This year, 89% of organizations are using multiple cloud services for IT, and 73% are using hybrid cloud, a combination of both cloud-based and on-premises IT, according to Flexera.
K–12 schools are no exception, as some 35% have a cloud initiative in the works, according to a 2024 CoSN survey. Many use a hybrid combination of internal and cloud-based systems to deliver an array of IT services that range from the student information system, HR and other administrative functions to the delivery of online content for both classroom teaching and remote learning.
As cloud computing continues to open up educational possibilities, schools are flocking to it. But how do IT leaders manage cloud costs as they move more of their functions to the cloud?
A majority (58%) of organizations feel that their cloud costs are too high, and 82% have doubts about how well they are managing their cloud spending.
In education, as in other industries, managing cloud costs is a key objective that often boils down to cost reduction, cost optimization and cost control.
Click to learn how infrastructure modernization could benefit K–12 schools.
Cost Reduction Starts with Anticipating Cost Increases
The first step in reducing costs requires doing the opposite: You must ascertain where costs will increase when you move to the cloud. This might sound counterintuitive, but I’ve seen cost reduction efforts fall flat in organizations when this isn’t done up front.
Here’s how it happens: An organization wants to move IT to the cloud to save money. Then, it finds out that it can’t begin to think about a cloud move without increasing network and internet bandwidth and without procuring additional security services for the cloud, such as secure access service edge.
The best practice for addressing this is for the school’s IT leader to present these transitional costs up front to budget decision-makers and bake these new costs into the total cloud budget. This new budget number then becomes the baseline against which cost reductions are measured.
Once you have a total cloud cost picture, you can pursue opportunities for cost reductions. There are a few key areas where you will be able to find them.
Look into user subscriptions. As more educators, students and staff use cloud-based resources, they will independently budget for these without IT’s knowledge. This is especially true for Software as a Service offerings that were previously delivered to end users via download but are now delivered through the cloud.
Often, there are more cloud services in use than IT planned for. In some cases, these resources are underused or redundant. This is an area that IT should audit to eliminate service duplications or dormancy.
Similar auditing and tracking should be done to highlight cloud storage and processing that is going unused. This usually happens when resources are provisioned and then left in an active state because someone forgot to deprovision them after use. As a result, the school keeps paying for them, even though they sit idle.
Finally, you might have cloud providers that provide the same service, or there might be excess or obsolete data stored and paid for in the cloud that should be purged.
These are all areas where IT can tighten up its cloud use, with a goal of paying only for cloud services that are actively being used.
DIG DEEPER: How to sustain IT upgrades after the ESSER funding cliff.
Find Opportunities for Cost Optimization
The beauty of the cloud is that, if you manage it well, you pay only for what you use. You eliminate dormant assets such as in-house processing and storage that you’ve amortized as capital investments.
“Eliminating redundant infrastructure is key to reducing costs,” says Paige Johnson, vice president of education marketing at Microsoft. “You can also use existing license agreements and long-term vendor relationships that can result in cost savings.”
Equally important is training IT staff on the resource management tools that each cloud provider furnishes.
“Investing in cloud training for IT personnel ensures that companies can better manage and optimize cloud environments without hiring new staff,” Johnson says. “This helps in retaining institutional knowledge while expanding cloud expertise.”
The cloud tools available to IT staff include solutions for monitoring cloud use, security, uptime and throughput. The same tools help IT to fine-tune applications for optimal performance at the lowest cost.
RELATED: With security staff scarce in K–12, schools turn to cloud-based labor, tools and skill sets.
Regain Cost Control
Some years ago, when I was a CIO, we had difficulty understanding our telecommunications bills, but we knew they were too high. The problem was the complexity of the bills. There were billing category acronyms we couldn’t decipher and peculiar ways of adding up costs, making it impossible for us to fully understand and discuss these bills with vendors. We brought in a telecommunications bill auditor to go through the charges, explain how we were being billed and identify surplus costs. We got to the bottom of the bills and saved ourselves a bundle.
Cloud bills can be equally complicated, which is why many cloud providers offer cost analysis tools. Mastering and using these tools is a task for both IT leaders and finance department cost analysts. You should contact your vendors when questions arise.
By gaining a comprehensive understanding of your cloud cost picture, you can identify and eliminate surplus cloud costs and ensure that the cloud services you are paying for align with your organization’s business goals.
Optimizing and controlling cloud costs and seeking reductions when cloud resources go unused should be central areas of focus for CIOs and CFOs because as IT moves to the cloud, so will IT costs.
