Insights: Case Study

Case Study: Cloud cost optimisation with a state government department

Kinetic IT achieved cloud cost optimisation for a state government department by implementing a bespoke cloud financial model to avoid overspending in the public cloud, and effectively control their cloud costs and budgets.

The Problem


As the migration of workloads and applications to the cloud increased, the department faced growing uncertainty regarding overspending and controlling cloud costs.

The Solution


Kinetic IT leveraged its extensive experience with AWS and Azure to achieve cloud cost optimisation and establish a bespoke cloud financial model including robust principles and procedures for effectively controlling their cloud spending

The Outcome


Kinetic IT’s scalable and adaptable approach to cloud cost optimisation resulted in reduced potential for overspending, granular control over cloud costs, and ongoing cloud cost optimisation due to tailored budgets and alerts, regular reviews, and comprehensive procedures.

Customer Background

Kinetic IT is a trusted professional services provider that has been delivering technology services to a state government department for over 20 years.  The department oversees a diverse landscape, encompassing various institutions, both public and non-governmental, along with regulatory bodies and accreditation councils. With a focus on improving mobility, flexibility, and accessibility, the department is migrating its workloads and applications to the cloud, leveraging Amazon Web Services (AWS) and Microsoft Azure.

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The Problem

Cloud overspending is a widespread global issue, projected to increase as enterprises invest more in public cloud computing. Surveys indicate that around 30% of cloud spending is wasted, emphasising the need for optimised cloud expenditures. To address this challenge, cloud cost optimisation services such as budget tools and alerts are available, allowing organisations to set predefined limits and receive notifications when those limits are approached or exceeded. Both AWS and Azure offer these features as part of their services.

As the migration of workloads and applications to the cloud increased, the state government department faced growing uncertainty regarding the potential for overspending. To address this challenge, the department leveraged Kinetic IT’s extensive experience with AWS and Azure to establish robust cloud cost optimisation principles and procedures to effectively control their cloud spending.

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The Solution

The solution developed by Kinetic IT focused on cloud-agnostic principles and approaches, considering the department’s utilisation of both AWS and Azure. They integrated governance into the toolset, enabling cost and resource usage tracking, establishing guardrails for expenses aligned with project finances, triggering reviews and actions at spending thresholds, leveraging forecasting functionality, and preventing cloud bill shock.

Collaborating closely with stakeholders, the Kinetic IT team determined the required processes for cloud budgets and alerts, validating their ideas through workshops and adjusting them based on stakeholder feedback. The team presented the developed procedures to senior stakeholders, gaining approval for implementation.

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The Outcome

The department successfully implemented an effective, bespoke cloud financial model in collaboration with Kinetic IT. This scalable and adaptable cloud cost optimisation solution can be applied not only to the current cloud service providers but also to future providers. Key outcomes include:

  • Tailored budgets and alerts: The solution provides customised budgets and alerts for all cloud workloads, enabling granular control and oversight.
  • RACI matrix and clear roles: A RACI matrix was established to outline clear roles and responsibilities, ensuring transparency and accountability in cloud spending. It triggers alerts when spending thresholds are reached.
  • Guiding principles and approaches: Specific procedures for cloud budgets and budget alerts were agreed upon, such as mandatory budgets and alerts for all cloud workloads, individualised budgets for applications and projects, and centralised shared cloud infrastructure costs.
  • Baselines and optimisation reviews: Baselines for existing workloads are established using one month’s worth of usage data. Regular workload optimisation reviews ensure ongoing cost efficiency.
  • Comprehensive procedures: Kinetic IT collaborated with the department to design thorough procedures for managing cloud budgets and alerts, covering everything from budget requests to accessing and modifying cloud resources. These procedures promote effective budget management, resource allocation, transparency, collaboration, and knowledge sharing among team members.

By partnering with Kinetic IT, the department has taken significant steps towards ensuring efficient cloud cost optimisation and management. The solution will empower the department to control costs, optimise resource utilisation, and establish a solid foundation for future cloud endeavours.

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Find out more about how we partner with AWS to help Australian organisations securely transition to the cloud and succeed in today’s digital world.

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