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Azure cost management plays a vital role in controlling cloud costs, especially as businesses in New Zealand scale their cloud infrastructure. As cloud usage grows, managing resources becomes more complex, often leading to inefficiencies and overspending. Without a proper cost management tool in place, businesses risk wasting valuable resources on underutilised services or paying for more capacity than they actually need.

Additionally, unpredictable cloud bills can disrupt financial planning, making it difficult for businesses to allocate budgets effectively. Azure cost management provides transparency into cloud spending, enabling organisations to track costs, identify areas of waste, and gain control over their cloud expenses. By offering real-time insights and cost analysis, businesses can avoid unnecessary expenses and prevent billing surprises.

Ultimately, by optimising cloud usage through Azure cost management, businesses can streamline operations, improve financial governance, and ensure they are using Azure resources in the most cost-efficient manner possible.

Key features of Azure cost management

Azure cost management offers several tools to help businesses manage and optimise their Azure spending.

Azure cost analysis reports

Azure cost analysis reports provide detailed insights into usage patterns, cost anomalies, and optimisation opportunities. By examining these reports, businesses can view their Azure resources and identify areas where they can reduce cloud spending.


Azure cost budgets and alerts

With the budgeting feature, users can set spending limits and receive alerts when approaching their budget. This improves cloud governance and prevents overspending by keeping resource usage within defined limits.


Azure Advisor integration

Azure Advisor provides personalised recommendations to help businesses save costs on Azure services. This integration allows users to view cost-saving recommendations directly in the Azure portal, improving cloud cost optimisation.


Custom APIs and Power BI integration

Azure cost management lets users create custom views of their cost data. This allows deeper cost analysis when integrating with Power BI. It gives businesses the ability to visualise and explore their cloud spending in greater detail.


Benefits of Azure cost management for your business

Azure Cost Management delivers several advantages that benefit both financial and operational aspects of businesses.

Cost visibility across departments

Tagging resources allows businesses to map costs to specific departments or initiatives. This gives detailed visibility into cloud spending and makes it easier to allocate expenses across departments.


Predictive budgeting and cost forecasting

Using advanced analytics, Azure Cost Management lets businesses forecast future cloud costs based on current usage patterns. This helps companies plan future expenses and align cloud budgets with business goals.


Resource optimisation and efficiency

Azure’s cost management tool identifies underutilised resources, such as idle resources or overprovisioned virtual machines. This allows businesses to right-size their infrastructure and eliminate waste.


Governance and control with budgets

By setting automated budgets and spending limits, businesses can enforce financial governance over their cloud usage, ensuring that Azure spending stays within their planned budget.


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Best practices for Azure cost management

To fully optimise cloud costs, businesses should follow a few best practices.

Tagging resources for cost tracking

Tagging is essential for tracking resource usage and cost attribution. It ensures each department or project can be allocated their portion of the Azure bill.


Setting cost alerts and budget limits

Configuring alerts and budget limits helps businesses control cloud spending. By receiving notifications when nearing budget thresholds, businesses can take action to prevent overspending.


Monitoring resource utilisation regularly

Regular monitoring of resource usage helps prevent overprovisioning. By analysing resource group usage patterns, businesses can adjust resource allocations in real-time.


Exploiting autoscaling for cost savings

Autoscaling ensures that resources automatically adjust based on actual usage. This eliminates the cost of overprovisioned resources and ensures that businesses only pay for what they use.


Understanding Azure pricing models to reduce costs

Azure offers various pricing models that can affect cloud costs. For example, choosing between Pay-As-You-Go or Reserved Instances depends on the workload type and resource usage. Reserved Instances offer better long-term savings, especially for predictable workloads.


Azure cost management tools

Using Azure cost analysis

The cost analysis tool helps users view costs by different dimensions such as resource group or service, offering an in-depth look at cloud usage and costs.


Utilising Azure pricing calculator

The Azure pricing calculator estimates future costs based on current Azure subscriptions. This helps businesses plan for upcoming cloud expenses and adjust their cloud usage to reduce costs.


Managing budgets with Azure cost management

Azure Cost Management allows users to create and monitor budgets, ensuring that cloud spending remains within predefined limits.


Common Azure cost Management pitfalls to avoid

Businesses often make common mistakes when managing Azure costs, such as overprovisioning resources or missing out on savings by not leveraging Reserved Instances. To avoid these pitfalls, businesses should right-size their resources and make use of the cost-saving features Azure offers.


Industry examples of Azure cost management success

Finance industry: Using reserved instances to save costs

A finance company significantly reduced its cloud costs by utilising Azure's Reserved Instances. By locking in lower rates for long-term commitments on essential services, the company ensured predictable billing and maximised cost savings. Reserved Instances provided the financial stability needed to support ongoing, mission-critical operations while avoiding the unpredictable expenses associated with Pay-As-You-Go pricing.


Retail industry: Autoscaling to manage seasonal workloads

A retail company optimised its cloud spending by leveraging Azure's autoscaling feature to handle fluctuating demand during peak shopping seasons. Autoscaling allowed the company to automatically adjust its resource capacity based on real-time traffic, scaling up during high-demand periods and down during slower times. This approach ensured that the company only paid for the resources it needed, reducing unnecessary costs and improving overall cost efficiency during busy retail cycles.


Step-by-step guide: Getting started with Azure cost management

How to enable Azure cost management

To enable Azure cost management, log into your Azure portal and navigate to the "Cost Management + Billing" section under your billing account. From there, you can enable the cost management tools that allow you to track and optimise your Azure spending. This feature integrates seamlessly with your Azure subscriptions, giving you immediate access to cost analysis, budgeting, and spending alerts. Once enabled, you can start tracking your cloud usage and implementing strategies to reduce unnecessary spending and improve cloud cost efficiency.


Setting up cost alerts and budgets

Setting up cost alerts and budgets within Azure cost management is a crucial step in controlling cloud spending. Start by creating a budget for each of your subscriptions or resource groups, specifying a spending limit aligned with your financial goals. Then, configure alerts to notify you when your usage approaches these limits. These real-time alerts allow you to take proactive measures, such as adjusting resource usage or reviewing your services, to prevent exceeding your budget and improve overall cloud governance.


Using Azure cost analysis for detailed reports

Azure cost analysis provides detailed reports that break down cloud costs across various dimensions, such as resource groups, services, and usage patterns. To access these reports, navigate to the cost management section of the Azure portal and select "Cost Analysis." Here, you can view cost data in real-time, analyse trends, and identify areas where you might be overspending. The tool allows you to filter and customise reports, giving you the flexibility to drill down into specific details and optimise resource allocation to reduce cloud spending.


Future trends in Azure cost management

Future trends in Azure cost management point towards greater integration of AI-driven recommendations, enhancing how businesses manage and optimise their cloud costs. As cloud environments grow more complex, AI will play a crucial role in identifying patterns and inefficiencies that may be difficult for users to detect manually. By leveraging machine learning, Azure will offer personalised cost-saving recommendations based on actual usage patterns, helping businesses make smarter, data-driven decisions to reduce unnecessary spending.

Another key advancement will be in predictive analytics, where Azure will provide even more accurate forecasts of future cloud expenses. With deeper insights into historical usage and cost trends, businesses will be better equipped to plan for future growth, avoiding unexpected spikes in cloud spending. These predictive capabilities will allow organisations to anticipate future costs more effectively, ensuring they stay within their budget and align cloud spending with business goals.
Moreover, these future developments will likely improve automation in cost optimisation, allowing businesses to automate actions based on AI insights, such as right-sizing resources or utilising more cost-efficient service tiers. As Azure continues to enhance its cost management tools, businesses will benefit from improved visibility, accuracy, and control over their cloud expenditures, empowering them to operate more efficiently in an ever-evolving cloud landscape.

Frequently asked questions

What is Azure cost management?

Azure cost management is a set of tools that help businesses monitor, manage, and optimise their Azure spending by providing cost analysis, budgeting, and alerts. 

How do I enable Azure cost management?

To enable Azure cost management, you need to log into your Azure portal, navigate to your billing account, and enable the cost management tools for your Azure subscriptions. 

What is Azure cost optimisation?

Azure cost optimisation refers to the practice of reducing unnecessary cloud spending by using tools and strategies such as cost analysis, autoscaling, and Reserved Instances. 

What is the difference between cost management and pricing calculator in Azure?

Cost management helps monitor and control your actual Azure spending, while the pricing calculator estimates future costs based on your current resource configurations. 

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