Cloud governance dictates how an organization operates services in the cloud based on a defined set of rules and policies. The structure provided by cloud governance ensures that an organization’s cloud services support operations and provide the necessary security.
Cloud governance is essentially the application of IT governance policies to cloud services, but to a far more extensive degree. Due to the breadth of services encompassed with cloud deployments, cloud governance must consider many areas to keep systems running smoothly and securely.
Cloud governance covers finance, operations, security, compliance, data management, application performance, asset management, and configurations.
Real-world examples of cloud governance functions
Most organizations have a cloud governance committee to oversee this function. The cloud governance committee is a cross-functional team with representatives from senior management, IT, security, compliance, and business units. It is responsible for setting and overseeing overall cloud governance policies and standards.
Ensuring compliance with industry regulations
Cloud governance is increasingly used to support organizations’ compliance programs. Key areas where cloud governance helps with compliance are providing frameworks for the following.
- Access management
Utilizing strong identity and access management (IAM) systems to control who can access cloud resources and data. - Auditing and monitoring
Regularly reviewing cloud activity logs to identify potential compliance issues related to user behavior, configurations, and updates. - Data classification
Identifying and categorizing sensitive data to implement appropriate security measures and access controls based on its privacy level. - Data encryption
Ensuring that all sensitive data is encrypted at rest and in transit to protect against unauthorized access in case of a breach. - Incident response planning
Establishing and enforcing clear procedures to respond to security incidents and minimize data loss in the cloud. - Vendor management
Regularly assessing and monitoring the security practices of cloud service providers to ensure compliance with relevant regulations.
The following are several industry-specific examples of how organizations use cloud governance to support compliance.
- E-commerce
Online retailers use cloud governance to guide oversight and management of their cloud environments, including implementing robust data subject access request procedures, enforcing data retention policies, and ensuring that user consent is obtained in accordance with privacy regulations. - Finance
Cloud governance provides structured oversight for credit card processing companies to ensure that all cloud providers being used are certified for PCI-DSS (Payment Card Industry Data Security Standard) compliance, implementing strong encryption for cardholder data, and regularly monitoring for potential security vulnerabilities. - Healthcare
Healthcare providers leverage cloud governance to monitor their cloud environments and ensure that they maintain compliant data storage and access controls. Cloud governance also guides regular risk assessments on data handling practices and direct staff training related to patient privacy regulations and data handling.
Establishing and monitoring service level agreements (SLAs)
SLAs are also guided by cloud governance policies, which provide direction on minimum service levels, security measures, and other critical business elements. Examples of how organizations use cloud governance to guide SLAs include the following.
- Compliance: To ensure that requirements for relevant laws and regulations are being met
- Data management: To help create data access controls as well as define data ownership, retention, and destruction rules
- Service levels: To specify minimum service levels, including availability, security, and responsiveness
Managing data lifecycles
The management of data lifecycles is also guided by cloud governance policies. This includes data classification, data retention, access control, and data masking. The following are real-world industry examples of how cloud governance supports data lifecycle management.
- E-commerce: Employing granular access controls to restrict who can view specific customer details based on their role and location to adhere to privacy laws requiring organizations to implement access controls to protect personal data
- Financial services: Implementing data retention policies for customer transaction data based on compliance standards, which requires financial firms to retain thorough records
- Healthcare: Defining different retention periods for sensitive patient data (e.g., medical records) based on regulatory requirements and clinical needs
- Retail: Masking sensitive customer information (e.g., credit card numbers) when sharing data across different departments
Additional examples of cloud governance functions
- Defining roles and responsibilities
- Determining alert escalation procedures
- Enabling access control requirements
- Enforcing network policies
- Implementing disaster recovery policies
- Providing guidance for cloud usage protocols
- Setting data classification schemes
- Specifying allowances for cloud services
Why cloud governance is important
A sound cloud governance strategy is important because it helps organizations realize the full benefits of the cloud and avoid costly missteps that are common in cloud deployments.
Cloud governance provides a system that structures rules and provides guidance on how to best combine technology, people, and processes to achieve desired results, maintain security, abide by budgets, and optimize performance.
The following are several ways that cloud governance supports the enterprise.
Helps with defining roles and responsibilities
Cloud governance is widely used by organizations to provide a framework for defining roles and responsibilities and enforcing related policies, such as access privileges assigned through identity and access management (IAM) systems, decision-making authority, and escalation procedures. In addition, procedures for monitoring and auditing roles and responsibilities, primarily in terms of access privileges, are overseen through cloud governance.
Improves cloud resource management
Cloud governance can segregate cloud workloads into individual accounts for departments, projects, or cost centers. This breakout helps control costs, increases visibility, and reduces security vulnerabilities.
Increases administrative efficiency
With cloud governance, policy definition and application are streamlined and can be applied across an organization. This centralizes control over cloud resources to reduce non-compliant activities and enable teams to manage costs more efficiently.
Facilitates management of cloud computing resources
Cloud governance provides direction for how to manage workloads for optimal operational efficiency and security. For instance, cloud governance can include directives for when to move multi-tenant workloads residing in a single cloud account or subscription into their distinct accounts.
Minimizes cloud security risk
By establishing and enforcing rules, cloud governance is able to improve data protection, integrity, and availability. Cloud governance extends controls across all systems to protect information no matter where it resides.
Supports the implementation of disaster recovery policies
Cloud governance is widely used to inform disaster recovery policies. A key area where cloud governance supports disaster recovery is helping organizations to clearly define which data and applications are most critical to business operations. This helps prioritize their protection and recovery readiness.
Automation and cloud governance
Automated cloud governance policy management platforms store policies and monitor activities. If a policy violation is detected or an action requires approval before it is permitted, the system can automatically respond.
Cloud governance policy automation allows IT teams to govern by exception, saving time and allowing IT personnel to focus on more productive activities.
Cloud governance automation functions
A cloud governance policy management platform can take automated actions to support cloud environment management, such as:
- Advise when costs are projected to exceed a monthly budget
- Audit cloud usage
- Automate processes, including infrastructure provisioning, enforcement actions, resource allocation, cloud security, compliance, network management, and workload management
- Detect and fix vulnerabilities automatically
- Halt an action until the approval workflow process has been completed
- Revoke access to misconfigured accounts or any that exhibit suspicious activity
- Schedule workflows
- Send an alert about a violation (e.g., text, email)
- Stop an activity that violates a policy
- Suspend the launch of a virtual machine if its Central Processing Unit (CPU) capacity exceeds a certain level
- Terminate a virtual machine with unauthorized open ports
Cloud governance automation benefits
Benefits realized with cloud governance policy automation include:
- Eliminating human error
- Gaining visibility into cloud usage
- Optimizing management of security, costs, operations, and performance
- Planning and managing budgets more effectively
- Scaling well beyond manual control capabilities
- Streamlining cloud policy definition and enforcement
- Increasing administrative efficiency
- Enabling teams to manage costs more efficiently
- Allowing policies to be applied across an organization
- Centralizing control over cloud resources to reduce non-compliant activities
Cloud governance principles
Cloud governance principles provide the basis of an effective program. The following are essential for providing proper controls to optimize the use of cloud services.
Asset and configuration management
Keeping control of assets and their configurations is an important part of cloud governance.
With cloud deployments’ propensity to become a sprawl, cloud governance enables the order and processes necessary to maintain operational efficiencies, control costs, and ensure that security and privacy requirements are met. Cloud governance provides direction for resource allocation and configuration.
Data management
Cloud governance plays an integral role in the management of an organization's data lifecycle, including data classification, encryption, access, storage, and deletion. Establishing and enforcing cloud governance policies for data management ensures that the right controls are in place to make data accessible, protect sensitive data, and eliminate excess data that increases attack surfaces and storage costs.
Financial management
Building financial management into cloud governance helps keep cloud usage within budget. Using cost controls, reporting, and alerts as levers, cloud governance policies help organizations utilize cloud resources in a fiscally responsible way. Cloud governance establishes the guidelines and policies to optimize usage and avoid cost overruns.
Operations management
Operations management focuses on setting parameters for how cloud resources deliver services. Cloud governance policies related to operations management include directions on how to execute key operations functions.
Performance management
Cloud governance includes providing direction for the monitoring and management of application performance and infrastructure resources. Cloud governance helps deliver efficient and expected levels of IT service.
Security and compliance management
Security and compliance management functions related to cloud governance should build on security policies, programs, and processes already in place.
Cloud governance frameworks
Cloud governance frameworks detail the functions that fall under cloud governance principles. These are required to establish controls and optimize the use of cloud resources.
Each of these elements is interwoven to create a rich cloud governance program that directs operations without encumbering users. Examples of what is included in each area of cloud governance frameworks are the following.
Asset and configuration management
- Controlled processes to deploy clusters or use cloud services
- Specifications regarding what to run or deploy in an environment to support applications
- Directions for controlling the use and storage of secrets, such as credentials and encryption
Data management
- Data access
- Data lifecycle management
- Data privacy
- Data quality
- Data security
- Data stewardship
Financial management
- Allocating and tracking cost and data usage
- Budgeting
- Forecasting
- License management
Operations management
- Creating rules and processes that control how to create new applications or workloads that run in the cloud
- Defining requirements for monitoring and logging
- Deploying application code to various environments
- Determining how resources are allocated
- Establishing how to determine resource requirements for new applications
- Estimating computer, storage, and network requirements
- Setting rules for how the state of the cloud is monitored to ensure SLAs are met
- Specifying identity and access management requirements
Performance management
- Latency to retrieve data, load webpages, or call an API function
- Number of connected and active users
- Number of database transactions per time period
Security and compliance management
- Application security
- Backup and recovery
- Business continuity planning
- Data encryption and key management
- Identity and access management
- Monitoring and reporting
- Privacy policies and controls
- Risk assessment and management
Choosing a cloud governance solution
Cloud governance tools serve several purposes, such as:
- Demonstrating compliance with standards and regulations
- Enabling a high level of automation across a wide range of enterprise data sources, including multiple clouds and hosted applications
- Managing and protecting data
- Providing robust search capabilities
- Simplifying reporting
When choosing a cloud governance solution, the complexity of the strategy should be considered. For large organizations with a nuanced cloud governance strategy, specialized tools are helpful. These can help with management functions, such as resource allocation and cost management.
Another consideration when selecting cloud governance solutions is how they support the overall strategy and implementation of best practices, including the following.
Cost management
Cloud governance policies can be used to direct the implementation of cost management controls and reporting, as well as ongoing monitoring and optimization to continue to improve results. In addition, cloud governance policies can provide guidance for capacity management, including processes for identifying when unused resources should be deprovisioned, and analyzing where managed services should be used.
Operational excellence
Cloud governance can be used to dictate how resources are provisioned, with a focus on replacing manual processes with automation.
Performance optimization
Cloud governance policies can be used to direct how workloads should be evaluated and deployed for optimal performance.
Security
Cloud governance policies need to consider how security is handled and by whom.
Understanding the divisions of security responsibilities between service providers and customers is crucial. Then, cloud governance policies should be applied to enforce security-related roles and rules.
Real-world examples of cloud governance benefits
The following real-world examples of how organizations use cloud governance demonstrate its value. Organizations of all types and sizes can achieve these benefits.
Virtual machine management
Cloud governance improves cloud resource management when it is applied as automated policies within cloud environments to manage virtual machines (VMs). The benefits that the automation of cloud governance policies bring to virtual machine management include:
- Shutting down unused VMs automatically to ensure that organizations only pay for the cloud resources they actively use
- Enabling better tracking and cost allocation by applying standardized tags to cloud resources to categorize them by project, department, or cost center
- Preventing unauthorized usage by implementing granular access controls to ensure only authorized users can provision and manage cloud resources
- Providing detailed insights into resource usage, helping organizations to identify and address potential areas of cost inefficiency
- Reducing unnecessary cloud spend by enforcing a cloud governance policy that defines a specific time limit for VM inactivity, triggering an automated action to stop the VM if it remains idle beyond that time frame
Reduces shadow IT
Cloud governance makes resources more accessible, which encourages users to work within the established structure to procure cloud services. This reduces the use of non-sanctioned cloud resources and helps reduce the use of shadow IT systems. Cloud governance supports efforts to control shadow IT usage by providing policies for:
- Access controls and usage to ensure that employees only utilize approved services and features within the cloud environment
- Data storage on the cloud, including retention periods and access controls to prevent employees from storing sensitive information on personal cloud storage services
- Cloud usage monitoring to identify potential shadow IT activities and alert IT teams to investigate and address any unauthorized usage
Recommended cloud governance next steps
Cloud governance should be embraced as a logical extension of general IT governance. While many of the principles of IT governance apply to cloud governance, they are not the same. Cloud governance goes beyond general IT governance to account for the expansive nature of cloud computing.
It is also important to remember that cloud governance also plays an integral role in minimizing cloud security risk by augmenting basic IT security practices. By establishing and enforcing rules, cloud governance can improve data protection, integrity, and availability.
Organizations should use cloud governance to extend IT and security controls across all systems to protect information no matter where it resides. With the growth of cloud computing, it is imperative that organizations take time to rethink general IT governance and incorporate best practices for cloud governance.
