FinOps is a framework and practice that businesses can use to maximize their return on their cloud investments. It brings together technology and finance teams to not just better manage cloud costs but also ensure that it’s delivering value to the organization.
As cloud estates have become more complex, gaining greater visibility, transparency and consistency can improve efficiency in terms of both costs and developer productivity.
FinOps is a way to bring together technology and finance stakeholders to better understand cloud costs and ensure investments are delivering value.
FinOps can ensure you’re getting the most value from your cloud investments.
FinOps typically requires structural and cultural change so teams can work more closely together. The success of FinOps depends on how well this is done.
FinOps is proving particularly useful to organizations with large or complex cloud estates, as it’s helping bring technology and finance decision makers together.
What is it?
FinOps is about making data-driven decisions to manage the business value of cloud. It does this by bringing together technical and financial stakeholders to cultivate better communication and greater transparency.
It is sometimes thought of as synonymous with cloud cost optimization, but it is actually something distinct: cloud cost optimization is about making your cloud spend more efficient and removing waste. FinOps can certainly help with that, but it is about more than just managing costs — it’s about finding ways of pushing your cloud investments to deliver greater value for the organization. In other words, cloud cost optimization is a somewhat defensive activity — FinOps is more offensive, pursuing new opportunities for growth.
What’s in for you?
At a basic level, FinOps can help you optimize your cloud spend; it can save you money. It can help you maximize business value of the cloud, enables data-driven decision making and creates financial accountability.
But beyond that, it can help you improve the way you extend, maintain and evolve your cloud estate by bringing technical and financial experts together. From a business perspective, this means you are in a much better position to be intentional in how you approach cloud, ensuring that you treat cloud as a key component in your wider business strategy.
There are technical benefits too — joined-up and clear decision making will undoubtedly help technology teams, making them more productive and effective. Greater alignment between business, finance and technology should ensure technology teams are getting the support they need to deliver for the organization.
What are the trade offs?
FinOps isn’t a quick technical fix — it’s a discipline or way of working. This means it requires changes to how teams work together. That isn’t always easy to do: you need the right culture to make FinOps effective. In some organizations it can take time to get this right before you can begin to implement FinOps.
Relatedly, it also requires new skills and capabilities. This means individuals will need to be open about learning new things, whether they’re technologists getting to know how finance works or finance staff learning about technology.
Finally, it’s important to remember that FinOps is an ongoing practice — it doesn’t fix an issue for you and then allow you to carry on. It requires commitment from everyone, leaders and practitioners alike.
How is it being used?
FinOps is being used in many different types of organizations to rethink the way they deal with the cloud. In particular it’s being used for cost and resource allocation, monitoring, forecasting and to improve governance and consistency in how the cloud is used. Ultimately, organizations can get value from FinOps in very different ways: what ultimately matters is cultural change and buy-in from all stakeholders.
