ABN AMRO increases business agility, optimizes Azure spend by more than €1 million monthly with Azure Reservations, hybrid cloud

Getting value from the cloud

Since ABN AMRO embarked on its latest transformation initiative, the bank has learned that the cloud isn’t always as cost-effective as it initially thought. Currently, it runs more than 400 workloads on Azure, adding performance, scale, and agility to those workloads. However, not all workloads fully benefit from the public cloud. “Given the lessons learned, including Azure spend optimization opportunities, our platform approach is based on a smart placement strategy,” observes Hans De Kruif, Platform Engineer and Azure Cost Manager at ABN AMRO.

Remaking the bank without breaking the bank

To ensure development teams have the agility they need while keeping costs low, ABN AMRO has undertaken a series of innovative and leading cost management practices with Azure. For the development and test environments, the business case made use of extended office hours, while the acceptance and production environments utilized reserved instance pricing to support cost optimization.

For workloads put on Azure, ABN AMRO immediately committed to Azure Reserved Virtual Machine Instances at shared scope to optimize utilization. Based on the reservation blade in the Azure portal, potential virtual machine families deploy in new reservations every couple of weeks. The bank is also using Power BI for a consolidated view of unused reserved instances per flexibility group rather than percentages of individual reservations in the Azure portal. Based on the Power BI report, ABN AMRO exchanges unused reserved instances to keep utilization optimized. The bank added reservations for families, including Azure SQL Database, Azure Storage, and Azure App Service plans, so these products could also adhere to the same monitoring and exchange discipline from Power BI. “We want to unburden the DevOps teams using Azure by offering cost-efficient solutions, including Azure Reserved Virtual Machine Instances, dev/test subscriptions, Azure Hybrid Benefit, and commitment tiers. Through Azure Reservations, we’ve optimized our Azure spend over €1 million a month,” says De Kruif.

ABN AMRO further exercises cost-saving measures with its use of Azure Hybrid Benefit. Working in close collaboration with Microsoft on cost-saving initiatives, ABN AMRO onboarded a private preview of the centrally managed Azure Hybrid Benefit for SQL Server two years ago. This initiative gives the bank 100 percent utilization for reuse of its SQL licenses, without any risk of overcommitting its allotment. With centrally managed Azure Hybrid Benefit for SQL Server now in general availability, ABN AMRO is looking forward to the Windows Server equivalent. Meanwhile, the bank is managing and maximizing reuse of its Windows Server licenses by periodically checking and assigning Azure Hybrid Benefit to all production Windows virtual machines (VMs), which unburdens DevOps teams from having to do this and keeps the bank compliant on its license position.

While these nondisruptive mechanisms are vital in reducing costs, ABN AMRO is also driving infrastructure expenditure efficiency through cultural and behavioral change. “Our Platform and Technologies team pays the Azure bill while our DevOps teams consume the services, so increasing cost awareness is crucial,” says De Kruif. The bank is educating teams on taking advantage of Azure flexibility levers, like stopping VMs outside of business hours, rightsizing and decreasing Azure resource usage where possible, using standard services for test environments, and migrating to the latest and greatest product families. De Kruif’s group creates and publishes vital Power BI reports that outline areas of noncompliance with Azure best practices. For example, the Power BI report shows underutilized databases and recommends the most beneficial size and its potential cost savings. The report also provides a link to performance metrics on the Azure portal as evidence to help teams understand and implement these recommendations. 

For workloads that are migrating to Azure, DevOps teams estimate the cloud cost based on their designs and apply Azure flexibility levers. This estimate is used as a monthly spend target to report against actuals. “We’re challenging our DevOps teams to take ownership of their Azure deployments by increasing their cost awareness,” De Kruif states. ABN AMRO further incentivizes team alignment by educating its employees about how cost reductions help drive the company’s sustainability targets. “Along with cost savings, we measure and show how much carbon each application uses, and we try to translate that expenditure into something our people can understand, like charging a phone or taking a flight,” says De Kruif.

In October 2022, ABN AMRO gained a new cost-saving opportunity with the Azure savings plan. This offering has given the bank great flexibility over compute product families, which proved cost-effective for its dynamic Azure Databricks clusters and Azure Virtual Machines and App Service plan scale sets. To maximize the benefits, ABN AMRO is now using Azure Reserved Virtual Machine Instances for its stable workloads and using the Azure savings plan on top as a flexible cost-saving layer. Complementing cost savings with performance and security enhancements, the bank also taps into the data, alerts, and overall visibility gained through Azure Monitor and security analytics from Microsoft Sentinel.

Cost-effective flexibility helps deliver real value

ABN AMRO now has the transparency and flexibility it requires to make cost-optimization decisions, and it has the capabilities it needs to deliver real value for customers today and tomorrow. The bank is further optimizing costs by taking advantage of Azure Hybrid Benefit, reservations, license usage, and guiding its DevOps teams with recommendations on resource utilization. It’s all part of the FinOps journey the bank is taking to make the organization more cost aware. “On Azure, we can make costs transparent to share consumption information with teams, applying the Azure optimization levers and reservations for multiple product families,” concludes De Kruif.

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