4. Decisions are driven by business value of cloud
Once the FinOps team members have been selected, they need to make decisions that tie the value of the cloud to the organization’s business goals. As part of this process, this team will also analyze costs, develop benchmarks that drive best practices, and determine the overall performance of FinOps efforts.
One way to begin developing performance metrics is by looking at the FinOps “Iron Triangle.” This model assesses tradeoffs and resource sharing opportunities against the categories of speed, cost, and quality. MSPs should also help their customers track cloud performance costs and improvements and tie them back to their impacts on business outcomes, such as customer satisfaction.
5. Take advantage of the variable cost model of the cloud
The cloud presents unique opportunities to your customers in terms of capacity planning. As their service provider, you can help customers make more informed decisions around cloud cost optimization and resource utilization to get the most out of their cloud investment.
MSP subject matter experts can help guide customers cloud purchasing strategies. The MSP’s centralized cloud volume buying power helps customers optimize discount purchase opportunities, such as committed use discounts (e.g., reserved instances, spot instances, and Savings Plans).
6. Reports should be accessible and timely
MSPs have a variety of cloud management solutions at their disposal and should generate reports from the data that these tools collect. Giving customers this information, in easily consumable reports, brings insight and visibility into their resource utilization and provides a fast, consistent feedback loop to drive efficiency in their cloud practice.
Cloud management tools give the MSP the ability to create and deliver reports in near-real time. These reports — which may be weekly, monthly, or quarterly — can break down cloud spend, cost allocation, resource utilization, security and compliance data, and more. The appropriate cadence for reporting and accessibility may be based on industry best practices as well as customer needs. MSPs should survey stakeholders on a periodic basis to ensure that reporting addresses business needs and provides actionable recommendations.
Crawl, Walk, Run
Of course, applying these FinOps Principles will be different depending upon where your customers are in the FinOps journey. The FinOps Foundation rates the maturity of a FinOps practice according to three stages: Crawl, Walk, and Run. It’s important that MSPs conduct this assessment first to determine what guidance the customer needs in implementing, maturing, and optimizing their FinOps practice.
At the Crawl stage, engineers may not be familiar with FinOps and how they can play a role in it. Leadership may not yet see the value of FinOps yet either. In this early stage, the MSP can help bridge the gaps between finance and engineering to ensure collaboration.
At the Walk stage, leadership understands the importance of FinOps and makes decisions based on the FinOps Iron Triangle. Engineering and Finance are aware of each others goals and actively engage in FinOps processes. However, stakeholders may see FinOps metrics as “just another operational metric,” according to the FinOps Foundation. MSPs can help customers incorporate FinOps methodologies into wider business goals.
Finally, at the Run stage, the organization’s FinOps practice has reached an advanced level of maturity. Engineers consider the financial impact during each life-cycle and actively look for FinOps opportunities. MSPs can support customers in this stage by ensuring that they continuously monitor and optimize their cloud financial performance.
Thinking Beyond the FinOps Frameworks
“A framework is one thing,” said our recent webinar guest Benjamin van der Maas, Cloud Financial Management Practice Lead at Cloudar and founder of the FinOps Alliance. “How you do it in the real world, how you bring it into practice, that’s another thing.”
Watch our latest webinar on the Six Principles of FinOps to learn how Cloudar embraces FinOps and how the FinOps Alliance is bringing real-life FinOps experience to the table.