Cloud cost optimisation: Why this is the first lever to pull when cutting organisation costs
Ever since a certain tech mogul wielded his chainsaw in early 2025, business leaders across the world have been facing unprecedented pressure to reduce costs and minimise wastage in their organisations. This has been especially prevalent in recent times in Australia with mass layoffs happening across large and successful tech companies such as Atlassian, AWS, Microsoft, Telstra and CBA. In early 2026 Australia ranked second in the world for tech job losses, which is nothing to be proud of. The narrative of AI replacing humans has been widely blamed and while there is a lot of truth in that, the fundamental reason for the cuts is simple: to reduce expenses. But first, there are other ways to reduce costs that should be considered, such as reviewing software licensing agreements, vendor contracts, office space requirements… and of course, cloud cost optimisation.
A number of customers I have engaged with recently have said that cloud cost management is important to them, but there is no pressure from above to do anything about it. This is fine when times are good and the business is thriving, but profitability ebbs and flows in any industry and tough times are never far away. When those tough times arrive, the finance team will surely start asking awkward questions about the cloud bill. The CTO who can demonstrate good FinOps practices and cost awareness in the cloud will probably be more trusted by the CFO and consequently given more leeway when the squeeze comes. Being proactive is definitely better than being reactive when it comes to cost optimisation.
Many organisations do not actually know what their total cloud bill looks like because their costs are split across separate teams with different cost centres and reporting lines. If you don’t have an overall view of what you’re spending now, it’s hard to identify the trends and patterns across the organisation.
A centralised view of costs enables you to implement global standards, policies and reporting so that problems can be solved once and not many times over. For example, it is more effective for an organisation to implement a global S3 data management policy using AWS Organizations and Service Control Policies than to depend on individual account owners remembering to configure one per account.
Unoptimised cloud costs are like a hidden tax for any business - nobody wants this.
Spending the time now to identify and prioritise areas to focus on early will result in compounded savings. What may be 5% wastage today could easily double or triple in a year, and if poor FinOps practices become embedded into the habits and processes of engineering teams, eradicating the wastage can take a long time to resolve.
Ask the questions: Does every database need to reside in a highly available cluster by default? Are your Infrastructure as Code templates right-sized? That under-utilised EC2 instance you’re paying for incurs a recurring monthly cost - is it correctly sized? Fixing these things now saves you money every month going forward so the sooner you start tightening your cloud cost belt the better.
My advice to tech leaders is to start with visibility and then ask questions. Understand what your actual costs are, and how much each team is spending. Work with leaders to create a culture of cost awareness and maturity in your technical teams. Track costs and their trends by team, by product, by project - whatever makes sense. And make sure that all of the available discounts are being harnessed. Doing all of this may allow you to put the chainsaw back in the shed for good!
Want to see how Fortescue are doing just that? Watch our webinar, "The AWS Cost Optimisation Webinar: How to reduce your spend without sacrificing performance" on-demand here.
Do you need help with your cloud bill?
If so, Mechanical Rock can help. We offer cloud cost optimisation assessments to help you get on top of your cloud bill and understand where costs are stacking up.
But the knowledge isn’t gone when we do, we sit with your team during this process so we can share knowledge along the way.