Google Cloud joined the FinOps Foundation recently, making it the first major cloud services provider to become a member of the two-year-old organization.
FinOps Foundation, a trade association for the advancement of cloud financial management, also recently released its State of FinOps report, which offers a snapshot look at how this space continues to evolve as practitioners must forecast cloud budgets, get engineers to take action, and deal with shared costs.
The foundation defines FinOps as cloud financial operations as well as cloud financial management to ensure institutions see the greatest return on investment in public cloud. One of the stated intents of FinOps presented by the foundation is to optimize spending by companies through greater visibility and efficient use of cloud deployments. This is in response to the variable costs associated with the cloud as more companies migrate there.
Google Cloud also joined the foundation’s technical advisory council, contributing to the organization’s FinOps framework requirements for certification and best practices. Such certification may be a way to introduce standards for cloud products that align with FinOps principles.
“We knew people doing this job of managing cloud spend needed a way to come together as a community to talk and share best practices,” says J.R. Storment, executive director of the FinOps Foundation. Prior to establishing the foundation, he was a co-founder of Cloudability, which was acquired by Apptio.
Introducing FinOps best practices has meant connecting engineering teams with finance and other parts of businesses, he says, for more cohesive understanding of the costs and expected benefits of investing in cloud. For example, an enterprise might invest in certain expensive cloud resources in order to move faster and more efficiently, while also looking for ways to cut other costs, Storment says.
Since it got its start, the foundation has grown to more than 3,000 current members. As of last July, the FinOps Foundation has been under the umbrella of the Linux Foundation, Storment says, after the organizations discussed ways they might work together.
Now the FinOps Foundation wants to codify frameworks in this space, he says, and give its members ways to present industry standards for cloud investment to CIOs. Google Cloud joining the ranks brings expertise in building systems that scale, Storment says. As a vendor-neutral, nonprofit organization, FinOps Foundation is open to discussing other cloud services providers joining, he says.
The presence of Google Cloud in the foundation may be a step toward tackling more topics that can affect cloud strategy and investment. “It was a big step for us,” Storment says. “We have cloud management platforms in the space that joined. We hadn’t yet had a cloud join until now.”
Turning to the recent State of FinOps report, Storment says his foundation saw very clear challenges organizations face when sorting out their cloud investment strategy. “The big thing among respondents was, ‘We know where the waste is, but we can’t get the engineering teams to take action on this,’” he says. The problem affects companies universally regardless of size or maturity, Storment says. “We had 10 or 12 respondents who were spending over $1 billion a year across different clouds and they all struggle with this problem.”
This problem has put more attention on engineering teams, he says, especially as their responsibilities begin to include cost consciousness. That is because of the increasing ability among engineers to spend money deploying resources and spinning up new infrastructure, Storment says.
Another significant challenge cited in the report, he says, was organizations had to learn how to pull together engineering, finance, and product teams to deal with shared costs associated with migrating to and working in the cloud.
Getting engineering teams to take action has become such a point of concern, Storment says the foundation retooled its focus to double-down on its engineering track. “That’s where people are having a hard time.” The FinOps Foundation also wants to help team members within organizations educate their colleagues to understand and take ownership of their cloud spend, he says. “It’s about how we get timely recommendations and information out to teams. Engineers love efficiency, but they weren’t always getting the costs and timely information back so they could be efficient.”
He says there are three approaches companies can use to get engineers to take action:
- Give them visibility, set them up for success.
- Gamify and create interesting new challenges.
- Show them how they can change the organization and get executive alignment with priorities.
Storment says the challenges raised in the report shows the necessity for FinOps to continue to evolve and spread as more organizations cross a tipping point with cloud investments. “This practice has become a requirement for companies running cloud at scale,” he says. “People are crowdsourcing this model to create the answers. People are trying to understand what does great look like.”