Some 40% of IT leaders say that continued migration to the cloud and data centre exits are critical to reducing IT costs in the next 12 months , while 39% also believe cloud native services help them to reduce licensing costs. But there is a problem.
Too many organisations are struggling to have control and visibility of the true cost of cloud provision. Despite the fact that virtually all the organisations we surveyed (99%) are utilising cloud technology, only 27% say they are greatly exceeding the value they expected from their cloud investment, largely due to rushed implementations and flawed service configuration.
As we have discussed, many IT organisations have overspent on these services, while others did not optimise workloads and have cloud services that are not configured for their specific needs. This is a form of technical debt - the price companies pay for short-term delivery of projects at the expense of long-term efficiency. It’s an approach that solves immediate problems and needs (like needing to support remote working) but doesn’t deliver long-term value.
One strategy to combat this issue is using FinOps practices to evaluate and understand the performance and potential of cloud platforms and services. In our survey, 80% of respondents say they will increase their investment in FinOps this year to address the efficiency and effectiveness of cloud IT spending and 40% rated FinOps as a priority to reduce IT costs. The only other cost reduction priorities similarly ranked were ‘reducing IT labour costs by outsourcing’ and ‘continued migration to cloud from data centre exits’.