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“We were looking for functional capabilities and a rock-solid product where we know there’s less risk, We also have a great collaboration with IBM. These are more or less the main drivers for choosing IBM Cloudability.”
Siemens, a global technology leader, faced mounting challenges managing rapidly growing public cloud infrastructure. With roughly 5,000 cloud accounts and spending increasing 30% a year, the company needed robust capabilities to optimize costs while delivering the cloud services the business demanded.
By adopting IBM Cloudability, Siemens centralized cloud cost management in a single pane of glass view, giving business unit leaders and service owners the information they needed to make data-driven decisions that optimized spend while delivering critical products and services to the market.
Siemens AG is a global technology conglomerate founded in Berlin, Germany, in 1847. With over 318,000 employees, the company operates in nearly all countries of the world, focusing on the areas of automation and digitalization in the process and manufacturing industries, intelligent infrastructure for buildings and distributed energy systems, smart mobility solutions for rail transport, and medical technology and digital healthcare services. Siemens is the global market leader in industrial automation and industrial software.
The corporate IT organization provides overarching technology platforms and services to the entire Siemens enterprise. Within corporate IT, the IoT and Platform Services function oversees global IT infrastructure, including data centers, cloud platforms, and security. This organization manages Siemens’ relationships with major cloud hyperscalers—AWS, Azure, Google Cloud, and Alibaba—providing cloud services both for internal business needs and external customer solutions.
Siemens’ cloud journey had reached a critical inflection point. “For the last five years, cloud spend has increased 30% annually,” said Stefan Kandlbinder, VP, Global Head of IT Finance for Digital Foundation and IoT and Platform Services at Siemens.
This growth wasn’t inherently problematic. Much of it represented positive business expansion. Distinguishing productive growth from inefficiency, however, had become increasingly difficult. And Siemens’ existing cloud cost management tool, for functional and for financial reasons, no longer satisfied the company’s requirements.
With approximately 7,000 cloud accounts spanning multiple hyperscalers and business units, Siemens needed a better solution to understand consumption patterns, identify optimization opportunities, and forecast spending.
To address this challenge, Siemens developed an extensive list of requirements—IT operational requirements, FinOps and chargeback capabilities, multi-cloud support, security requirements, and business unit-specific needs—and evaluated 12 potential solutions.
After the evaluation was completed, IBM Cloudability was selected as the solution of choice. Cloudability’s proven success and superior multi-cloud capabilities, according to Kandlbinder, were significant factors in the decision. “We were looking for functional capabilities and a rock-solid product where we know there’s less risk,” he said. “We also have a great collaboration with IBM. These are more or less the main drivers for choosing IBM Cloudability.”
Moving to a new solution can be challenging. But Siemens successfully migrated to Cloudability with minimal friction. Kandlbinder explained, “As CFO, I only get involved when things don’t go smoothly. I wasn’t contacted much. It was a very good transition. We had no complaints and no escalations, which was quite remarkable and unusual.”
With approximately 7,000 cloud accounts distributed across multiple providers, unified visibility is essential for effective governance. Before Cloudability, however, Siemens only had insight about AWS and Google accounts using its previous tool. Azure, and Alibaba required separate tools and processes for viewing cost data, making it difficult to understand total cloud spending or compare efficiency across platforms.
Reliably solving this challenge with a solution that could scale was a high priority for Siemens when evaluating a new tool. “We wanted showback of costs to all the public cloud users in Siemens through a single pane of glass,” said Peter Streifler, Service Owner of Public Cloud Services at Siemens.
By adopting Cloudability, Siemens now has comprehensive cost visibility across all public cloud accounts spanning AWS, Azure, Google Cloud, and Alibaba through a single platform. This consolidated view enables better decision-making at both tactical and strategic levels, supporting key investment and optimization initiatives.
While comprehensive visibility is a critical feature for Siemens’ FinOps team, cost center owners and business unit leaders only need to see their own cloud costs. Cloudability enables Siemens to be selective, giving access to cloud costs views tailored to role-based privileges, from individual developers to senior controllers.
“We built up the whole org chart of Siemens in the tool so that when somebody orders a public cloud account, they automatically have access to their IBM Cloudability view, depending on what they should be allowed to see,” said Uli Hansmair, Digitalization Architect at Siemens.
This automation reduces administrative burden while ensuring appropriate data access controls, which is critical for a company the size of Siemens.
When it comes to commitment purchases (savings plans and reserved instances), Siemens’ corporate IT acts almost like an internal bank, making upfront commitments on behalf of business units. Commitments are managed centrally, and the cost is spread across the business units. Cloudability properly handles amortization of these investments so corporate IT can showback the cost to each business unit, ensuring the amount accurately reflects Siemens corporate discounts. Accurate showback ensures business units understand their true cloud economics, giving them vital data to make informed optimization decisions.
Optimization is key to getting the highest return possible from cloud investments. In addition to ML proactive rightsizing recommendations, Cloudability provides robust reporting capabilities, enabling Siemens to identify actionable optimization opportunities, track progress toward cost reduction goals, and educate stakeholders about cloud economics.
Kandlbinder emphasized the strategic importance of data-driven optimization. “We have quite robust reporting, and it will be more and more important in order to demonstrate how we contribute to our annual productivity (or cost reduction) target,” he said. “This reporting helps us determine where the cost reduction potentials are, where low hanging fruits are—like different storage, different CPU usage, where we have unused services or can shut down services over the weekend, and where re-architecture is necessary—in order to have a sustainable and long-lasting productivity.”
Siemens continues to expand and optimize the use of Cloudability across several dimensions:
With Cloudability as their foundation, Siemens is well-positioned to meet ambitious cost reduction targets while maintaining the agility and innovation that is required of a market-leading organization.
Learn how IBM Cloudability can unlock cloud cost savings in your organization
