Tackling Three Leading FinOps Challenges

Owen Gan

By Owen Gan

The promises of Cloud are relatively well-known – instant, practically limitless capacity, making operations scalable with the press of a button. If your business objectives change or you need to respond to market fluctuations, you can decrease your consumption just as easily. It offers additional data protections, is simple to procure, and is geographically dispersed.

Yet often there are challenges when organisations try to capture the business value enabled by Cloud. The challenges encountered most frequently by Cloud practitioners coalesce into three main themes – visibility, team empowerment, and applying Cloud financial management, or FinOps, principles which go beyond public Cloud spend. Their discussion made clear that the key to solving for these requires a mix of best practices, proper tooling, and cross-functional business alignment to achieve operational efficiency – and realise the “promises” – of Cloud.

Challenge 1: Allocating costs for full visibility

Successful Cloud financial management is dependent upon the ability to visualise your Cloud cost and usage information. After all – if you can’t visualise it, how can you effectively manage it? To gain full visibility, it is critical to have the ability to categorise all public Cloud spend and usage.

Cloud cost management is complicated by the fact that Cloud costs are variable in nature and charged in a myriad of ways (in fact there are over 500 thousand different SKUs across the three major providers), which makes aggregating charges and understanding costs in a multi-Cloud environment extremely challenging. And without that ability, it is nearly impossible to measure the effectiveness of procurement decisions, and ultimately, the value Cloud brings to your organisation.

A recent survey by The FinOps Foundation showed that FinOps teams grew in size by more than double over the past 12 months – and are expecting team size to double again over the next year!

The foundation of industry-accepted best practices can then be supported by the right tool, which should automatically normalise detailed information from the vendor billing files, provide capabilities to map spend to organisational constructs, allocate container and shared service charges, and inform sound decision-making to improve the unit economics – and increase the business value of Cloud.

Challenge 2: Empowering teams & driving accountability

It  takes cross-functional understanding, support, and ownership to deliver an effective Cloud financial management practice.

While infrastructure procurement decisions are typically dispersed across engineering and DevOps teams, properly enabling them to take action is critical. The teams need  relevant insights and recommendations, along with  well understood workflows and a means to measure the ROI of actions taken. FinOps and DevOps tools used every day by engineers and developers should be integrated to  make seamless actioning recommendations and measure realised savings.

This is currently the  top challenge faced by FinOps teams, as highlighted by the State of FinOps report. It inspired our Apptio engineers to develop “Policy Driven Rightsizing,” a closed-loop integration with Jira Software and Jira Service Management that helps organisations manage the full lifecycle of rightsizing tasks.

Ensuring organisational alignment also requires leaders and operational teams to have access to relevant information wherever and whenever they need it. Cloud cost management and optimisation solutions must have customisable reporting capabilities, with the ability to surface or hide information based on role or permissions.

Apptio’s reports are easily shared, provide up-to-date data and analytics, and maintain granularity with full data retention across any time period to fully scale accountability across an organisation. Key Performance Indicators (KPIs) can be determined to provide a north star to decision-making that balances business objectives with infrastructure procurement decisions. Through this process, teams can agree on key trade offs – like when to accept higher costs to accelerate a revenue-generating activity – and readily report back on outcomes.

Challenge 3: Looking beyond IaaS

Cloud financial management is multi-faceted, and to address infrastructure as a service (IaaS) only ignores spend across key related areas. Financial management of a full Cloud ecosystem must also contemplate non-IaaS spends, like software as a service (SaaS) and on-prem commitments.

The FinOps practice can be applied across each of these elements and can bring together a holistic management perspective, but it must be supported by the right solution to help teams manage across these different environments. Apptio is developing  key innovations to address the various financial management needs and challenges of each of these Cloud elements, and better support our customers along their Cloud journey.

Late last year, we introduced Cloudability SaaS and Cloudability Shift, two new solutions that expand our Cloud financial management capabilities, and enable customers to analyse, optimise, and plan investments across the entirety of their technology portfolio, regardless of service type (e.g., infrastructure, platform, or software), provider, delivery model, or deployment destination (e.g., public Cloud, private Cloud, or on-premises).

The challenges of Cloud are continuously evolving and expanding but are far outweighed by the amazing feats teams are able to accomplish through its use. We are inspired by the stories of our customers, pioneering through unchartered territories to deliver the value of Cloud into their organisations, and unlock savings to fund new initiatives. Sign up for a free trial today to see how we can help you.

Owen Gan is the Regional Vice President of Southeast Asia, Apptio