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The Worst Conversation in the World of IT - Part II


The Worst Conversation in the World of IT - Part II

The Worst Conversation in the World of IT – Part II

May 24, 2016 – As if the complexity of Cloud services weren’t’ enough, we also have to face the associated “hidden costs”. In our previous post, we discussed the costs surrounding Resource Management. In today’s post, we’ll review three other less obvious (but still major) causes of that conversation, and talk about the best way to mitigate them.

Environment Management Costs – Aside from managing the virtual resources, managing a cloud environment still requires architectural, integration, and administration decisions. If you don’t have the skill set to perform those tasks and make those decisions, you can often see astronomical costs for “fixing” what was put in place. Examples include:

  • Customization – You’re environment is a unique snowflake. Don’t let anybody tell you otherwise. While there are best practices for setting up cloud environments, most require a degree of customization to meet your business needs. Making sure that customization is planned out and prepared for is critical, requiring time and money in the form of customer staff.
  • Maintenance Activities – Just because you have an environment doesn’t mean you can set it and forget it. Software must be patched, data must be recovered, and systems must meet compliance requirements. If you don’t have the skill set, you may be forced to have a CSP do this kind of work.
  • Consultancy – Your architecture matters and the cloud is a much different beast than your traditional equipment stack. In this case, the old adage of “A minute of planning saves 10 in execution” could not be truer. Do you have the skill set to plan your cloud architecture? What about the skill set to make sure your applications will even work in a cloud environment? It’s not a requirement since CSPs oftentimes offer cloud consultation services to help out… at the low, low cost of their obscene SME professional service rates.
  • Poor Integration – Integrating cloud environments with non-cloud (or even other cloud) environments costs money. CSPs use different technologies – all requiring very different areas of expertise. Finding staff that know the ins and outs of all the various portions of your hybrid environment is tough.

Cost Management Costs – It may seem silly to mention “cost management” as a potential cause of getting slammed with “hidden costs”, but the truth is there are important considerations outside of the basic unit price of a CSP:

  • The “Free Tier” – IT’S A TRAP! Or well…It could be. A lot of CSPs have free tiers of service that allow customer to try their service at no risk. There are two problems. First, and this should be obvious: If you run over the resource limits, you will be billed. It seems straight forward, but you might be surprised at how easy it is to be lulled into a false sense of security and overrun on your usage. Second: While a free trial seems like a nice way to try out a service, in actuality it can just serve to hook you on the service without having a real sense of how you’ll get billed – serving to perpetuate the “hidden cost” reputation.
  • Appliance Charges – CSPs offer an impressive array of virtual services and products, but they aren’t free. Assuming you have the skill set in-house to use them, they can help you manage your resources automatically for better or worse (in terms of resource costs). It’s up to the customer to figure out if the skillset and cost of these appliances overcome the savings they can offer.
  • Exit and Migration Fees – Everybody has heard of this, but have you ever looked into the actual costs? In basic cases it serves as a minimal form of vendor lock in that requires a bit of capital to overcome. In extreme cases? Well, just check out any article on what it would cost Netflix if they ever wanted to move out of AWS.

CSP Management Costs – These hidden costs are less about specific costs from the CSP and more about costs you can incur if you don’t manage your CSP selection correctly. CSPs all have different service levels for support, reliability, and security that can cost you money on the business side.

  • Troubleshooting and Support Levels – Many CSPs will help you use their service, but customers need to ask how fast they will respond. Most offer no SLAs around their response time – it’s all best effort. Do you have the time to be leisurely with your activities? What’s the cost of waiting for help to your business?
  • Reliability and Downtime – What’s the cost of downtime to you? Does the CSP offer credits for downtime? Making sure the cloud service you choose meets your reliability requirements is one of the most important things you can do. Also, don’t forget about DR and backup! If you want true reliability, you’ll need to set up two environments – one for production and one for DR!
  • Security and Data Loss – The big one. It goes without saying that different CSPs implement different security measures. Making sure these security measures live up to your requirements is one of the most important things to do when considering what cloud provider to move to. Knowing the risk of data loss and the cost to your business is critical, but the cost if you are unprepared can be astronomical.

Ultimately, with a little due diligence, the right planning, and appropriate staff skillsets, these four categories of “Hidden Costs” are entirely avoidable. Unfortunately, many folks don’t have the time or people for these activities on hand, and have limited budgets to spend the money finding them. As a result, KPS has created a service offering that will ensure you will never need to worry about these issues, and more importantly ensure you never again have to have the talk with your finance folks. You can have your cloud cake and eat it too!