05/06/24 | EverOps
With business and technology evolving at an unprecedented rate, today’s organizations must look beyond traditional cost-cutting measures to stay ahead of their competitors. According to a recent Gartner study, 75% of businesses will have implemented a cost- and stakeholder-driven data center infrastructure sustainability program by 2027, underscoring the growing need for effective cost-optimization initiatives.
One area where cost optimization is particularly crucial is cloud computing. With organizations running half their workloads in the public cloud and maintaining complex IT infrastructures, cloud computing has become more expensive than anticipated. In fact, worldwide end-user spending on public cloud services is forecast to grow by 20.4% to $678.8 billion in 2024, up from $563.6 billion in 2023. To address this, companies such as EverOps have emerged, offering specialized services to help organizations navigate the complexities of cloud computing costs and achieve long-term financial sustainability.
This article aims to uncover some of the most common and uncommon culprits of inefficiencies found within organizations now, providing insights into how EverOps has successfully turned these inefficiencies into significant cost savings for clients. By proactively recognizing and tackling these inefficiencies early on, companies can begin to maximize ROI’s and optimize resources for future growth.
Cost optimization is the process of identifying and eliminating inefficiencies within an organization to reduce costs and improve overall performance. It is essential for organizations because it helps them maintain a competitive edge, increase profitability, and ensure long-term success.
Some common areas of inefficiencies may include over-provisioned resources, legacy systems, manual processes, underutilized software licenses, ineffective collaboration, and a lack of skills or training. However, these are just a few of the inefficiencies EverOps has uncovered when working with clients. There are many other potential inefficiencies that may be less obvious within organizations that can significantly impact their overall performance and success.
Some less obvious inefficiency traps may include underutilized talent, inadequate data governance, and a lack of innovation and continuous improvement. However, inefficiencies can oftentimes lurk in less obvious areas of organizations, so it is important to examine all areas of your business in an effort to uncover them and better optimize for the future.
Organizations can identify inefficiencies in various ways, such as conducting a comprehensive audit of their IT infrastructure, examining current operational processes in depth, or hiring a partner to help aid in finding and optimizing inefficiencies that might not have been as easily uncovered otherwise. Leveraging data analytics and monitoring tools can also help uncover inefficiencies in real-time.
Partnering with a cost optimization expert like EverOps can provide organizations with the expertise, tools, and strategies needed to identify and address inefficiencies effectively. EverOps has a proven track record of helping clients achieve significant cost savings and improve operational efficiency through customized solutions and a collaborative approach.
Life360, Peloton Interactive, Inc., and Zendesk are all examples of organizations that have successfully partnered with EverOps to achieve significant cost savings and operational improvements through targeted cost optimization strategies.
The long-term benefits of implementing a comprehensive cost optimization strategy include increased profitability, improved operational efficiency, enhanced agility, and better positioning for future growth and success.
Despite the fact that businesses might be running and maintaining a bustling institution with teams working diligently to achieve their goals, hidden inefficiencies may still lurk beneath the surface, slowly eroding the company’s potential for success. These inefficiencies come in many forms, silently siphoning resources, driving up costs, and hampering productivity.
However, by understanding these common culprits, companies can be empowered to take proactive steps towards optimizing internal operations and achieving long-term cost savings. Here are 6 examples of common inefficiencies typically found within organizations today.
After exploring the common and uncommon culprits of inefficiencies within organizations, it’s clear that identifying and addressing these issues is crucial for driving cost optimization and improving overall business performance. However, knowing where to start and how to effectively tackle these inefficiencies can be a daunting task for many organizations.
Fortunately, the success stories of companies like Life360, Peloton Interactive, Inc., and Zendesk serve as powerful examples of how partnering with the right cost optimization expert can make all the difference. By working with EverOps, these organizations could identify and eliminate inefficiencies, achieve significant cost savings, and lay the foundation for long-term operational excellence.
In the following case studies, we will examine how EverOps tailored its approach to meet each client’s unique needs and challenges, demonstrating the value of a customized and collaborative partnership when optimizing for cost optimization purposes. These real-world examples offer valuable insights and inspiration for other organizations looking to embark on their cost optimization journey and achieve similar successes.
Life360, a leading provider of digital safety solutions, faced a significant challenge in its pursuit of cost optimization and engineering excellence. The company’s infrastructure demands were exceptionally high, with over 20 billion requests daily across multiple services. EverOps partnered with Life360, offering a unique operating model and a customized solution that could handle this scale while ensuring zero-defect delivery.
By collaborating with Life360 FinOps leaders and implementing two concurrent initiatives—optimization of AWS EC2 Auto-Scaling Groups and implementation of AWS VPC Endpoints for DynamoDB and S3—EverOps helped Life360 achieve $1.7M in annual cloud cost savings and anticipate efficiency gains equivalent to up to 70 full-time employees.
Peloton Interactive, Inc., an industry leader in exercise equipment and media, sought to reduce costs through infrastructure improvements without negatively impacting their developer teams. EverOps worked with Peloton to analyze their existing infrastructure and create a solution roadmap that included reducing instance sizes based on utilization, migrating to EC2 Graviton for performance improvements, and building executive spend dashboards for real-time data visibility.
Within four weeks, EverOps helped Peloton reduce its infrastructure spending by $400K annually, increase developer efficiency by migrating from Chef to Ansible, and establish a repeatable cost-reduction process for its infrastructure needs.
Zendesk, a cloud-based industry leader in help desk management solutions, had a rapidly growing infrastructure that resulted in high monthly costs due to long-running instances and related licensing. EverOps and Zendesk engineers worked together to look at how much they spent on infrastructure and licensing for 2,500 EC2 instances. These teams devised a solution roadmap that included moving to an immutable AMI procurement workflow, automating instance recycling, using the latest OS to get rid of ESM licenses, and deploying instances behind an ASG for dynamic scaling.
As a result, Zendesk achieved a 70% reduction in infrastructure compute costs, reduced licensing costs and dependencies, and increased engineering efficiency by reducing instance procurement times.
Cost optimization has emerged as a critical strategy for organizations seeking to maintain a competitive edge and ensure long-term success today. As the pressure to improve efficiency and reduce costs continues to mount, it has become increasingly clear that a comprehensive approach to cost optimization is not just an option but a necessity.
By shedding light on the common culprits of inefficiencies, such as over-provisioned resources and manual processes, to the less obvious but equally impactful inefficiency traps, like underutilized talent and inadequate data governance, we’ve emphasized the importance of a holistic approach to cost optimization that goes beyond simple cost-cutting measures.
As organizations embark on their own cost optimization journey, embracing a culture of continuous improvement, investing in the right strategies, and leveraging the expertise of experienced professionals will be key to unlocking the full potential of cost optimization and ensuring a thriving future.
If you or you’re organization is interested in implementing effective cost optimization strategies, partnering with EverOps may be the differentiating factor between a profitable company and a thriving one. With a proven track record of success, deep expertise in identifying and addressing inefficiencies, and a commitment to delivering customized solutions, EverOps is the ideal partner to help you navigate the complexities of cost optimization.
By working with EverOps, organizations will have the opportunity to tap into an extensive wealth of knowledge while leveraging cutting-edge tools and strategies and benefiting from a customized and collaborative approach to driving long-term success. So, don’t let inefficiencies hold your organization back any longer. Take the first step towards a more efficient and profitable future by partnering with EverOps today!