Tag Archives: FinOps

Cloud Cost Management Vs. Optimisation

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I just noticed that it has been a year since the last posting, it seems it takes me a long time to linger on ideas before I publish them.

I have been working as a FinOps in the last year and saw many consulting companies that offer “Cost Optimisation” services and I find it frustrating. The true name of what they offer is “Cost Management” which is the 1st step in understating cloud spend, reducing waste.

Cost optimisation on the other hand is not about reducing cost, it is ensuring that the spending we do is maximised to gain as much performance for the lowest spend, but we will spend money.

The main difference is in the time and planning of the action, the “Management” is going over Cloud resources and cleaning the unused volumes, terminating virtual machines and dealing with RI’s which can be done in a 2 hour review of the Cloud account.
“Optimisation” on the other hand is a process that involves the product team, the architects, the developers and the Cloud team to ensure that the new feature will use the cloud resource most effectively while spending the least amount of money, this is an iterative process that can take anywhere from several days to even months, and in some cases I saw to the realisation that the proposed feature is not financially viable and dropping it completely.

I know that selling a “cost management” is harder than telling a client that we can “optimise” his costs, but we should also need to provide honesty to our clients.

Thankfully I am in a position in my current position to try and preach that change and I am trying to instil that understanding in the company, and from there to our clients.

Enter the world of FinOps

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After the loss of my previous position due to the COVID-19, I was fortunate to land a position as a FinOps. The title and the concept was new to me, not the practice, that I have been doing both as a consultant and also as part of my previous job.

To learn that like “DevOps” some one took the “Finance” and “Operations” and combined them together to “FinOps”. To try to explain this to someone outside the Hi-Tech industry is confusing “I am a technological person responsible on overseeing the technological expenditures of the company and working on reducing them while ensureing not to hinder productivity or inovetion” , it’s that last part that most people have a hard time with, as most associate R&D with unchecked spending and calling it “research” (somewhat like throwing a rock into a lake and hoping to hit a fish).

But the FinOps, in parallel to the CISO role is a person that will have his reach in SO many aspects of a company, be it reigning in the AWS spending, working with the developers to ensure that they get the tools they NEED but not nesserily the tools the want, negotiate and review contracts for new services and tools, evaluate the new tools both from functionality and cost effectiveness the FinOps person has his plate full of things to do.

All this and the roles I held before helped me realise that a many place make a crucial mistake when they employee or hire a person for the FinOps position, many places hire an analyst to the position, someone that comes from an financial background not a technological. Placing the emphasis on the Fin aspect of the title, like those that only want developers to DevOps positions.

That method, in my opnion, is the incorrect one.
What you get is someone with a limited scope that have no “operational” skill set and will have a slow learning about the technology and understanding how to talk to the technical people he needs to convince with his recommendation “You can run the database on a ECS with a presistent volume on EFS and t2.medium backend, instead of a m5.large” (if you don’t understand what I said here, drop me a line).

A good FinOps person needs a good Operational background and a solid understanding on how to consider financial implications, but the skill most tech savvy people have is the hard one to find – People skills.
FinOps need to negotiate contracts, talk to sales people and tech people, and ( I know from personal experiance) a lot of us do not have that.

In summery, I am glad that I took this change in direction and hope I will be successful in it, and that I can give from my learning to others.

This post was originally meant to be posted on #peerlyst, but due to the demise of that community, I posted it here.