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An organization discovers that development teams are frequently deploying oversized and expensive virtual machine (VM) sizes in their test subscriptions, resulting in cloud budget overruns. The IT governance team wants to proactively prevent users from provisioning any VM sizes outside a pre-approved list of cost-effective SKUs.
Which Azure service or feature should the organization implement to enforce this restriction?
Azure Policy is a cloud governance service that evaluates resources in Microsoft Azure by comparing their properties to business rules defined in JSON format. It allows organizations to enforce standards, achieve compliance, and guard against unintended costs across subscriptions and management groups.
By assigning the built-in Allowed virtual machine size SKUs definition through Azure Policy, administrators can explicitly define an allowlist of permitted VM sizes (such as standard B-series or general-purpose SKUs). When a developer attempts to deploy a VM size that is not on the allowed list, Azure Policy evaluates the request during the ARM deployment phase and immediately denies resource creation, proactively preventing budget overruns.
Unlike passive monitoring tools that notify administrators only after charges have already started, Azure Policy acts as an automated guardrail at the deployment layer. This makes it the most effective governance mechanism to restrict VM sizes and control infrastructure spending.
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