A roadmap to efficient cost management with FinOps

The more companies use the cloud intensively, the more complex it becomes to control and manage costs. FinOps comes to the rescue: it is the acronym for “financial management” and “operations” and suggests that all teams collaborate in decision-making to leverage the true value of cloud investments.

A leading consulting firm identified that 39% of organizations consider cost optimization a challenge after migrating to the cloud. The same report identified that businesses without mature FinOps capabilities waste up to 30% of discounts. And that 32% of all cloud costs are the result of a lack of best practices on the part of users.

In the same line as the rest of the “Ops” practices (such as DevOps, DataOps, LLMOps or MLOps), FinOps seeks to integrate different perspectives and for the different areas of the company to share tools and a language. The goal is to break down barriers and bring the entire organization into alignment to manage cloud costs.

The first step towards FinOps: Analysis of the situation

Cloud usage is increasing in enterprises and, as a consequence, the bills are getting bigger and bigger. Moreover, it is a democratized technology: different teams have facilities to generate and consume new services according to their needs. The old days when requirements were concentrated in the IT area are over.

The first step towards a FinOps model is to understand where the organization stands: analyze the maturity in the use of the cloud, the visibility that multiple consumptions have and the value that each of them brings to the organization.

The more companies use the cloud intensively, the more complex it becomes to control and manage costs. FinOps comes to the rescue: it is the acronym for “financial management” and “operations” and suggests that all teams collaborate in decision-making to leverage the true value of cloud investments.

A leading consulting firm identified that 39% of organizations consider cost optimization a challenge after migrating to the cloud. The same report identified that businesses without mature FinOps capabilities waste up to 30% of discounts. And that 32% of all cloud costs are the result of a lack of best practices on the part of users.

In the same line as the rest of the “Ops” practices (such as DevOps, DataOps, LLMOps or MLOps), FinOps seeks to integrate different perspectives and for the different areas of the company to share tools and a language. The goal is to break down barriers and bring the entire organization into alignment to manage cloud costs.

The first step towards FinOps: Analysis of the situation

Cloud usage is increasing in enterprises and, as a consequence, the bills are getting bigger and bigger. Moreover, it is a democratized technology: different teams have facilities to generate and consume new services according to their needs. The old days when requirements were concentrated in the IT area are over.

The first step towards a FinOps model is to understand where the organization stands: analyze the maturity in the use of the cloud, the visibility that multiple consumptions have and the value that each of them brings to the organization.

Planning should include identifying pain points (e.g., lack of visibility into cloud consumer costs) and KPIs to measure the FinOps function.

The importance of sponsorship in FinOps

To make progress in a FinOps strategy, it is essential to identify a business-level sponsor. Leaders interested in lowering costs within their operating unit.

Also, early adopters in smaller teams that help to quickly implement this methodology may be needed. In fact, an excellent way to introduce the FinOps concept in an organization is through a small team. They can achieve results quickly and that value is then shown to implement the methodology transversally throughout the organization.

FinOps socialization for adoption

Education and training of users is another key piece: everyone in the organization should understand what it is, what restrictions it has and what its objectives are.

One company, for example, designed a contest with prizes for the team that was able to lower costs and increase efficiency the most. An excellent idea to promote FinOps within the organizational culture.

Next, the FinOps model must be defined, including the operating model, resources, cross-functional inputs and other key interactions.

Nubiral as a strategic partner for the journey to FinOps

Nubiral has the talent, knowledge and experience to accompany organizations throughout their FinOps journey. From implementing the capabilities to ensuring their proper use.

We know that each company has its own needs and that there is no “silver bullet” that solves all problems. That is why we provide customized help that takes into account the business context and its objectives.

Conclusions: The benefits of FinOps

The main benefit of FinOps might be that it avoids surprises in the invoices linked to the cloud infrastructure. Thanks to its implementation, it is possible to gain efficiency, even with moderate efforts.

Then, they highlight the control and visibility of the operational management of the cloud. This leads to a reduction of expenditure to its minimum. It also offers the peace of mind that each expense has a corresponding budget allocation. Moreover, it takes better advantage of annual or semi-annual discount offers or enterprise agreements with cloud providers.

But perhaps most importantly, it consolidates cost and infrastructure management as part of the company’s culture. FinOps ultimately promotes greater accountability and sustainable results for the future.

Interested in starting to spread the FinOps culture in your organization? Our experts are waiting for your call: Schedule a meeting!