Cloudability Cost Sharing in Cloudability

Edit online

Overview

Cost Sharing helps organizations share out line items across Cloudability to help properly account for spend and help facilitate accurate and defensible showback and chargeback exercises. Cost sharing builds on the Business Dimensions functionality to provide even further granularity on how direct costs can be shared out.

Sharing of costs is the act of taking a bucket of spend (e.g. a dimensional value's direct charges) and sharing that value across a list of destination dimensional values, so those destinations are burdened by the source's direct cost. A simple way to think about this is every dimensional value has a direct cost within Cloudability. This cost has been derived through a combination of raw data ingestion of said resource cost, synthetic tagging of said resource cost, and/or decoration of said resource cost through conditional logic done in our business mappings feature.

Since each dimensional value has a direct cost, when they are the on the receiving end of cost sharing (meaning, they have some sort of cost that has previously been shared with them through our cost sharing feature) the also consume a shared cost. This means, for any post allocated dimensional value, it has a direct cost, shared cost, and a total cost (direct+shared).

Cost allocation rules are done within the context of a singular business mapping. Multiple rules can be configured within a Business Mapping, but we do not support cross Business Mapping allocations at this time.

Benefits

The benefits of Cost Sharing are as follows:

  • Accurate Cost Attribution : Enable precise tracking of shared resources and services across teams, products, and business units

  • Defensible Chargeback Model : Create transparent, rule-based cost distribution that supports internal billing practices.

  • Flexible Allocation Strategies : Choose from multiple allocation methods to match your organization's cost sharing requirements

  • Business-Aligned Cost Management : Map technology costs to business outcomes and organizational structure

  • Enhanced Cost Visibility : Gain clear insights into both direct and shared costs across your cloud environment

Core Concepts

Organizations have varying needs in how they allocate and share costs out. Because of this, we have included the most common allocation strategies as requested by our customers. These allocation strategies include: Even Split , Fixed Weighting , Proportional (By Direct Charges) , and Telemetry/ Consumption based allocations (Not available to Cloudability Essentials customers.

The various types of costs incurred are:

  • Direct cost : Costs derived through raw data ingestion, synthetic tagging, or business mapping decoration

  • Shared cost : Costs received through cost sharing rules from source dimensional values

  • Total cost : Combined value of direct and shared costs for any dimensional value

Allocation Strategies

  • Even Split –Defines a spread of direct costs (either a single dimensional bucket’s direct charge or multiple dimensional bucket’s direct charges) across a set of dimensional buckets at equal value.

  • Fixed Weighting - Uses fixed weights as a percentage, a breakout of direct costs (either a single dimensional bucket’s direct charge or multiple dimensional bucket’s direct charges) based off a user-defined weighting.

  • Proportional - Direct Charges - Uses the direct cost as the weighting allowing organizations to dynamically weigh the allocation based off the source destination’s direct charges. Proportional weighing will take into account the source buckets direct charges when it calculates the assignment ratio for the given allocation.

Configure Cost Sharing rules

To configure Cost Sharing rules, follow the steps below:

  1. Navigate to the Cost Sharing tab within the Organize section on the left hand navigation pane of Cloudability.

  2. Select New Allocation if you intend for a business dimension. Alternatively, select an existing business dimension to edit the allocation rule. Create a new set of allocation rules within the context of a business dimension. There is no limit on how many allocation rules you can set.

  3. To create a new rule, click New Rule . Select the source buckets you wish to share costs from, the destination buckets you wish to share costs to, and the allocation strategy that you choose to weigh these costs by. Existing allocation rules if any are displayed under the Rules table.

  1. Finally, navigate to the Explorer tab to view your shared costs and applied allocation rules.

Reporting

We have exposed a new projection in Apptio BI for reporting on shared costs called Cloudability Cost and Usage (Allocated). This is a separate projection due to the scale and size of the data set that we work with while running all cost allocation rules. To build a report from this shared cost, follow the steps below:

  1. Navigate to Apptio BI in the right hand navigation pane.

  2. Select New Report or edit and existing report within your reports.

  3. Click New Visualization and select the Cloudability Cost and Usage (Allocated) projection.

  4. Create your report with the same dimensions and cost metrics that are available in the Cloudability Cost and Usage projection.

Views

Cost sharing respects our view construct by showing shared line items under the destination bucket when that bucket is included in a view. For example: For a business dimension called Product with multiple products within titled products A, B, and C. now, our organization allocates A’s costs out to B and C on a proportional basis (by direct charges) resulting in B and C absorbing A’s direct cost. Now, for a view configured with C, when a report is created in Apptio BI , product C’s view would display both their direct charges as well as the cost that was shared with them from A.

Best Practices

Some of the best practices in Cost Sharing Include aspects of Rule Configuration and Cost Management .

For configuring rules, they include:

  • Start with simpler allocation rules and gradually increase complexity

  • Document the business justification for each allocation rule

  • Regularly review and validate allocation rules against business changes

  • Consider the hierarchical impact of allocations within your organization

  • Cost allocation rules operate within a single business mapping

For Cost Management, the following best practices are observed:

  • Monitor both direct and shared costs to identify trends and anomalies

  • Validate allocation results monthly to ensure accuracy

  • Maintain clear documentation of allocation decisions and methodologies

  • Consider seasonal variations when setting up allocation rules

Import and Export Functionality for Cost Allocation Rules

We support import and export capabilities for cost allocation rules to streamline setup and enhance flexibility:
  • CSV Import: Customers can now upload cost allocation rules via CSV, removing the need to configure them manually in the user interface (UI) I or programmatically through the API.
    • This is ideal for bulk generation of allocation rules.
    • A CSV template is available at the bottom of this document that provides a sample template that can be used when importing rules. Alternatively, if you have a set of rules already and you export them, they will export with the correct column headers and values supported for upload.
    • The list of columns that we require are as follows:
      • Rule ID: A unique identifier of the rule in question. If you are building multiple statements in a given rule, (For example: You are splitting out multiple source buckets across multiple destinations) you will need to include the same rule ID for all statements
      • Allocation Method (this needs to be one of the following): even_split, proportional_fixed_weighting, proportional_metric, or telemetry_consumption. Note that telemetry is only supported in Cloudability Standard and Premium trims
      • Source: the set of source buckets you wish to allocate the cost from
      • Destination: the set of destination buckets you wish to allocate the cost to
      • Destination Weight: this should be the weight of the allocation to this specific destination
      • Telemetry Identifier: this should be set to custom
      • Telemetry Metric Name: the name of the metric that is used to weight the allocation. This can be Number of API calls, number of Rideshares, number of customers, and the likes.

  • Export Existing Rules: Customers can now export their current set of cost allocation rules within a business dimension.

Cost Allocation Rules Template
Table 1. Cost Allocation Rules Template
Rule ID Allocation Method Source Destination Destination Weight Identifier Telemetry Metric Name
2310fe9f-6535-474b-a153-27719a485168 even_split cloud billing 0.5    
2310fe9f-6535-474b-a153-27719a485168 even_split cloud acme 0.5    
2 telemetry_consumption compute   0 custom Number of SQS Requests
3 proportional_metric data vanguard 0    
3 proportional_metric data nimbus 0    
3 proportional_metric data billmx 0    
3 proportional_metric pipeline vanguard 0    
3 proportional_metric pipeline nimbus 0    
3 proportional_metric pipeline billmx 0    
4 proportional_fixed_weighting billingdata ccm 0.4    
4 proportional_fixed_weighting billingdata infosec 0.6    
4 proportional_fixed_weighting datalake ccm 0.4    
4 proportional_fixed_weighting datalake infosec 0.6    
4 proportional_fixed_weighting techops ccm 0.4    
4 proportional_fixed_weighting techops infosec 0.6    
5 even_split operations ccm 0.5    
5 even_split operations vedas 0.5    

Explorer Page Data Export

We’ve also added the ability to export data from the Explorer page. Customers can now download detailed reports of:

  • Direct costs: the direct costs that are associated to the given set of destination buckets

  • Shared costs: this makes it easier to analyze and share cost data aligned to specific allocation rules

  • Total costs: what the direct + shared costs are for a given set of destination buckets

Cost Sharing by Business Metrics

We are expanding the power and precision of Cost Sharing with new support for custom Business Metrics.

Share Costs Across Any Currency-Based Business Metric

Previously, Cloudability supported cost sharing only across a predefined set of default cost metrics. With this update, customers can now allocate shared costs across any currency-based Business Metric in their environment.

This enhancement provides greater flexibility in how you define and apply your cost allocation logic, enabling:
  • More contextually relevant cost allocations tailored to your business’s unique financial model
  • Stronger defensibility of shared cost distribution by aligning it with metrics that matter most to your teams

  • Expanded reporting capabilities using metrics beyond the defaults

Currently, only currency-based Business Metrics are being supported.

Where You’ll See This

  • Explorer Page: When setting up or reviewing cost sharing rules, you’ll now see all eligible Business Metrics available for selection

  • Apptio BI: You can also select from the full set of supported metrics when creating reports, enabling deeper insights and alignment across stakeholders

This update is available to all Cloud ability customers and requires no additional configuration to begin using.