Companies are moving their computing capacity to the cloud to benefit from the fact that the systems are managed (outsourced) by a 3rd party e.g., AWS, Azure, Google cloud etc. Efficient architecture is always the focus, however, due to a rush or uninformed decisions, various companies have been in a position where the spending on cloud services was too high. The amount spent on the cloud is sometimes that high that the choice to migrate to the cloud is disputed… Therefore, step 1 in the process of reducing the costs is analysing the existing expenditure on the cloud (inform). Step 2 is to
optimize these costs, which means that the unneeded resources will have to be eliminated. Also, the teams should be now more aware of how to use the cloud services and what costs are involved. Step 3 is to operate and always be thoughtful of the ups and downs of each cloud service (operate).
This is known as the FinOps lifecycle. FinOps i.e., Financial Operations is the intersection of people, process, and technology as it relates to managing the financial operations of a business. FinOps is a culture and can be followed or adopted by considering factors such as the following principles:
What are we aiming for? The most important concept is
unit economics. We should always measure our cloud spend against
a business metric e.g., total revenue, shipments made, paid subscribers, customer orders. This is a complex process!
We have explored FinOps, the concept, what are the pros and cons. We saw the lifecycle, the core principles, and factors. Now that we also know who FinOps is for, we can start talking to them about the topic and chase at reducing cloud costs! Customers will also appreciate the reduction of cloud expenditure and any costs to be more generic!
I’m a Senior Consultant at Net Reply UK. I like writing about various automation topics, from technical to more abstract. My team in Net UK consists of consultants, software developers, technology enthusiasts specialising in Telecommunications and technological concepts such as Software Defined Networks (SDN), Network Function Virtualisation (NFV), DevOps. Our mission is to build the Next Generation Networks leveraging the art of software and latest technological trends. If you would like more information, feel free to reach out to me
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