The Hidden Costs of CPU Consumption

Central Processing Unit (CPU) consumption is essential to IT as well as your business, working as the heart of your system as it executes instructions across applications. But the more CPU your business uses, the bigger impact it has on your costs.

While CPU availability is necessary for operations, excessive consumption can hurt your budget and make your business less efficient. In this article, we explore the impact of hidden CPU costs, where they're likely occurring, and how your business can mitigate increases effectively.

The Impact of Excessive CPU Consumption

Every organization wants efficient operations and maximum productivity, but when it comes to CPU consumption, excessive CPU usage can lead to several business challenges.

Energy Costs

One of the main expenses associated with CPU consumption is energy costs. As your CPU works to process instructions, it consumes lots of power, resulting in bigger electrical bills. If left unchecked, this excess consumption can drive up energy costs and operational expenses.

Hardware Maintenance

CPU-intensive workloads can put a strain on hardware components, leading to down-the-line equipment failures. Maintaining or replacing these components not only adds to your organization's costs, but it also affects productivity as systems are taken offline for repairs.

Insufficient Resource Utilization

Excessive CPU consumption can often lead to inefficient use of resources. When your system is overloaded with processing tasks, it can struggle to keep up, resulting in slower performance and the potential for system crashes. When this happens, your business may end up paying for more hardware than is truly required.

Uncovering Your Hidden CPU Costs

Now that we’ve covered the implications of excessive CPU consumption, it's crucial to identify where these hidden costs are arising. Often, these high CPU costs lurk in areas that are unexpected or are hard to pinpoint.

Monthly License Charges (MLCs)

If your business uses a mainframe, then you're very familiar with the Monthly License Charge (MLCs) pricing model, which bases costs on peak usage of mainframe software. The more CPU resources your mainframe consumes, the higher your MLC costs.

When it comes to MLCs, even a slight increase in CPU usage can result in big bills for your business. If your organization relies heavily on mainframe technology, it's important to be aware of this hidden cost and take steps to optimize CPU usage – or risk paying a hefty sum every month.

Capacity Upgrades

Another hidden cost of CPU consumption is the need for capacity upgrades. As your business grows, it's natural to require more computing power to keep up with increasing demands. However, if your organization is already using a significant amount of CPU resources, you essentially have two options:

• Optimize CPU usage to delay or even avoid expensive upgrades
• Upgrade your system to handle the additional workload by investing in more powerful hardware

Upgrades like these come with direct costs like purchase and installation, and indirect costs like downtime and staff training. But if capacity issues are causing budget problems, these costs should be part of your overall consumption strategy.

Outsourcing Costs

Outsourcing IT operations is a common solution for businesses looking to reduce operational costs. However, if your organization's CPU consumption is not optimized, outsourcing may not be the solution to achieve the full cost reduction you're expecting.

Outsourcing companies often charge based on the number of resources used and the complexity of the tasks performed. This means that if you're using higher-than-average CPU consumption, you're likely to pay higher outsourcing costs. And if your organization's CPU usage is not optimized, you may end up paying even more for the same tasks as compared to handling them in-house or with a more skilled partner.

If you need a partner to provide a solution, your organization's best bet is to optimize CPU consumption first to see if it addresses your budget issues, before considering outsourcing. This exercise will ultimately lower your outsourcing costs, should you choose to pursue a managed services approach.

IPLA Software

Another area where hidden CPU costs can arise is with IPLA (International Program License Agreement) software. This type of software is licensed based on the capacity of your organization's mainframe, which includes CPU usage.

If your business's CPU consumption increases due to inefficient or excessive workloads, you may end up paying for more IPLA licenses than necessary – and it may even be software that your organization doesn’t fully utilize.

If your organization is using IPLA software, regularly monitor CPU usage to ensure you're not overspending on unnecessary licenses.

Performance Costs

Aside from the direct costs associated with excessive CPU consumption, there are also indirect costs related to performance that can impact your organization's bottom line, including:

• Downtime: When systems crash due to an overworked CPU, it can mean costly downtime for your business. During these events, customers and employees may be unable to work, impacting productivity and potentially causing lost revenue.
• Poor performance: As mentioned earlier, high CPU consumption can lead to slower system performance. This not only affects productivity but can also impact customer satisfaction and retention.
• Negative impact on reliability: When systems are constantly running at near-full capacity, it increases the likelihood of equipment failure, resulting in unexpected maintenance costs and potential data loss.
• Opportunity costs: High CPU consumption can also lead to missed business opportunities. For example, if a website performs slowly due to excessive usage, potential customers could leave without completing a transaction, which means your business lost revenue.

Strategies for Reducing CPU Consumption & Costs

Given the significant impact of CPU consumption on your organization's expenses, finding effective strategies to mitigate these costs is critical. Here are some different approaches your business can take.

Load Balancing

Load balancing involves distributing workloads across multiple computing resources to prevent system overload. By ensuring no single CPU is overwhelmed, you can enhance performance, avoid system lags or crashes, and extend the lifespan of your hardware.

Upgrading Hardware

Implementing more effective or efficient hardware is another strategy. Modern CPUs often provide better performance per watt, making them more energy efficient. While this requires an upfront investment, it can lead to significant savings in the long run.

Software Optimization

Optimizing your software can lead to more efficient CPU usage, but it might include refining code, eliminating unnecessary processes, or using more efficient algorithms. Yet, despite the complexity, it can often lead to reduced CPU load and, consequently, lower operational costs.

Implementing Energy-Efficient Practices

Adopting energy-efficient practices such as virtualization and server consolidation can help reduce your overall power consumption. Doing so enables a more efficient use of resources, reducing the need for extensive hardware while also lowering energy costs.

Capacity Planning

Effective capacity planning can help your business predict its resource needs and plan accordingly. Ultimately, this helps prevent over-provisioning, where you might invest in more hardware than necessary, and under-provisioning, where you have fewer resources than you need. Striking the right balance can reduce wasted resources and help ensure efficient system performance.

Lower costs and better performance are on every IT leader's wish list right now. And with the right CPU optimization strategy, it's possible to achieve both. By proactively managing and monitoring your organization's CPU consumption, you can minimize costs, avoid downtime, and maximize performance – or in other words, create a more efficient and profitable business.

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