Cloud adoption continues to rise, but so does cloud spend. Many organisations now face spiralling costs from underutilised resources, oversized compute, unnecessary storage, and poorly governed environments.
Cloud cost optimisation — also known as FinOps — provides the practices needed to control spend, improve efficiency, and ensure every pound delivers business value.

This article outlines practical steps organisations can take to reduce cloud costs without compromising performance or reliability.

Most cloud waste comes from over-provisioning, idle resources, and poor visibility — fixing these three areas often reduces costs by 20–40% immediately.

1. Understand Where Your Cloud Spend Is Going

Cost optimisation begins with visibility.

✔ Tagging and labelling

Consistent tags allow you to track spend by:

• team
• project
• environment
• application
• cost centre

✔ Use cloud-native dashboards

Tools like:

• AWS Cost Explorer
• Azure Cost Management
• Google Cloud Billing

help you identify trends, anomalies, and opportunities to save.

✔ Identify unused or idle resources

Common issues:

• unattached disks
• idle Kubernetes nodes
• unused IPs
• over-provisioned VMs
• dormant test environments

Cleaning these up provides instant savings.

2. Rightsize Compute and Storage Resources

Many workloads run on oversized compute instances because initial estimates were too high.

✔ Analyse real resource usage

Use CPU, memory, and I/O metrics to adjust VM or container sizes.

✔ Use autoscaling

Autoscaling ensures you scale up during demand and scale down when traffic drops.

✔ Choose appropriate storage tiers

Move infrequently accessed data to:

• S3 Infrequent Access
• Azure Cool/Archive
• Nearline storage in GCP

This can reduce storage cost significantly.

3. Optimise Kubernetes and Container Workloads

Kubernetes environments often accumulate hidden costs.

✔ Rightsize pod requests & limits

Avoid giving containers more CPU/memory than needed.

✔ Use cluster autoscaling

Automatically add/remove nodes based on workload.

✔ Remove orphaned PVCs and unused persistent volumes

These frequently remain after workloads are deleted.

✔ Tune node pools

Using the right mix of on-demand, spot, or reserved instances reduces compute cost.

4. Choose the Right Pricing Model

Cloud providers offer multiple pricing options. Choosing the right one makes a huge difference.

✔ Pay-as-you-go

Flexible but not always cost-efficient for steady workloads.

✔ Reserved Instances (AWS/Azure)

Discounts of 30–70% for long-term commitments (1 or 3 years).

✔ Savings Plans (AWS)

Flexible commitment with strong discounts.

✔ Spot instances

Great for non-critical or interruptible workloads — very low cost.

✔ Serverless

Only pay for usage, ideal for event-driven or sporadic workloads.

The right model depends on your workload stability and business predictability.

5. Automate Cost Controls

Automation helps ensure cost discipline.

✔ Use policies to prevent over-provisioning

Examples:

• enforce VM size limits
• restrict expensive GPU instances
• prevent provision of large storage by mistake

✔ Set budget alerts

Notify teams before exceeding thresholds.

✔ Automatically shut down unused environments

Common for:

• dev
• test
• temporary sandboxes

Automation ensures resources don’t run longer than necessary.

6. Implement a FinOps Culture

Cost optimisation is not just a technical challenge — it requires collaboration.

✔ Shared responsibility

Engineering, finance, and product teams must understand cloud costs.

✔ Cost accountability

Teams should own their own cloud budgets.

✔ Regular reviews

Monthly or quarterly reviews help identify trends early.

✔ Clear governance

Policies ensure resources are provisioned consistently and responsibly.

A strong FinOps culture leads to sustained cost savings.

7. Monitor and Continuously Improve

Cloud cost optimisation is not a one-time activity.

✔ Use monitoring tools

Cloud-native and third-party tools provide deeper insights:

• Azure Advisor
• AWS Trusted Advisor
• GCP Recommender
• Datadog
• CloudHealth

✔ Detect anomalies

Unexpected spikes can indicate:

• misconfigurations
• runaway processes
• unplanned scale-outs

✔ Regular optimisation cycles

Review, correct, improve, and repeat.

Continuous improvement keeps costs predictable and efficient.

Conclusion

Cloud cost optimisation is essential for modern organisations operating at scale. By improving visibility, rightsizing resources, tuning Kubernetes environments, selecting the right pricing models, and embedding a FinOps mindset, businesses can significantly reduce cloud spend — without compromising performance.

With the right strategy and practices in place, cloud platforms become more efficient, predictable, and aligned with business goals. Cost optimisation is not about cutting corners — it’s about ensuring your cloud investment delivers maximum value.