How to adopt FinOps principles at your company

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Bare metal, private and public clouds are different not only in a way how your resources are provisioned and maintained, but in a way your procurement and financial departments should treat and deal with them.

Bare metal and private clouds in the majority of the cases are about CapEx, when companies purchase and upgrade hardware and software licenses in some cycles, lease space and power, and pay salaries to personnel. Public clouds are based on OpEx with monthly or annual bills and a mindset of leasing but not owning. If you are a small company, it’s not a big deal to adjust your processes, but for a huge company it’s a real pain: private clouds with CapEx, public with OpEx, engineering teams provisioning resources in multiple locations and without any limits in public clouds transforming into enormous bills, financial departments having on-premise and public resources and different accounting categories. All this is a big obstacle for cloud adoption across big companies and the reason they still prefer not to go hybrid cloud.

To eliminate the barrier, FinOps methodology was created and is actively developing nowadays with thousands of practitioners and enterprise companies as members and sponsors.

FinOps is a process and a set of best practices to bring the following aspects to companies and stakeholders:

  1. Visibility  cloud spending transparency and forecasting
  2. Optimization  cloud expense optimization
  3. Control  an established process of monitoring and controlling cloud resources and their expenses
  4. Collaboration  FinOps is not about one person at a company but a constant collaboration between engineers and their managers, between R&D, Operations and Financial departments, CTO, CIO and VPs offices.

Here is a list of people (but not limited to just those positions) engaged in the FinOps process: CTO, CIO, VPs and Directors of Engineering / Ops / DevOps, CFO, financial controllers and analysts, Engineering managers, project managers and, of course, engineers who work directly with clouds.

Before we discuss the steps to adopt FinOps, let’s define the end goal — it is to build a transparent and defined process, when clouds are used in an optimal way from cost, performance, R&D and company goals perspective and money waste are set to minimum.

What needs to be done to build the FinOps at your company:

FinOps is a new term and the community is just developing but it’s the right move to help big companies adopt clouds in a smart, secure and transparent way. Start small and you will see positive results soon.

Nick Smirnov, CEO and Co-Founder

Nick Smirnov, CEO at Hystax