Microsoft Cost Management is a comprehensive suite of FinOps tools designed to help organizations analyze, monitor, and optimize their Microsoft Cloud costs. Whether you’re managing a single subscription or multiple billing accounts, Cost Management provides the insights and control you need to make informed decisions and maximize the value of your cloud investment.

Understanding the Commerce Data Pipeline

At the heart of Cost Management is the Microsoft Commerce data pipeline, which underpins all commercial transactions across Microsoft’s ecosystem. This pipeline collects and processes usage data from your Azure, Microsoft 365, Dynamics 365, and Power Platform services, applying discounts based on your specific price sheet to generate ‘rated usage’ - the data you’ll see in Cost Management.

It’s important to note that measured usage and purchase quantities may differ from the pricing quantities due to factors like block pricing, where usage is rated in higher-level units. Cost Management shows the measurement unit quantity, while price sheets and invoices use the pricing unit.

The billing process finalizes charges, applies credits, and generates your monthly invoice. While the Billing experience handles invoice management, Cost Management is where you’ll find the detailed cost analysis and optimization tools.

Unlocking Visibility and Control

Cost Management is accessible from within the Billing experience, as well as from every subscription, resource group, and management group in the Azure portal. This ensures everyone responsible for costs has full visibility and the ability to manage and optimize their workloads.

Cost Management offers a wide range of capabilities, including:

  • Robust cost analysis and reporting, using tools like Power BI
  • Proactive cost monitoring with budgets, anomaly alerts, and scheduled alerts
  • Streamlined cost allocation through tag inheritance and cost allocation rules
  • Automated business processes and external tool integration via exports and the Cost Details API

Organizing and Allocating Costs

Effectively organizing and allocating costs is crucial for accurate chargeback and cost management. Microsoft provides several options for structuring your cloud environment, including:

  • MCA billing profiles and invoice sections
  • EA departments and enrollment accounts
  • Management groups
  • Subscriptions and resource groups
  • Resource tags

By leveraging these tools, you can map resources to the appropriate business units, environments, and owners, enabling better visibility and accountability.

Proactive Cost Monitoring and Optimization

Cost Management and Billing offer a range of alerts and optimization tools to help you stay on top of your cloud spending:

  • Budget and anomaly alerts keep you informed of unexpected changes or cost overruns
  • Scheduled alerts deliver regular cost updates to key stakeholders
  • Azure Advisor provides personalized cost optimization recommendations
  • Azure Hybrid Benefit, Reservations, and Savings Plans help reduce costs through pre-committed usage

Maximizing Your Microsoft Cloud Investment

By leveraging the comprehensive capabilities of Microsoft Cost Management, you can unlock the full potential of your Microsoft Cloud investment. From detailed cost analysis and reporting to proactive monitoring and optimization, Cost Management empowers you to make informed decisions, drive cost optimization, and realize the maximum value from your cloud ecosystem.

To learn more, explore the Microsoft Cost Management documentation and take advantage of the wide range of tools and resources available to support your cloud financial management journey.

Source: Overview of Cost Management