How to convince your organization to adopt FinOps
Increase cost efficiency and innovation by persuading your organization to embrace FinOps practices. Elevate your financial game today.
If you’re a parent, sibling, friend, or an employee. You already know how difficult it can be to get a child, your stubborn brother, skeptical friend, or busy boss to do anything you ask them to. You might find that many times it doesn’t matter what facts you present either. To get somebody to shift from 0 to 1, from inaction to action is a very difficult thing indeed. There are countless books written on the art of convincing and persuasion. They can be hard skills to pin down but Dale Carnegie and Robert Cialdini have a few tips for you, and since these authors have already written eloquently on these topics, I will shift the focus slightly in this article.
This article is not an attempt to build on the literature of persuasion. We are going to approach the subject in a more pragmatic way by imagining a few different managerial styles and the 6 different ways to approach the subject of adopting FinOps practices at your company depending on the type of manager you have to persuade.
The Cloud FinOps bullet points 👇
Cloud FinOps, is a set of practices and principles that help organizations manage and optimize their spending on cloud services like Amazon Web Services (AWS), Microsoft Azure, or Google Cloud Platform (GCP). Think of it as a way to keep track of and control the money you spend on cloud resources, just like you would manage your household budget.
In short, Cloud FinOps practices are like money-saving tips for using cloud services:
- Budgeting: Set spending limits.
- Optimization: Use resources efficiently.
- Cost Allocation: Assign costs to projects.
- Continuous Improvement: Keep finding ways to save.
💡 Now we are going to need to tailor the conversation to each manager
Let’s meet the managers 👋
The data-driven manager: Data David 📊
💡 Here are some of the statistics that should inform the conversation and sway the conversation with a more data-driven manager.
The FinOps stats:
- Cloud spending to reach nearly $600 Billion in 2023 (Source: Gartner)
- Cloud costs are higher than expected for 6 in 10 organizations (Source: CloudZero)
- 71% of organizations expect their cloud spending to increase (Source: Flexera)
- 32% of a cloud budget went to waste (Source: Flexera)
- 75% of organizations report an increase in cloud waste (Source: StormForge)
- 7 out of 10 companies aren't sure what they spend their cloud budget on (Source: CloudZero)
- At least 30% of organizations need to master shared and untagged costs in the cloud (Source: FinOps Foundation and CloudZero)
Considering that 7 out of 10 companies are uncertain about their cloud spending, it might be beneficial for David’s organization to set up alerts to monitor his expenses. Similarly, he should regularly review his AWS bill. With statistics showing that 32% of the cloud budget is wasted on underutilized or idle resources, David should ask himself: How many of these services am I familiar with? Am I optimizing my resources efficiently? How do I know what percentage of the budget is being wasted from month to month?
The “straight-shooter” manager: Bullet point Bea 🎯
💡 If your manager doesn’t have time for lengthy presentations or meetings, share with her the following bullet points, which are the main reasons for considering adopting FinOps practices.
- Cost Optimization: Cloud FinOps helps companies optimize their cloud spending, reducing unnecessary costs and maximizing the value of cloud resources.
- Resource Efficiency: It enables efficient resource allocation, ensuring that cloud resources are used effectively and scaled based on actual demand.
- Budget Control: Companies can gain better control over their cloud budgets, preventing unexpected overruns and aligning spending with financial goals.
- Data-Driven Decision-Making: Cloud FinOps relies on data analysis to inform decisions, allowing for informed choices on resource provisioning and cost management.
- Scalability: It supports easy scalability, enabling companies to adapt to changing business needs without incurring unnecessary expenses.
- Improved Accountability: Cloud FinOps practices promote accountability by assigning costs to specific teams or projects, fostering a culture of responsibility.
- Competitive Advantage: Embracing Cloud FinOps can give companies a competitive advantage by ensuring they are agile, cost-effective, and able to innovate without financial constraints.
The overly trend-averse manager: Harry “no-hype” 🙅
💡 We all know this type of mindset, any new tool, process, or concept that’s introduced is met with skepticism. This isn’t a bad thing necessarily because there are some fads and trends at any point in time that you should do your best to avoid. But if your manager rattles off any of the sayings below, try to dig a little deeper and find out what will move their opinion, is it examples of successful use cases? A data-based argument? regardless in this article, you will be able to find the resources you need to sway your manager's opinion to at least give FinOps a chance. The effort will pay off because FinOps is anything but a passing trend.
- "It's Just Another Buzzword"
- "We Already Have Cost Controls in Place"
- "We Don't Have the Resources"
- "We're Too Small for This"
The tools-oriented manager: Timmy tooling 🧰
💡 You might have to deal with a manager who is curious and interested in leveraging the newest tools to take current problems if that’s the case.
An OSS multi-cloud cloud transparency tool, natively integrating with the major cloud providers (AWS, Azure, GCP, OCI…). Komiser makes it easy to fetch, filter, and sort your cloud resource inventory spread across the full expense of your multiple cloud accounts and environments. With a thriving community of contributors, constantly delivering new features and improvements.
The enterprise version of Komiser, Tailwarden combines cloud transparency along with granular cost insights. Leverage its tag audit feature to keep a close eye on the correct application of your company-wide tagging policy. Use the custom range filter in the cost explorer to pinpoint time-specific cost events. Get daily digests sent directly to your email and per-resource cost breakdowns.
The use-case oriented manager: Use-case Casey 💎
💡 There are early adopters and then there are others who need to see it to believe it, if your manager is in the latter camp then introduce her to the incredible stories of FinOps success below.
The Wildlife Studio case:
The Wildlife Studio was able to reduce its EC2 costs by 45% by reviewing its usage and mapping it to the right instance usage (on-demand, spot, or reserved instances).
The MicroStrategy case:
MicroStrategy relied on AWS Cost & Usage Report and services including Amazon EC2 Reserved Instances to optimize AWS usage leading to a cut in cloud spend by 30 percent and saving $250,000 annually.
The Lyft case:
Lyft Uses AWS Cost Management to Cut Costs by 40% in 6 Months.
The hold my hand manager: Stevie small steps 🪜
💡 If your manager just needs you to spell it all out, then below you'll find a comprehensive step-by-step plan that can be put in place to implement the initial framework for your FinOps strategy.
Conclusion: FinOps is a habit, not a task.
The statistics are clear. Cloud spending is on the rise for most companies, and without effective management, budget waste is inevitable. Cloud FinOps isn't just another set of tedious financial meetings, it encompasses proven practices and methods for optimizing processes, empowering organizations to become proficient budget stewards, and fostering their growth.
No matter who your manager may be, this article will provide you with reasons to explore the adoption of FinOps practices within your company. However, it's crucial to remember that the primary goal here isn't simply to persuade and ensure your ideas prevail. Achieving success in FinOps hinges on a critical element: collaboration. To become a true FinOps success story, your company must foster involvement, alignment, and active listening among all its teams. As Adam Jacob, CTO at Systems Initiative, aptly stated in a recent Arrested DevOps episode, the defining factor that sets companies apart in the age of cloud is the extent of intra-team collaboration. Keep this in mind as you embark on your FinOps journey.