Add organization information to cost and usage

Establishing a structured tagging schema is critical for effectively monitoring costs and usage. By implementing consistent tagging that reflects your organization, workload attributes, and cost allocation categories, you can achieve granular visibility into resource usage and associated costs.

Best Practices

Implement a Comprehensive Tagging Strategy

• Define a clear tagging schema that includes key attributes such as project name, owner, environment (e.g., production, development), and cost center. This helps in organizing and tracking resources effectively.
• Ensure that all teams understand the importance of tagging for cost allocation and monitoring. Provide training on how to apply tags consistently across all resources.
• Use AWS Resource Groups and AWS Cost Allocation Tags to automate and streamline cost tracking processes. This enables better monitoring and reporting on cost and usage metrics.
• Regularly review and audit tags to ensure compliance with your tagging policy. Update any inconsistencies or missing tags promptly to maintain accurate cost tracking.
• Leverage AWS Budgets and Cost Explorer alongside your tagging strategy to analyze spending patterns and identify optimization opportunities based on tagged resources.

Establish Governance for Tagging Compliance

• Create a governance framework that includes processes for tagging resources upon creation. This can involve approvals or checking compliance before launching new resources.
• Implement automation tools (e.g., AWS Lambda functions) that can enforce tagging policies by preventing resource creation until proper tags are applied.
• Incorporate tagging compliance checks into regular cloud management processes, ensuring that teams are held accountable for their tagging practices.
• Encourage a culture of cost awareness among teams by making tagging compliance part of performance metrics and evaluations.

Analyze Costs by Organization Attributes

• Utilize the tags you have implemented to filter and categorize cost reports in the AWS Cost Explorer. This enables visibility into how different teams or projects are impacting overall expenditures.
• Set up dashboards that visualize costs associated with specific tags, helping management and financial teams easily identify areas for cost reduction or efficiency improvements.
• Periodically review cost allocation insights with stakeholders to discuss potential reallocation of resources or budget adjustments based on the data gathered through your tagging efforts.

Questions to ask your team

• Have you defined a tagging schema that includes key attributes relevant to your organization?
• Are all resources consistently tagged according to their purpose, team, and environment?
• How often do you review and update your tagging strategy to align with organizational changes?
• Do you use the AWS Cost Explorer to analyze costs based on your tagging schema?
• Is there a process in place to ensure compliance with the tagging policy across new resources?

Who should be doing this?

Cloud Financial Manager

• Establish and maintain the tagging schema for resources.
• Oversee cost allocation policies and ensure compliance across teams.
• Monitor and analyze cost and usage reports to identify trends and areas for improvement.
• Collaborate with teams to ensure consistency in tagging and resource categorization.
• Provide training and guidance on best practices for cost monitoring and optimization.

DevOps Engineer

• Implement tagging schemes on new and existing resources based on organizational standards.
• Ensure automated scripts and CI/CD pipelines incorporate proper tagging practices.
• Coordinate with the Cloud Financial Manager to align on tagging strategies.

Finance Analyst

• Analyze cost and usage data to report on financial performance.
• Identify discrepancies and ensure accurate allocation of costs based on established tags.
• Provide insights and recommendations for cost optimization initiatives.

Team Lead/Manager

• Ensure team members understand and implement tagging policies.
• Review resource usage periodically to assess compliance with cost monitoring practices.
• Encourage a culture of cost awareness within the team.

What evidence shows this is happening in your organization?

• Tagging Policy Template: A comprehensive document that outlines the tagging schema defined by the organization, including mandatory tags for workload attributes and cost allocation categories. This policy ensures consistent implementation across all AWS resources.
• Cost Allocation Report: A report that details the organization’s costs segmented by tags implemented across resources, helping stakeholders visualize and analyze cost distribution effectively.
• Cost Monitoring Dashboard: An interactive dashboard built using AWS Cost Explorer and QuickSight that visualizes cost and usage data based on tags, allowing teams to drill down and filter costs by various criteria such as purpose, team, or environment.
• Cost Optimization Checklist: A checklist designed for operational teams to ensure that all new AWS resources are tagged according to the established schema. This checklist promotes adherence to cost monitoring practices.
• Tagging Strategy Guide: A detailed guide that outlines best practices for developing a tagging strategy in AWS, including examples of effective tag structures and recommendations on how to manage tags over time.

Cloud Services

AWS

• AWS Cost Explorer: Allows you to visualize, understand, and manage your AWS costs and usage over time, and helps you identify cost trends and recommendations.
• AWS Budgets: Enables you to set custom cost and usage budgets that alert you when your costs or usage exceed specified thresholds.
• AWS CloudTrail: Tracks user activity and API usage to help you understand how resources are being used and ensure compliance with your tagging policies.
• AWS Resource Groups: Allows you to group resources based on tags, making it easier to see costs by organization or purpose.
• AWS Tag Editor: Enables you to manage and create tags for your AWS resources in bulk, ensuring consistent tagging across your organization.

Azure

• Azure Cost Management + Billing: Helps you monitor, allocate, and optimize your cloud spending with real-time insights into your usage and costs.
• Azure Advisor: Provides personalized best practices to optimize your Azure resources, including cost management recommendations.
• Azure Resource Manager: Enables you to deploy and manage Azure resources with consistent tagging and organization, facilitating better cost tracking.

Google Cloud Platform

• Google Cloud Billing: Allows you to manage your costs and usage, and provides insights for tracking and optimizing the billing process.
• Google Cloud Resource Manager: Helps you organize and manage resources with labels, making it easier to allocate and analyze costs based on your organizational structure.
• BigQuery: Provides powerful analysis capabilities for your billing data, allowing you to perform deep insights into your cloud spending.

Question: How do you monitor your cost and usage?
Pillar: Cost Optimization (Code: COST)