Why The Budget Tool In The Azure Cost Management Solution Might Not Always Help

CloudHealth Tech Staff Cloud Tech Journalist
Published: January 23, 2020
5 Min Read

If you’re struggling to meet Azure budget targets every month, you may be interested to learn there’s a new budget tool in the Azure Cost Management solution. However, using the tool on its own might not help you meet your budget targets as much as you would hope. 

Earlier this year, Microsoft released its new Azure budget tool. The tool is available via the Azure Cost Management section of the Azure portal and allows users to set budgets for specific products and services. Then, when the spend-to-date reaches a user-defined percentage of the budget, the tool triggers an email notifying the user they’re closing in on their budget threshold. (Exceeding the budget threshold doesn’t mean that the user’s access to Azure services is stopped).

The tool is not only a handy way to monitor how likely a department or project is to meet azure budget targets, but—when integrated with Azure Advisor—it can also provide optimization recommendations to help reduce Azure costs; for example, it can recommend that an underutilized VM is rightsized to a more suitable capacity. Other typical optimization recommendations include buying reserved VM instances (when appropriate) and using standard storage to store managed disks snapshots.

Limitations of the Azure budget tool

Inasmuch as the budget tool can be a great asset in some use cases, it has limitations. For example, it’ll recommend you buy reserved VM instances when utilization metrics suggest it’s the correct option, but the tool doesn’t alert you to underutilized reserved VM instances if demand changes and there are no suitable VMs of the same size within the same group and region to pick up the excess capacity. 

Furthermore, its recommendations don’t cover every resource you may be using in your Azure account. For example, the Azure Budget tool won’t recommend you upgrade to the latest generation resource when one is available, won’t recommend you terminate unused reserved IP addresses and idle load balancers, and won’t recommend you rightsize SQL servers or premium disc storage to standard.

Although these services individually may not contribute very much to the monthly bill, when you’re trying to meet Azure budget targets, every cent may count. Therefore, it’s not ideal to rely on the budget tool as your only source of information to cut costs; for, although it can help departments and projects keep within their monthly budgets, further savings can be made using other solutions.

Comprehensive optimization recommendations from CloudHealth

Compared to the Azure budget tool, CloudHealth’s cost monitoring and optimization capabilities are much more comprehensive. CloudHealth Perspectives, for example, enable businesses to delve deeper into cost trends and cost drivers from multiple angles. This capability lets businesses create unique business groups that can have many different components to reflect different sets of analysis, management, and evaluation criteria.

With regards to cost monitoring, the Azure budget tool resets at the end of each accounting period with the same budget allocated as the previous period—failing to account for seasonal variations or special events. Although you can go into the Azure portal to manually edit the periodic budget, this will edit the quarterly and annual budgets as well. With CloudHealth, you can apply twelve months budgets in advance with either unique budgets per month or percentage increases per period.

CloudHealth’s optimization recommendations are more thorough, as well. While, the Azure budget tool makes optimization recommendations based on fourteen days utilization metrics, CloudHealth users can define what period metrics they want used to ensure more accurate and precise recommendations. In order to provide an example of the difference precise recommendations can make, let’s talk about scheduling on/off times for non-production VMs.

Scheduling on/off times for non-production VMs

One of the most effective ways to reduce Azure costs and meet Azure budget targets is to schedule on/off times for non-production VMs, such as those used for development, staging, testing, and QA. Businesses that use this best practice to reduce Azure costs typically schedule start times for when the working day begins (i.e. 8:00am) and stop times for when the working day ends (i.e. 8:00pm). 

Over the course of a five day week, the VMs are running—and running up costs—for only 60 hours out of a 168 hour week. Therefore, scheduling saves businesses almost 65% on the cost of running non-production VMs; but savings can be even greater for businesses that take advantage of CloudHealth’s Smart Parking capabilities which calculate precise on/off times based on utilization metrics.

In the above image, the non-production VM is only being used for 43 hours per week; and, if a business were to schedule on/off times to correspond with when the VM is actually being used, instead of saving 65% on the cost of running non-production VMs, the business would save nearly 75%. For a General Purpose VM with 4 vCPUs and 16 GiB of memory, the difference a precise recommendation makes equates to $3.09 per week. For one VM, that’s not a lot; but, if you’re running thousands of non-production VMs, the difference can make a significant contribution towards meeting an Azure budget target.

Meet Azure budget targets more easily with CloudHealth

Whereas the Azure Budget tool can be useful in some circumstances to alert budget owners to potential overspends, it lacks the comprehensiveness and precision of CloudHealth to truly optimize Azure Cloud environments. Therefore, if you're struggling to meet Azure budget targets every month, you can use the Azure Budget tool, but you’ll likely be better off getting in touch and speaking with a member of our cloud optimization team.

Our team will further explain the differences between the Azure Budget tool and CloudHealth, elaborate on CloudHealth’s cost optimization capabilities, and organize a demo of CloudHealth in action for you to see how easy it is to meet Azure budget targets using our cloud management platform.

CloudHealth Tech Staff, Cloud Tech Journalist

The CloudHealth Tech Staff team is made up of industry experts who report on trending cloud news, offer cloud management best practices, and compare products and services across the major cloud providers. As a part of CloudHealth, the CloudHealth Tech Staff come from all different backgrounds making them unique leaders in this industry.

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