Budget, Alert, & Save with Cost Management

Azure Cost Management

Managing cloud costs efficiently is crucial for nonprofits striving to maximize their impact while staying within budget. Azure Cost Management offers a suite of tools designed to help organizations monitor, allocate, and optimize their cloud spending. This blog post will guide you through the navigation of Azure Cost Management and share best practices to ensure your nonprofit can make the most of its cloud investment.

Azure Cost Management is integrated into the Azure portal, providing a seamless experience for users. Here’s a step-by-step walkthrough to help you get started:

Accessing Cost Management:

Located in the Cost management menu tab. You will see options to manage your billing, cost analysis, cost alerts, budgets, and advisor recommendations. Use the directions below to navigate the Azure portal and begin learning how you can create your first budget.

Cost Management + Billing

1. 1. Log in to the Azure portal.
   2. Navigate to the "Cost Management + Billing" section.
   3. If you do not see the option in your home directory, you can type "Cost Managment + Billing" in the top search bar.
   4. Here, you can view your cost data at various scope levels, such as billing account, billing profile, and invoice section.

Features 

1. Cost Analysis: Use the "Cost Analysis" feature to visualize your spending. You can categorize costs by resource group, service, location, or tag, and create custom filters to focus on the data that matters most to your organization.
2. Budgets and Alerts: Set up budgets to monitor your cloud spending. Specify a time period, amount, and alert threshold for your budget. Azure will notify you when your spending approaches or exceeds the set limits.
3. Cost Allocation: Distribute your cloud costs across different projects or departments within your nonprofit. Use tags to categorize resources and create cost allocation rules to split or move costs between them.
4. Exports and Reports: Create custom reports and export cost data for in-depth analysis. This feature allows you to integrate cost data with other business systems to gain greater insight into your spending patterns.

qqImage of woman looking through a telescope into the distance by Ricky Esquivel from Pexels.

Defining Your Scope

Disclaimer: Before you begin to create a budget there are some prerequisites to consider. You will need the appropriate access to your Azure Account. If you are not a Role Based Access Control (RBAC) role of owner or contributor or Billing administrator, you will not be able to create a budget. 

Billing Scopes are tied to the structure of your Azure Account Billing. The scope can be defined by the following:

• Resource Group: A container for resources that are related or deployed together for a given workload.
• Subscription: It looks at all resources, resource groups, and related services and are the primary container for Azure.
• Management Group: A hierarchal container the houses subscriptions with six levels of depth. 

No matter the scope level you choose. Different scenarios will matter on your particular use case. Large organizations may have multiple regions and need to use management groups for organizational level hierarchical adoption of policies, billing for each department, and performing cost analysis to see performance across regions.

Management groups can only have one parent per management group. However, each parent can have many children. It is also important to note that policies are adopted from the top down, which means the children will adopt the policy. Small to medium businesses can use Management groups as well. However, they may be able to get away with a few subscriptions for their needs. A common workflow being, Development and Production. 

Select Scope for the Budget

Image of Azure cost management cost analysis screen in Azure portal.

1. Navigate to Azure Portal.
2. In the top search bar, type "Cost Management."
3. In the left-hand menu "Cost Analysis" tab located at the top of the menu is the Scope. You can select the change button to change the scope (You can also select the scope in the Overview menu as well).
4. Select the Scope where the budget will apply:
   • Management Group: Budget at the organization level.
   • Subscription: Budget for an entire Azure subscription.
   • Resource Group: Budget for a specific group of resources.
5. Then click the "Select" button.

Congratulations! You are on your way to optimizing your costs by selecting the appropriate scope for your budget. Now, let's proceed to set up your budget. If you decide to change the scope, such as selecting a different resource group, you can easily do so during the budget creation process. Let's move forward and create your budget to ensure efficient financial management and cost optimization.

Define Budget Settings

Image of Budge creation for Cost Management in Azure Portal.

1. Log into the Azure Portal.
2. In the top search bar type "Cost Management."
3. In the left-hand menu select the "Monitoring" >"Budgets."
4. in the "Budgets" menu, click the "Add" button located at the top of the menu.
5. In the "Budget scoping" area you can select the scope by clicking on "change." You can also add filters to the scope. Examples like product, frequency, etc.
6. In the "Budget Details" section Enter a Budget Name (e.g., "Monthly Dev Budget").
7. Choose Reset Period:
   • Monthly
   • Quarterly
   • Annually
8. Set Start and Expiry Date:
   • Choose when the budget should start.
   • Set an optional end date.
9. Enter Budget Amount:
   • Define the cost threshold for the budget (e.g., $10,000 per quarter).
10. Click "Next."

After you click next you will setup the alerts to notify the admins of the alerts. Do not click create until you specified who will be alerted in this step.

Set Up Alerts & Notifications

Image of creating an alert for the budget in Cost management within Azure portal.

1. Under Alert condition, select the condition "Actual" or "Forecasted."
2. Define Threshold Percentage:
   • Example: 50%, 75%, and 90% of the budget.
3. Select Alert Type:
   • Actual Cost: Alerts trigger when the actual cost reaches the threshold.
   • Forecasted Cost: Alerts trigger based on projected spending.
4. Choose Notification Methods:
   • Enter email addresses of recipients.
   • Optionally, select an Action Group to automate responses (e.g., Power Automate or Logic Apps).
5. Click "Create."

Best Practices for Azure Cost Management

To make the most of Azure Cost Management, consider implementing the following best practices:

1. Tagging Resources: Ensure all your cloud resources are properly tagged. This practice helps in organizing and tracking costs more effectively. Use Azure Policy to enforce tagging policies and audit compliance.
2. Utilizing Azure Advisor: Leverage Azure Advisor for personalized recommendations on cost optimization. It provides actionable insights to help you reduce costs, improve performance, and enhance security.
3. Setting Up Budgets and Alerts: Regularly review and adjust your budgets based on your organization's needs. Use alerts to stay informed about spending anomalies and take corrective actions promptly.
4. Optimizing Resource Usage: Identify underutilized resources and consider resizing or shutting them down. Use Azure's autoscaling features to match resource allocation with demand, ensuring cost efficiency.
5. Regular Cost Reviews: Conduct regular reviews of your cloud spending. Analyze cost trends, identify areas for improvement, and implement cost-saving measures. Engage with your finance and IT teams to ensure alignment on cost management goals.

Conclusion

By effectively leveraging Azure Cost Management, nonprofits can achieve superior control over their cloud spending, ensuring that more resources are dedicated to their mission. Implementing these best practices will empower your organization to optimize costs, enhance efficiency, and achieve a greater impact. Now, you can begin by creating budgets and setting up alerts to keep the right team members informed and ensure you stay within your budget scope. For further details, please refer to the documentation.

Hyperlinks

• Tutorial - Create and manage budgets - Microsoft Cost Management | Microsoft Learn
• Understand and work with Cost Management scopes - Microsoft Cost Management | Microsoft Learn
• Optimize your cloud investment with Cost Management - Microsoft Cost Management | Microsoft Learn