Cloud Cost Allocation: 3 Best Practices

By Author: Centilytics
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1. Establish a cost structure using accounts.
Your cloud infrastructure alone is simply that—a piece of equipment. To start accounting for your cloud spending at unit level, you must connect the resources you utilise to important business KPIs into a business environment.

One method to do so is by segmenting the account—using several accounts to build a cloud cost structure.

A few years ago, all AWS resources held by a company had to be handled via one account. As resources grew, monitoring the usage of these resources became unbelievably complex. Amazon now permits (and promotes) the usage of several accounts as a best practise for streamlining expenses and resources.

2. Use tagging to connect key business metrics.
Tagging or classifying your cloud resources is another method to give business context to your cloud expenses. Tags are the most common method of transferring business logic to cloud resources. Tags were first introduced to Amazon Web Services (AWS) in 2010, and the feature has only become better since then.

You may utilise the tagging feature to create keys ...
... and values that can be used to classify, filter, and sort resources. You may categorise resources by the context in which they're being utilised, the team or department that's utilising them, or the functionality they support.

Define the cost allocation tags when using cloud cost allocation platform.

Tagging is only effective if your team applies a single tagging policy to all AWS accounts and multi-cloud setups.

At the absolute minimum, you should be aware of three aspects of any resource deployed in your environment:
1. The resource's purpose or function. Simply stating that a resource is a database is insufficient. Instead, figure out which service is utilising the database's data. That is, what service is supported by the resource?
2. The resource's proprietor. What team or department should be held accountable if anything goes wrong with the resource?
3. The setting in which the resource is used. Is the resource a production system, a quality assurance system, or something else?

3. Establish a common understanding of cost and accountability.
It's critical to have a common knowledge and accountability for cost, in addition to labelling and establishing structures via accounts. Organizations that effectively manage their AWS investment often use some kind of metric to measure performance — a budget or a unit cost, for example — but there is a clear expectation that everyone is accountable for expenses.

Each team should be expected to achieve cost goals while developing systems, just like any other operational measure performance, such as security.

Centilytics -- an intelligent cloud management platform -- provides innovative and effective solutions that enable you to efficiently manage, secure, automate, and optimize your cloud infrastructure. https://www.centilytics.com/