A cloud financial management or FinOps practice can maximize the value of the cloud. It is a collaborative discipline where all stakeholders take ownership of their cloud usage with support from a central best practices group.
A strong FinOps practice incorporates the 5 Cs of FinOps.
Let’s talk about the third C of the 5 Cs of FinOps: centralized team.
When hearing "centralized team," leaders may question what implementing FinOps will cost. This is a fair concern. However, every organization will answer differently. In some organizations, FinOps may be a functional role, while others will require a team that is 100% dedicated to the practice.
The common thread is the reach that this team will have. It is very uncommon that finance, IT, procurement, DevOps, and SecOps are already on the same page.
In an ideal state, the FinOps team will work with the change sponsors to evangelize the practice across every function. The FinOps team should influence all individuals who spend in the cloud. Depending on the size and complexity of your organization, this may be a long-term goal.
SoftwareOne's FinOps Starter Pack has helped dozens of enterprises begin their cloud financial management journey. The first step in the Starter Pack is holding workshops with stakeholders from different teams to identify gaps in their current strategy and prioritize areas that require attention.
We have interviewed hundreds of people during these workshops and found that respondents, on average, disagree with the answers to 55% of cloud-related questions. It is impossible to succeed with FinOps when groups do not have alignment around the cloud and how it can help them achieve your organization's goals.
When teams work in silos, you won't realize the full benefits of the cloud. You'll also lack a holistic view of your spend and usage—making it impossible to maximize the value of your cloud investments.
Succeeding with cloud financial management requires a centralized FinOps team. You don't necessarily need to hire new people when you form this group.
Instead, build a sense of ownership among your existing teams by bringing the following stakeholders together in a functional FinOps group.
You can also bring in FinOps experts to help you establish, manage, and maintain your program without investing in dedicated, full-time employees.
According to the FinOps Foundation, the average FinOps team has seven people. However, the number isn't as important as ensuring that all your stakeholders have representation.
Every stakeholder should have time to discuss their current and future initiatives. For example, engineers and developers can bring their roadmaps to your FinOps team. Then, your FinOps team can help leaders define KPIs based on their business, financial, and technology goals. When everyone aligns around a shared vision, you can communicate more effectively and make FinOps a priority across your organization.
Building a cross-functional FinOps team allows you to create efficient feedback loops and allocate direct and shared costs appropriately. Doing this will give you visibility into your cloud spend and enables variance analysis while holding teams accountable for waste.
For example, you can see if a development team fails to turn off services that are not in use. You can also work with engineering to identify static workloads that would be more cost-effective as reserved instances.
Developing a cloud financial management or FinOps practice can help you better manage cloud spend
Developing a cloud financial management or FinOps practice can help you better manage cloud spend
