To succeed at FinOps, companies need to recognize key changes and adjust strategies as they move through different maturity stages. Let’s explore how this happens.
Reducing spending in the cloud via FinOps is a little like running a marathon. Runners encounter a range of different obstacles over the course of a long race. They start out by conquering what is arguably the greatest challenge of all – taking the first steps. From there, they need to prepare to climb hills, manage thirst, power through unexpected pain and so on. At all stages of the run, adaptability is key to reaching the finish line successfully.
Cloud cost optimization is similar in that the typical FinOps journey involves many distinct stages, some of which are harder than others. To succeed, businesses need to adjust their behavior and strategy on an ongoing basis.
How can an organization actually do that? How can companies adapt to the continuously fluctuating demands of FinOps? This article answers those questions by walking through some of the key changes and inflection points that businesses typically encounter over the course of their FinOps journeys and explaining how to succeed at each stage.
Change 1: Evolve your spending mentality
The first key change that businesses need to make to succeed at cloud cost optimization is simple: They must abandon a traditional data center mentality and replace it with one attuned to the unique nature of the cloud.
In other words, organizations must stop thinking of IT infrastructure as something that is fixed and rigid, as it is in conventional data centers. Instead, they should view infrastructure as a resource that is almost endlessly flexible and adaptable to changing needs. When you adopt this mindset, you are in a position to prioritize cost optimization whenever you make decisions related to cloud infrastructure.
Change 2: Modify your communication loop
FinOps success also hinges on adapting your organization’s communication strategy such that technical stakeholders – like the engineers responsible for setting up and configuring cloud resources – are in conversation with financial stakeholders, who understand what the business can afford to spend in the cloud and can track spending over time.
This adaptation, which goes hand-in-hand with the mentality change I described above, is critical because traditionally, technical people and finance people operated in siloes. But to thrive at FinOps, both teams must understand each other. Engineers need to understand the cost implications of the decisions they make, and finance teams must appreciate the technical needs of the organization so they can help engineers meet those needs in a cost-effective way.
Change 3: Make simple cloud spending changes
Once you have the right mentality and communication loops in place, you’re ready to begin making actual changes to reduce cloud spending.
The easiest way to get started here is to target changes – such as switching to Reserved Instances for cloud-based instances – that require relatively low effort, yet yield noticeable savings.
By starting small, you get quick wins that you can use to establish a positive feedback loop. Small changes prove that cutting cloud spending without compromising on performance priorities is possible, helping to achieve buy-in from stakeholders for further investment in FinOps.
Change 4: Hunt down and eliminate cloud waste
After winning small victories, businesses should adapt their FinOps strategies so that they can identify and remediate unnecessary cloud infrastructure, such as unattached EBS volumes or virtual machines that don’t need to be running.
This is a type of change that requires more effort than moves like switching to Reserved Instances because finding waste requires a comprehensive analysis of your cloud environment and technical needs. But when done properly, the elimination of unnecessary infrastructure helps to increase overall cloud savings. It also offers the benefit of simplifying cloud environments (because when you shut down extraneous resources, you have fewer objects to monitor and evaluate), which makes it easier to implement further FinOps changes down the line.
Change 5: Adjust your cloud architecture
When you’ve made the changes described above, you’ve reached a relatively mature stage on your FinOps journey. But there’s still room for more improvement in the form of changes to your cloud architecture strategy.
Here, I am referring to updates such as migrating to a newer generation of instance types, which can save money while maintaining or even boosting workload performance. Going further, you can even consider modifications like migrating workloads from virtual machines to containers – an initiative that requires significant effort (because it typically involves rewriting parts of the applications and learning new management tooling) but that leads to true cost optimization for some workloads.
Change 5: Make FinOps a continuous process
The final stage in your FinOps journey is to make FinOps a continuous and routine part of your operations. Rather than treating cloud cost optimization as a one-off process that you perform on a periodic basis, you should bake tasks like reviewing cloud spending metrics and identifying anomalies into an everyday activity.
When you do this, you achieve the greatest possible level of FinOps maturity. You also position your organization to react to new cloud savings opportunities as they emerge – which they will because workloads are always changing, and cloud providers are always rolling out new service offerings and configuration options. The only way to take advantage of new opportunities right away is to search for them constantly.
Conclusion: FinOps means continuous change
Ultimately, being good at FinOps requires, in part, being good at change. And while the typical organization finds change at least somewhat challenging, the nice thing about FinOps is that once you begin making even just small changes, you begin seeing results in the form of reduced cloud spending. That makes it easier to embrace bigger changes, which lead to more savings and set the stage for even greater changes as you continue your FinOps journey.