What is a good first goal in the Optimize phase?

• A. Real-time anomaly detection
• B. Increase budgets
• C. Good cost allocation
• D. Plan for next year

Answer: (C)

Focusing on cost allocation first. In the Optimize phase, the foundation for effective cost control is knowing exactly who or what is driving spend. When costs are allocated to teams, projects, or services through tagging and chargeback/showback, you gain clear visibility and accountability. That clarity lets you pinpoint where to take action—rightsizing oversized spend, eliminating idle resources, and choosing the right purchasing options for each unit. With accurate allocation, you can measure the impact of every optimization action and ensure savings are real and attributable.

Real-time anomaly detection is useful for spotting unusual spend, but it depends on having proper cost allocation to attribute the spike to a specific resource or owner. It’s a monitoring tool, not the starting point for optimization. Increasing budgets runs counter to optimization goals, since the aim is to spend more efficiently, not more. Planning for next year belongs in budgeting and strategy phases, not the immediate optimization work.