Azure Cost Governance — Tagging, Budgets & Policy

Cloud Migration
Cloud Architecture

Cloud cost overruns are not an Azure problem — they are a governance problem. This is the cost management framework I implement for enterprise Azure environments to make cost visible, attributable, and controllable.

Key Patterns & Steps
  • Enforce mandatory tags (environment, cost-centre, owner, project) via Azure Policy deny effect — no tag, no deployment
  • Budget alerts at subscription level: 80% forecast triggers email; 100% actual triggers Logic App to notify Slack/Teams
  • Use Azure Cost Analysis with tag grouping to show per-team spend — share monthly reports with engineering leads
  • Advisor recommendations: review reserved instance opportunities quarterly; 1-year RIs for stable baseline workloads
  • Identify idle resources with Azure Monitor: VMs with <5% CPU for 14 days, unattached disks, unused public IPs
  • Showback model: assign costs to business units even if centrally paid — accountability follows visibility
Lessons Learned
Teams only optimise what they can see. A $2M cloud bill became a $1.1M bill in six months purely through tagging enforcement and reserved instance conversion — no architecture changes required.
Technologies
Azure Cost ManagementAzure PolicyBudgetsFinOpsTaggingReserved Instances
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