As the financial services industry continues to adopt cloud computing, managing cloud costs for competitive advantage has become both a significant concern and opportunity for CEOs, CFOs and CIOs. FinOps (“Financial Operations”) is an approach that helps organisations optimise their cloud spending by bringing together finance, business, and technology teams. In this blog post, we will introduce the concept of FinOps and discuss how Ikigai can help you implement it in a sustainable fashion.

If it seems that FinOps is about saving money, then think again. FinOps is about making money.

FinOps Foundation

What is FinOps?

FinOps (“Financial Operations”) is a framework that helps organisations manage their cloud costs effectively by promoting a culture of cost-consciousness and accountability. The goal of FinOps is to optimise cloud spending by providing a holistic methodology that allows teams to collaborate, share information, and make data-driven decisions by considering both the benefits and costs of cloud investments.

The key principles of FinOps are:

1. Decentralise cost ownership: One of the main principles of FinOps is to decentralise cost ownership. This means that each team takes responsibility for its cloud spending, and the costs are allocated to the appropriate business units. By decentralising cost ownership, organisations can create a culture of accountability, and teams become more aware of their cloud spending while avoiding costly approval processes and unintended consequences, such as "shadow IT".
2. Use data to make informed decisions: Another key principle of FinOps is to use data to make informed decisions. By collecting and analysing data on cloud spending, teams can identify areas where they can optimise costs, and make data-driven decisions to reduce waste and maximise value.
3. Collaborate across teams: FinOps encourages collaboration across finance, operations, and technology teams. By working together, teams can share information, align on goals, and make decisions that benefit the entire organisation.

Why is FinOps important?

FinOps is important because it helps organisations manage their cloud costs effectively. As more companies move to the cloud, cloud spending is becoming a significant cost centre. Without proper management, cloud costs can spiral out of control, leading to budget overruns and decreased profitability.

The above diagram demonstrates how, for organizations operating on the FinOps model, a cross-functional team known as a Cloud Cost Center of Excellence (CCoE) interacts with the rest of the business to manage the cloud strategy, governance, and best practices that the rest of the organization can leverage to transform the business using the cloud.

FinOps helps organisations address this issue by providing a framework that allows them to optimise cloud spending. By decentralising cost ownership, using data to make informed decisions, and collaborating across teams, organisations can create a culture of cost-consciousness and accountability. This can lead to significant cost savings and increased profitability.

How can Ikigai help?

At Ikigai, we specialise in building cloud-native software solutions for the financial services industry. As part of our services, we offer support around FinOps. Our team of experts can help you implement FinOps in your organisation, providing you with the tools and guidance you need to optimise your cloud spending.

We can help you

1. Assess your current cloud spending: We can help you assess your current cloud spending, identify areas where you can optimise costs, and develop a plan to reduce waste and maximise value.
2. Implement FinOps best practices: We can help you implement FinOps best practices, including decentralising cost ownership, using data to make informed decisions, and collaborating across teams.
3. Provide ongoing support: We can provide ongoing support to help you monitor your cloud spending, identify opportunities for optimisation, and make data-driven decisions to maximise value.

Conclusion

FinOps is a new approach that helps organisations manage their cloud costs effectively. By bringing together finance, operations, and technology teams, FinOps provides a framework for optimising cloud spending and creating a culture of cost-consciousness and accountability. At Ikigai, we can help you implement FinOps in your organisation, providing you with the tools and guidance you need to maximise value and increase profitability. Contact us today to learn more about our FinOps services.