Even though public cloud turns 12 this year, many companies are still kicking the tires to see if it’s right for them. Not so with Asurion. After six years of steady adoption and putting in place solid governance processes, they went all in with a cloud-first approach 18 months ago. Now, almost all of their new spending on infrastructure and change-the-business activities go to Amazon’s AWS and Microsoft’s Azure clouds.
“We’re a technology company and that means we’re all-in on the cloud,” said Juliet Orgain, manager of Asurion’s TBM office. “Ninety-five-plus percent of all of our new development, all of our new business happens in the cloud space. We’re also in the process of moving large pieces of our on-prem infrastructure rapidly into the cloud.”
At the beginning of 2017, Asurion notes that public cloud made up just 20 percent of IT’s overall compute spend. Since then, that number has increased to 55 percent. This was not a hastily made decision nor one without risk. While it certainly results in saving money, the more important goals were invigorating innovation and speeding time-to-market.
As the premier comprehensive protection and smart tech help provider to some of the world’s leading wireless carriers, retailers, and pay-tv providers, Asurion IT’s department supports more than 300 million people globally and 17,000 employees. So maintaining very high services levels while rolling out innovative new offerings to their customers’ customers is its business. But even technology companies can be reluctant to own and operate infrastructure. They want to innovate. With most of Asurion’s production workloads now running on the cloud, understanding where technology dollars are going and the related value being produced is more important than ever.
“The idea was to create a much faster, much more nimble technology environment,” said Ted Townsend, Asurion’s Director of Operations Finance, Technology Business Management. “For everybody, from top-to-bottom in the technology organization, we’re opening the door for them to derive all the benefits that public cloud provides and help them speed to market in terms of innovation.”
Managing cloud spend is all about governance
While getting innovations to market sooner benefits the business, the ability to govern cloud spending down to the penny is what helped Asurion’s IT department facilitate the move to cloud so quickly. Prior to adopting Apptio Cloud Cost Management (CCM), Asurion’s IT finance operation managed cloud spend manually based on vendor’s cost calculators and spreadsheets. According to Asurion, these weren’t providing the level of accuracy the team wanted or lending credence to strategic cost conversations with IT partners.
“When trying to estimate or forecast cloud costs using generally available tools like Amazon’s estimator, a 50 percent over/under was pretty darn good,” said Orgain. “Now, we’re getting down to one percent on forecasts. We know exactly what we’re looking at, exactly what’s coming up. So even when things happen, as they inevitably will, the governance team has the dollar amounts, and they know who spun up this service, who is using it, and who’s financially responsible. It’s easier to go back and have that conversation about, ‘Is it necessary? What should we do about it? What’s next? Is this really the best use of our funding?'”
This ability to trend monthly forecasts so closely to actuals has done wonders to improve IT’s credibility with the business, remove unanticipated spending spikes, and save money on, in Asurion’s words, “massive retroactive cleanup efforts.” By automating forecasting in Apptio CCM, they have also managed to save an additional 10 person-days, per-month on manual entry and data normalization efforts. They can now get information that used to take up to five days in approximately 15 minutes. Asurion recognizes other benefits that transcend hard dollar savings, as well.
“There are a couple of benefits that we derive from that,” said Townsend. “One, as we talk to our cloud providers, whether it’s Azure or AWS, it allows us to have a much higher degree of confidence in terms of things like overall spend commitments. It also enables us to more effectively communicate about transitioning to a broader cloud footprint. For instance, we’ve been able to marry our forecasting process and our accuracy around cloud spend to create a five-year strategic roadmap, which we’ve shared with senior executives in Finance, IT, and lines of business.
“Our ability to hit the mark regarding spend projections has given us a lot of credibility with senior leadership. Those results coupled with our demonstrated governance partnership have really freed up our time to work on strategic projects around cloud rather than preparing for the next battle on cost. And IT can spend less time justifying cloud spend versus time actually working in the cloud.”
Our ability to hit the mark regarding [cloud] spend projections has given us a lot of credibility with senior leadership.
Director of Operations Finance, TBM
Changing the conversation from cost to value
Understanding where the money is going, who is spending it and why is important, of course, but when IT is charging the business for its cloud consumption, having spend and consumption numbers in-hand—numbers that everyone agrees are accurate—allows Asurion’s Cloud Governance team to not only change the conversation from cost to value, but also offer line-of-business IT leaders well-informed options for managing that spend.
The most significant example of this dynamic in action to date was the decision to remove six petabytes of data from long-term storage—freeing up over a $1M per year that is now going to new product and service development. In total, Apptio and TBM have enabled Asurion IT to shift 10 percent of its overall budget from run-the-business to change-the-business.
Even small wins add up. Earlier this year, from more than 40 million rows of daily cloud billing data, Asurion’s TBM team spotted a billing error of $8,000 per month. This was just wasted money, providing no benefit to Asurion whatsoever. Without Apptio CCM, identifying this error would have been much, much harder.
“Apptio lets us have a dynamic reporting service, an interactive experience if you will, which is miles beyond the numbers on a spreadsheet that we used to see,” said Orgain. “Today, we’re showing all of our technology leaders exactly which services they’re using, how those are categorized, where they fit into the ATUM model, and how they relate to the services and costs that they’re accustomed to seeing for the private cloud or on-prem product.”
“It really changes behavior. So, by getting those numbers out early and often, and even beyond that month’s forecast, allowing our teams to see real-time, day-to-day numbers on their spend lets us make intelligent, more strategic decisions closer to real-time,” said Orgain. “An ocean of data is boiled down to contextual recommendations and key performance indicators.”
Currently, Asurion’s TBM team only reports cloud spending numbers to Technology Finance and business unit CIOs who then make the decisions around consumption. Future plans call for the inclusion the line of business leadership, as well. To facilitate this transition, they have developed cloud TCO reports for all of the 230 platforms that are currently operational on AWS and Azure.
It’s all about enablement, not cost
Because TBM is designed to track and allocate costs so IT and the business can finally see where all of their technology dollars are going, it may seem very tactical. But those insights also give CIOs and line-of-business leaders the power to come together around a common set of numbers that reflect what is really happening with technology throughout the organization. And that is transformational and strategic.
“This story is really about enablement,” said Townsend. “We do have a governance process, we do tightly control spend, we tightly control rogue services, and rogue operations in the cloud. But our partnership with the Cloud Governance team and IT leaders enables our technologists to derive all of the benefits that cloud gives them.”
“So, instead of putting shackles on our technologists because we don’t have visibility,” added Orgain, “we’re freeing them to explore a new service, to provision what they need, and to turn the public cloud into a strategic business advantage.”
Instead of putting shackles on our technologists because we don’t have visibility, we’re freeing them to turn the public cloud into a strategic business advantage.
Juliet Orgain Manager