It is an operating model that brings financial accountability to variable spending in the cloud. It was previously called “Cloud Cost optimization”, “Cloud cost management ” and also “Cloud Financial Management”. Later termed as “FinOps”.
Using FinOps Tech, Finance, and Business leadership teams share the same language and processes so they can manage cloud spend while maintaining the velocity.
To operate at scale in the cloud something new is required as the old centralised control methods just aren’t working. You need a model that gives your teams a common language one gets them communicating so they can manage costs without sacrificing the flexibility and velocity. That’s the whole point of cloud. right?
FinOps Origin
“Intuit” and “Adobe” were the first adaptors of cloud who gave the first idea about financial management in the cloud which later become to be FinOps in 2012. Later Australian enterprises such as “Qantas” and “Tabcorp” started following this financial management culture.
This culture slowly started to spread its wings around the world as the accountability and financial management challenges increased at scale in every aspect of cloud territory.
Principles
It is a cultural practice which provides efficiency for teams to manage their cloud spend, where each team or member takes ownership of their cloud costs supported by best-practices group which is centralized. All the responsible teams and departments work together to enable quicker delivery, while at the same time obtaining more economic and operational control. Some of the core principles of FinOps are
- Collaboration of teams
- Cloud business value drives decisions
- Shared responsibility
- Reports visibility and accessibility
- FinOps is driven by centralized teams etc…
Methodology
This model consists three distinct phases
- Informed phase – It gives you visibility in the cloud cost, allocation and for creating shared accountability by showing teams what they’re spending and why
- Optimize phase – It empowers your teams to take the right optimization actions based on your goals
- Operate phase – It refines those shared IT, finance, and business leadership goals to focus and scale your operational efforts through continuous improvement by breaking down the silos between Teams
FinOps enhances the unit economics of cloud so you can double your usage without effecting your bill. With FinOps your team’s work together, optimize the speed, cost and quality of cloud, empowering them to truly govern cloud spending.
For more information: Cloud FinOps: Collaborative, Real-Time Cloud Financial Management
Leave a Reply