Cloud infrastructure offers speed, agility, and flexibility. It allows organizations to expand capacity whenever needed to handle surges in demand. And it enables software engineering teams to deploy resources quickly, making it easier for them to develop new products and features faster than ever before.
What makes the cloud so beneficial also creates one of the most difficult challenges for modern organizations: cloud financial management.
Left unchecked, cloud resources can expand and become unwieldy, leading to inefficient use of resources, overspending, and lack of return on investment.
FinOps—a methodology documented and matured by the FinOps Foundation in 2019—has become the operating model for the cloud, representing a combination of systems, best practices, and culture to increase an organization’s ability to understand cloud costs and make tradeoffs.
FinOps practices strive for an agile approach to cloud financial management with a focus on empowering software engineering teams with ownership of cloud usage, while also delivering real-time cost management data back to the business for quick decisions.
Making better decisions about the use of cloud resources requires transparency. You need to see what resources you’re using, who is using them, and why before you can make informed choices. FinOps begins by providing better visibility of cloud resources through resource tagging and then mapping those resources to business units, so you can show the business unit leaders what they are consuming and ensure they are getting the value they expect for their spend.
Cloud infrastructure allows to you to expand capacity at will. But there’s a cost for it. With the high cost of on-demand capacity, FinOps seeks to optimize the use of cloud resources through increased visibility, advanced planning and forecasting, rightsizing workloads, and smart use of Reserved Instances (RI) and Committed Use Discounts (CUD) to take advantage of commitment discounts offered by major cloud providers.
A core principle of FinOps is to increase collaboration between IT, finance, and business stakeholders, so better decisions can be made about cloud investments. The overall goal is to align cloud consumption with business objectives and drive agile service delivery in the cloud, while ensuring the organization makes the best use of its cloud spend.
FinOps is a continuous operating cycle, with organizations operating at various points throughout the process, depending on the complexity of their cloud workloads and their maturity level. The FinOps Foundation defines these points as three phases: Inform, Optimize, and Operate. Regardless of where you are in your FinOps journey, ePlus can help.
ePlus Cloud Consulting Services guide you through the core constructions of an optimized cloud, including accurate cost reporting via comprehensive tagging strategies, marketplace procurement governance, cloud commitment (RI) strategic planning, and ongoing resource optimization.