Why Right-Sizing AWS Instances Is An Effective Cost Optimization Strategy

Right-Sizing AWS Instances Effective Cost Strategy

When choosing cloud resources, it’s a best practice to estimate the resources you need. Right-sizing helps AWS deploy the correct capacity of instances at a customer-friendly cost. 

Right-size when starting with the cloud. People who choose Reserved Instances have to estimate resources they’ll need and commit to paying a given amount for those resources. If you commit to staying with AWS for a long time, you’ll get a higher discount. These discounts can be a significant cost-saving hack. 

Right-Sizing and Cost-Optimization

As you can see, right-sizing ensures users have the capacity they need. It has two-fold benefits. The direct benefit? It helps to save on the cost of running unnecessary EC2 instances. The other benefit is this: Underestimated resources will lead to low performance. Low performance leads to unproductive time. AWS users could be paying for lagging resources, which yield a low output for every input. 

Why Is Right-Sizing an Effective Cost-Optimization Strategy?

Right-sizing AWS instances is effective for the following reasons:

Resource Optimization

Right-sizing helps in being efficient. Efficiency is an essential part of popular cybersecurity controls. Cloud users want nothing more than the right resources giving an excellent performance at an affordable cost. And if you can use every cloud resource to the maximum, chances are, you’ll channel all savings to other areas that need financing. Right-sizing allows better use of the cloud, which helps meet your organization’s goals. 

Right-sizing also keeps the AWS infrastructure optimized. Even though AWS has vast amounts of capacity, it’s always looking for ways to sell most of its space on virtual servers. Terminated assets can help serve another AWS user. AWS will integrate such savings into greater discounts to attract more users.

Increase in Profits

According to AWS, right-sizing leads to significant cost savings. An organization that right-sizes continually is likely to pay 36 percent less than the one running unoptimized instances. Each cost saved directly adds to an organization’s profit because the organization usually subtracts costs from revenue to get profit. 

If you right-size by downgrading EC2 resources, you cut on costs. However, right-sizing isn’t an easy task. Cloud engineers have to do a cost-benefit analysis to ensure that their right-sizing operations have a significant benefit. If the benefit is too minuscule, there’s no need to right-size. For example, a small company may have minimal EC2 allocation. For this company, right-sizing may include paying for separate tools, which may be more expensive than the expected returns. Therefore, small startups and those still in the test phase shouldn’t right-size. But when scaling, it’s important to start optimization. In the early stages, keep studying your cloud usage reports to help estimate the right resources at a later stage. 

Focus on Performance and Costs

Most organizations have a performance-driven philosophy. You can win the SaaS game by balancing both performance and costs. Even though performance is important, organizations should pay equal importance to costs. Because right-sizing isn’t a one-time process, companies that right-size make it their business philosophies. These philosophies often materialize, especially when you cut costs continually. 

The Bottom Line

nOps is a cloud cost management tool. With nOps on board, you can visualize cloud usage, performance, and right-size instances in few easy steps. The tool uses machine learning technology to study historical usage. From past usage, it can offer recommendations on right-sizing. In addition, nOps pays close attention to different ways an organization can right-size. Some features help you turn off zombie assets, and others help allocate the right instance resource.