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Almost half of businesses struggle to control cloud costs

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A pile of Sterling notes.


Duncan is an award-winning editor with more than 20 years experience in journalism. Having launched his tech journalism career as editor of Arabian Computer News in Dubai, he has since edited an array of tech and digital marketing publications, including Computer Business Review, TechWeekEurope, Figaro Digital, Digit and Marketing Gazette.


Nearly half of businesses (49%) find it difficult to get cloud costs under control, and 54% believe their primary source of cloud waste is a lack of visibility into cloud usage.

This is according to a new report published today by business monitoring company Anodot. The findings highlight an ongoing visibility crisis in which organisations are struggling to gain appropriate insights into the breakdown of cloud costs and efficiency of cloud use and therefore cannot effectively reduce wasted spend – even as cloud migration continues to rise and cutting costs is a priority. The report is based on a survey of 131 US-based IT directors and executives.

Anodot’s 2021 State of Cloud Cost Report revealed that the pandemic greatly accelerated many companies’ shift to the cloud, and the latest survey confirms that the transition is continuing as businesses continue to appreciate the agility and scalability the cloud provides: 91% of respondents reported they currently have IT infrastructure in the cloud; 60% said that migrating more workloads to the cloud is their top cloud initiative in the coming year. As enterprises continue to face high monthly cloud bills – with cloud costs ranking second only to payroll in terms of business expenses for many – visualising costs, optimising spend and reducing wasted dollars are top priorities, especially in the wake of a slowing economy.

A significant portion of these inflated cloud bills could have been avoided: 44% of respondents said that at least one-third (33%) of their cloud spend is wasted each year. Visibility is the main culprit: the majority of executives surveyed (53%) said gaining visibility into cloud usage and costs is their top challenge for controlling spend and reducing waste; one-fifth (19%) said they lack the ability to manage their cloud budget due to insufficient visibility into cloud usage. Cloud costs are also becoming increasingly complex to track and understand, also leading to misspending: 46% of executives reported that overprovisioning is a primary source of cloud waste, while 45% blamed cloud assets’ fragmentation across teams and vendors.

David Drai, Anodot CEO and co-founder, said: “Shifting to the cloud requires a delicate balance between the speed of workload migration and cost control.

“Today, cloud cost management – which is all the more crucial as businesses strive to mitigate wasted resources and shore up revenues – should be based on four key elements: visibility, insights, recommendations, and automated actions. Enterprises that are leveraging AI and ML to control and optimise their cloud environments are seeing immediate results and reduced waste, unlocking the true value the cloud has always promised.”

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Additional findings:
● Surprise, Surprise: Over a third of participants (37%) have been surprised by their cloud costs or had an incident related to cloud costs.
● Growing Complexity: When asked to choose the top challenges in controlling cloud costs, 53% said the key challenge is gaining true visibility into cloud usage and costs; 50% said complex cloud pricing; 49% said complex, multi-cloud environments.*
● Unnoticed Spikes: 28% of respondents said it takes weeks or months to notice a spike in cloud costs – no improvement in the average time to detect incidents since 2021.

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TECHNOLOGY

Changing Tides at NAMIC

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Changing Tides at NAMIC


What a hot and lively week in Dallas! 98F and a huge crowd at the 127th National Association of Mutual Insurance Companies (NAMIC).

Over 1000 senior insurance executives, board members, and service partners, represented 400+ property and casualty insurance and related companies. NAIC officers discussed the insurance trends, regulatory challenges, and barriers to competitive markets. 45 speakers held economy power sessions and education sessions sharing thought leadership on the biggest industry challenges and opportunities. 

I had the honor to address the hottest topic – “The Future of Work” – at NAMIC. My session began with a live poll on the top 3 most common reasons given for employees quitting jobs. Here are the most voted reasons among the 181 votes: Lack of workplace flexibility, inadequate compensation, unmeaningful work, and lack of career development.

Here are the results in percentages:

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In 2021, 47 million Americans quit their jobs and entered the era of the great resignation. Since January of 2022, over 4 million Americans quit each month. To understand why, McKinsey surveyed 13000 employees in 6 countries from April 21 to April 22. The top reasons for people quitting jobs were lack of career development/advancement, inadequate compensation, uninspiring leaders, and lack of meaningful work. Below is a chart with more details.

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The live audience poll and McKinsey’s survey both ranked meaningful work, career growth, and compensation as top reasons for quitting, followed by uninspiring leadership and lack of workforce flexibility.

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Moreover, the future workforce demographic is changing from baby boomers to millennials and Gen Z. According to Pew Research, by 2050, 75% of the workforce is expected to be made up of millennials. 44% of millennials say they are more likely to be engaged when their managers hold regular meetings with them. Currently, only 21% meet with their manager on a weekly basis. Gen Z has surpassed millennials as the largest generation, making up 12% of the workforce. 22% of Gen Zs currently have at least one immigrant parent. By 2026, Gen Z will become the largest non-white generation. For Gen Z, community, diversity, and inclusion as well as their sense of passion and purpose hold utmost importance.

My speech covered three main topics: talent management including upskilling, transitioning to a hybrid environment, and outlook for the next 10 years. Registered attendees can get access to the recording through the end of 2022.

During the Q&A, the youngest attendee urged us to look around and notice that there were not enough young people at NAMIC. He called out the importance of understanding the younger generation and giving them more opportunities to network with decision makers at events like NAMIC. That perfectly summed up my presentation. Though NAMIC has certainly evolved with more women representation (15 this year out of 45 speakers and a few CEOs), there is still a need for more diversity in demographic and thought.

I was delighted to reconnect with former colleges, a few CEOs and board members of the mutual insurance companies at NAMIC. My favourite part of NAMIC is that it always feels like a family fair. It is a place we can share best practices and support each other even though our businesses may compete. Where else can you find such an ecosystem?



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