs is poor allocation. Organizations that fail to allocate resources efficiently can end up wasting resources, leading to increased costs and reduced performance.
According to a survey conducted by Foundry, 82% of organizations identified cloud cost management as their top priority in 2023. In the same survey, 45% of respondents said they had exceeded their cloud budget in 2020, with 9% exceeding their budget by more than 20%.
What this sheds light on is the importance of managing cloud costs and the need for organizations to implement strategies to reduce their cloud spend. One way to do this is to use cloud-native tools that provide visibility into cloud costs, usage, and performance. This can help businesses identify areas where they can optimize their cloud utilization and reduce costs. However, this requires in-house specialists to monitor and respond to issues, which could also increase costs significantly as the business grows.
Another way to control costs would be to utilize qualified outsourced resources or a Managed Service Provider (MSP) with a Network Operations Center (NOC) that could monitor and respond to cloud utilization as it’s happening. While an MSP NOC is an additional cost, it’s more predictable and a fraction of the costs than a medium to large organization could incur month-to-month.
2. Complexity
Cloud environments can be complex and require specialized skills to manage effectively. As a result, many organizations struggle with cloud optimization due to a lack of in-house expertise or the cost of hiring external experts.
While optimizing cloud infrastructure is essential, over-optimizing can lead to problems. Over-optimization can occur when businesses focus too much on cost savings and ignore other factors such as performance, scalability, and security. This can lead to an infrastructure that is too complex, difficult to manage, and unable to meet the needs of the business.
According to a survey conducted by IDG for HubSpot, “the majority (79%) of respondents also report significant downsides to using a multi-cloud model. These include increased complexity (48%), increased training and hiring costs (34%), and increased costs due to cloud management and security challenges (28%).”
These statistics highlight the importance of investing in training and development programs to ensure that in-house staff have the skills and knowledge needed to manage cloud environments effectively. Businesses can also consider outsourcing some aspects of cloud management to external experts to help fill any skills gaps, especially on the operational and day-to-day side.
Additionally, organizations should focus on finding the right balance between cost savings and other critical business requirements. They should prioritize their goals and ensure that their optimization efforts are aligned with those goals and desired outcomes.
3. Security
Security is another major challenge that businesses face when it comes to cloud optimization as it’s not included “out-of-the-box” with many IaaS/SaaS offerings. Cloud environments are inherently complex and securing them requires a multi-layered approach. This includes implementing strong access controls with multi-factor authentication, as well as securing data by encrypting in transit and at rest. They should also leverage cloud-native security tools that provide insights into security threats and vulnerabilities.
In a survey conducted by LogicMonitor, 66% of IT decision-makers believe that security is their biggest challenge when it comes to cloud adoption. More surprisingly, it additionally found that 71% of organizations have experienced a cloud security incident in the past year.
Those numbers showcase the importance of implementing robust security measures to protect cloud environments from security threats. Businesses need to ensure that they have the right security controls in place, that they are regularly monitoring, and they are performing periodic security assessments of their cloud environments for internal and external security threats.
Most medium to large-sized companies don’t have the internal IT security resources in place necessary to monitor and respond to threats. This is where partnering with a Managed Security Services Provider (MSSP) is a critical path for companies. Gartner defines an MSSP as utilizing “high-availability security operation centers (either from their own facilities or from other data center providers) to provide 24/7 services designed to reduce the number of operational security personnel an enterprise needs to hire, train and retain to maintain an acceptable security posture.” An MSSP provides the detection and response that a business needs without having to increase costs and headcount.
4. Performance
Cloud performance is another challenge that organizations face when it comes to cloud optimization. Cloud environments are designed to be highly scalable and to support a wide range of workloads. However, as workloads grow, performance can suffer if organizations don’t optimize their environments for their changing operational needs.
Another factor leading to poor cloud performance is the lack of automation. Automation is a critical component of cloud optimization, as it can help businesses reduce costs, improve performance, and ensure consistency. However, some organizations fail to implement automation effectively, leading to increased complexity and difficulty in managing their infrastructure.
According to a survey conducted by Ixia/Keysight, “Nearly 70% of participants stated that public cloud monitoring is more difficult than monitoring data centers and private clouds. Nearly all of those surveyed (99%) identified a direct link between visibility and business value. The results confirm that comprehensive cloud visibility is key to maintaining cloud security and performance.”
What this brings to the surface is the importance of optimizing cloud environments for performance. Businesses need to ensure that they are using the right cloud resources for their workloads and that they are regularly monitoring their cloud environments for performance issues.
5. Governance
Governance is another challenge that organizations face when it comes to cloud optimization. Cloud environments can be complex, and managing them requires careful planning, monitoring, and management. This includes implementing policies and procedures to ensure that cloud environments are being used in a way that is compliant with regulatory requirements and industry best practices.
One of the inhibitors organizations face when attempting to properly govern their cloud infrastructure is a lack of visibility. Without visibility, businesses cannot effectively monitor and manage their infrastructure, leading to performance issues, security vulnerabilities, increased costs, and decreased overall governance.
According to a survey conducted by Deloitte, organizations believe that governance is their biggest challenge when it comes to cloud adoption. In the same survey, 59% of respondents said that they feel their organization’s cloud governance is “Non-existent” (42%) or “Insubstantial / too lax” (17%).
Clearly, there is strong evidence dictating the importance of implementing robust governance measures to ensure that cloud environments are being used in a way that is compliant with regulatory requirements and industry best practices. Businesses need to ensure that they have the right policies and procedures in place and that they are regularly monitoring their cloud environments for compliance issues.
Conclusion
Cloud optimization is a complex and ongoing process that requires careful planning, monitoring, and management. Cost management, security, performance, governance, and complexity are some of the key challenges that organizations face when it comes to cloud optimization.
To overcome these challenges, businesses need to implement strategies to manage cloud costs, secure cloud environments, optimize cloud performance, implement robust governance measures, and invest in training and development programs to ensure that in-house and/or outsourced staff have the skills and knowledge needed to manage cloud environments effectively.
While global enterprise-sized companies can adequately staff for cloud environments, everyone else, from small to large companies, benefit from outsourcing some or all their cloud architecture, operations, and/or security resources. Whether it’s finding the right skillsets needed to properly architect a solution and secure it, and/or having the proper toolsets and teams to monitor and react to issues, intentional outsourcing is a must for most companies to be successful in an environment that now moves at the speed of light.
By addressing these challenges and implementing best practices for cloud optimization, businesses can realize the full benefits of cloud computing, including improved agility, scalability, and cost savings.
