Carlsberg Group increases cloud efficiency with FinOps and Azure solutions

Adoption of FinOps best practices

With a portfolio of 140 brands across 150 markets, Carlsberg Group brews around 10 billion liters of beer annually. This kind of production can only happen when breweries run 24/7, which makes IT migrations challenging. Peak product demand is May through September, and any system downtime would affect production. So when Carlsberg pioneered a cloud-first approach bymigrating most of its IT infrastructure to Microsoft Azure, it had to do so quickly and during the cooler months.

In Q4 of 2018, Carlsberg began its FinOps journey to manage investments for its new IT environment. The company investigated ways to rightsize cloud resources and eliminate idle capacity while optimizing backup and storage costs. Laurent Gaertner, Director of Global Network and Hosting at Carlsberg Group, says, “Exploring cloud-native solutions that support FinOps strengthened the rapport we developed with Microsoft during our cloud transformation. Microsoft understands the mindset of innovation, which is part of our core business."

Carlsberg uses the FinOps toolkit to streamline its Azure configurations, especially around backup and storage. The company also relies on Microsoft Cost Management data in the Azure portal to see how usage changes over time at a granular level and Azure Advisor to get cost optimization recommendations. With Azure Hybrid Benefit, Carlsberg leverages existing on-premises software licenses to run Red Hat Enterprise Linux, Microsoft Windows, and SQL Server in the Azure cloud at a reduced cost.

Based on data from Azure Audit Logs and on planned lifespans for applications, the company gets discounts on certain products with Azure reservations. Carlsberg also applied Azure savings plan for compute for its services. For long-term, stable workloads with consistent usage, 90% of the company’s Reserved Instances (RIs) are committed to three-year terms. For workloads that are relatively stable but require more flexibility, it allocates 7% to one-year RIs. The remaining 3% is committed to a three-year Savings Plan, mainly for dynamic or seasonal workloads that require greater flexibility. With this approach, Carlsberg saves between 40-65% on compute services.

Carlsberg implemented FinOps best practices, like workload optimization and snoozing, for its SAP development and sandbox environments on Azure. With snoozing, the company avoids paying for nights and weekends, when resources aren’t in use. Carlsberg uses Azure Policy to enforce policies across virtual machines and subscriptions while also receiving recommendations for new policies. The company configured a monthly recommendation digest in Azure Advisor, which is emailed directly to its IT administrators.

Maximization of business value in the cloud

By adopting FinOps culture and best practices, Carlsberg gained the transparency and management tools to generate cost efficiencies. By the end of 2019, its optimizations resulted in a 7-10% cost savings annually from rightsizing VMs, optimizing storage, and using reservations and policies like snoozing resources. The company achieved another significant cost reduction with Azure Hybrid Benefit, while noting that FinOps is an ongoing practice. “FinOps is not a destination, it's a journey that you fund by making sure that every dollar that you spend in your business is giving you some value,” says Sonal Gupta, Senior Manager of FinOps and Hosting Service Delivery at Carlsberg Group.

For automation and governance, the company manages built-in and custom policies in Azure Policy. Most relate to snoozing and to tagging, which helps users categorize Azure resources, resource groups, and subscriptions. Tagging the team or group by subscription and workload provides a clear understanding of who consumes what services.“The solution supports financial awareness; everyone feels accountable for their cloud spend and avoids additional costs. We can budget and forecast, investing in just what we need, without cost spikes,” says Gupta.

When it comes to FinOps and Azure, “The main benefit is having our IT foundation in the cloud. From there, it’s easy to use the rest of our Microsoft products to support business development in the digital space. We have the flexibility to innovate—to deploy a feature or develop an app quickly,” says Gaertner.

Support for sustainability and the future

Carlsberg will keep some applications on its own servers to support 24/7 operations and data locality requirements around on-premises storage and information residency. It plans to use Azure Stack HCI to move half those applications to the cloud, to create a redundant environment with high availability. It has also begun using Cost Management APIs and Azure Import/Export service to fetch and analyze data from various sources, including Azure cost and billing data. The company uses these APIs and exports to create custom dashboards, billing centers for application owners, and other personalized views to provide full transparency through a single pane of glass, but is not yet using any imports. To unify its data and create a single source of truth for various personas, Carlsberg uses Microsoft Fabric. “Someday soon, we may use Microsoft Fabric for supporting our sustainability initiatives by enabling the collection, analysis, and action on data from multiple sources,” says Gupta.

The company will use FinOps Open Cost and Usage Specification (FOCUS), which is designed to establish a common billing data format to improve understanding of cloud cost and usage patterns.

Carlsberg Group has begun using Copilot in Azure to support FinOps. Carlsberg plans to create a knowledge-mining solution for employees that uses a chatbot. It also plans to develop a custom Copilot instance that uses Azure AI services to elevate the company’s FinOps practices to the next level.

Carlsberg plans to get visibility into its carbon emissions with Azure carbon optimization, and looks forward to more environmental, social, and governance support with FinOps. Gupta says, “FinOps contributes to our sustainability by helping us shut down systems when not in use, saving costs and energy.” When it comes to the future, she adds, “Our FinOps practice has the ability to further support our sustainability initiatives by using and sharing data from Microsoft solutions like the Emissions Impact Dashboard and Azure carbon optimization.”

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