Written by Dor Danosh, FinOps Leader at Commit
How do you know you are making the most of the cloud?
You could set up resource monitoring tools or cost management tools. You could compare between different vendors or rely on their pricing calculators. You could even use a fancy TCO calculator to see how much it would have cost had you not been cloud native.
But that doesn’t provide the answer you really need. Today, with so many services, infrastructures and tools offered on the cloud, by AWS, Microsoft and other providers – how do you know you are utilizing the right ones for your business needs? The answer, in one word, is FinOps.
FinOps (abbreviation of Financial Operations) means actively responding to actual demand and matching it with the best possible cloud solution, whether infrastructure or service. FinOps experts establish clearly understandable and accepted metrics for your organization to provide you with regular, ongoing actionable items and reports. These tools and reports not only help control costs but also mean you rapidly respond to consumption and to market changes, even at the architectural level.
FinOps reviews cover many aspects of your cloud solution, to make sure your organization is making the biggest bang for your buck. The three steps of FinOps are Inform, Optimize and Operate.
Inform: In the first step, we gain visibility into your business logic and cloud assets and operations. This also includes aspects of budgeting, alerting and forecasting. For example, customized dashboards are created, and alerts are set up in line with your budgets – even per sub-unit.
Optimize: In the second step, we look at your cloud footprint and make complex calculations to ensure right-sizing is done automatically, even turning off wasteful resources. When setting up cost-optimization reports, the recommendations may include decreasing the size of your database and instances or setting automatic startup/shutdown schedules.
Operate: In the last stage means you have achieved a maturity of continuous improvement, including customized KPIs for your business logic, governance and compliance. This requires FinOps to know how to talk with each of the relevant figures in your organization – from finance to DevOps, from front-end developers to management. Customized KPIs need to match your app, your business logic and even your organizational culture. For instance, in a billing system, the cost per data per user can be collected for usage in intelligent business forecasting.
Going through all three steps means you avoid bill shock. You know not only what you are paying for but also why.
In summary, there is no question whether you need to be thinking of financial operations – the question is just how. FinOps experts review your system, examine the crucial aspects of your app and infrastructure, and suggest intelligent improvements. All these are so you can save wisely on costs across your cloud services, even up to 60% of your consumption costs! With the complexity of the cloud, FinOps means a safe and cost-efficient cloud journey – every step of the way.