The R & D Team’s Growing Responsibility for Cloud Spend
In the not-so-distant past, tech companies were laser-focused on growth. They prioritized infrastructure that could quickly and effortlessly scale with their needs. Cost was not a primary concern.
But then the pendulum suddenly swung from growth to profitability. Those infrastructure bills that were previously fast-tracked came under the microscope. And what many organizations saw was shocking.
We've witnessed this firsthand at ScyllaDB, the company behind a monstrously fast and scalable NoSQL database. Traditionally, ScyllaDB has been called on to assist organizations for two primary reasons. First, the need to scale. Organizations like Discord, Zillow, Disney+Hotstar, Expedia, and Sharechat, distinctly selected ScyllaDB because of its ability to handle exponentially growing OPS. Second, the need to reduce the overhead of managing complex NoSQL databases. Organizations like Rakuten, Ticketmaster, and Fanatics selected ScyllaDB because of its ability to dramatically reduce the amount of time and headcount required to tune and optimize database clusters.
Now, ScyllaDB is seeing a different trend emerge. The trend that drove over 60% of the buying decisions in the previous two quarters was “Cloud Bill Shock”: the sticker shock that’s experienced after seeing exactly how much you’re paying cloud providers.
Conversations with companies struggling with Cloud Bill Shock yielded some interesting insights:
“...our business was growing and we were blowing through our [Cloud] budget.”
“Most of our teams cannot accurately estimate what the monthly cloud spend will be.”
“...[We] lost some very smart developers and engineers because they really did not understand how DynamoDB pricing worked and our department took a big financial hit.”
“[Company] just began to pay R&D bonuses based on the reduction of cloud spend.”
Cloud Bill Shock is certainly not a new concern. The State Of Cloud Cost Intelligence 2022 reported that “only 30% of organizations know exactly where their cloud costs are going.” But now there is the threat of a global economic slowdown, and this threat forced organizations to take a closer look at spending. The bigger spend items with low monthly predictability emerged as target areas for cost reduction and therefore risk reduction. The urgency to control Cloud Bill Shock manifested itself across companies of all sizes.
Another thing that’s changing: how organizations are reacting to Cloud Bill Shock. Among the surge of organizations turning to ScyllaDB for the cost savings achieved via the database’s efficiency and extremely high throughput, we started noticing quite a few mentioning that their organizations offered their R&D staff a bonus for controlling or reducing cloud spend.
Curious if these were just isolated incidents that caught our ear, we developed a quick survey to explore to what degree R&D Staff Bonuses were being used as an incentive for better cloud cost control. At the time of publishing (January 2023) this survey had over 300 respondents across a fairly balanced range of organization sizes.
To assess the prevalence of cloud cost savings bonuses, we asked: Does your company offer a bonus (to individuals or teams) for reducing cloud spend?
25% of respondents reported that they already had a bonus structure in place for delivering cloud cost savings. However, 34.9% reported that they were considering this type of bonus for the R&D team in 2023.
To get a feel for the prevalence of Cloud Bill Shock, we also asked the question: Within a single year, has your team or organization experienced database-related "Cloud Bill Shock" (significantly higher than expected cloud expenses)?
Only 11.5% of organizations have not experienced Cloud Bill Shock. A staggering 79.1% of organizations experienced Cloud Bill Shock either occasionally or constantly within a one-year time horizon.
Reducing Cloud Bill Shock for Your Database
How much could you save by replacing your existing database with an API-compatible alternative that offers better performance at significantly lower costs? Compare multiple vendors’ prices with this Cloud Database Pricing Calculator.
And if you’d like to explore whether ScyllaDB might be a good fit for your team’s particular use case, workload, and ecosystem, reach out and we’ll connect.