FinOps is the practice of bringing financial accountability to the variable spend model of the cloud, enabling distributed teams to make business trade-offs between speed, costs, and equality. Within FinOps there are three phases:
Empower your organization and teams with information on visibility, allocation, benchmarking, budgeting and forecasting. The on-demand and elastic nature of the cloud, along with customized pricing and discounts, makes it necessary for accurate and timely visibility for intelligent decisions. Accurate allocation of cloud spending based on tags, accounts or business mappings enables accurate chargeback and showback. The business, but also the financial stakeholders, want to ensure they are driving ROI while staying within budget and accurately forecasting spending, avoiding surprises. Benchmarking as a cohort and against teams provides organizations with the necessary metrics to develop a high-performing team.
Cloud providers offer multiple levers to optimize e.g. on-demand capacity or offering of discounts for commitments which typically involve complex calculations for making reservations. In addition, teams and organizations can optimize the environment by rightsizing and automating turning off any wasteful use of resources Continuously evaluating business objectives and the metrics they are tracking against those objectives, and how they are trending,
Continuously evaluate business objectives and the metrics they are tracking against those objectives, and how they are trending, e.g. measuring business alignment on speed, quality, and cost.
Any organizational success is only possible if the organization can operate in a culture that involves a cloud Cost Center of Excellence built around business, financial and operational stakeholders who also define the appropriate governance.
To quote Peter Drucker “Culture eats strategy for breakfast”: FinOps is a cultural practice and it is the way for cross-functional teams to manage their cloud costs by taking ownership of their cloud usage. The culture of your organization always determines success regardless of how effective your strategy may be. No matter how detailed and solid your strategy is, if the people executing it don’t nurture the appropriate culture, your projects will fail.
Being a sustainable organization
Single-use plastic. Car pollution. Fast fashion. Most of us have some idea of what’s wrecking the environment. But there’s another glaring and rapidly growing environmental polluter on the planet: Data Centres. Those constantly processing computers that make our life in the cloud so
ubiquitous, also have a bigger carbon footprint than the aviation industry, while the ones that support Bitcoin are on track to boost global warming above 2°C in just two decades.
Everything we do on the Internet (every click, search, or stream, each piece of data, even taking a photo on our phone) is matched by a piece of energy. So while it might seem like the cloud is a vague, weightless place propping up the wireless world and existing away from the reality of a hard drive, there is (of course) physical cloud infrastructure, somewhere. Whether it’s for sending emails, uploading files or playing games, using anything related to the cloud still means computer servers, mostly housed in massive data centers, are set to work. Data Centres need 24/ 7 electricity to power the servers, storage, and backup equipment, as well as keep everything cool.
With the execution of the 5(+1) ways, you are closer to being able to be a sustainable organization.