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Cloud Governance: Focus on FinOps
Achieving the full benefits of Cloud Computing
A shift to cloud computing often comes with promises of optimized cost efficiency, security, and development time, but without a strong focus on operational and financial management, realizing these benefits may be trickier than expected. Using our SONAR Trend Platform, we created an overview and mapping of relevant trends related to Cloud Governance based on their occurrence within expert media articles, mass media, patents and scientific publications.
The pillars of Cloud Governance
Cloud governance is the foundation for making sure services run smoothly in the cloud, and involves defining, monitoring, and auditing a set of rules, guidelines, and processes by which companies guide their cloud operations. We then grouped topics and trends related to cloud governance into four distinct categories.
Cloud Financial Management
Processes and tools to identify, measure, monitor, manage and optimize cloud-related costs and spending.
Cloud Operations Management
Concerned with requirements, configuration, delivery, optimization, and performance of cloud workloads, resources, and services.
Cloud Data Management
Manage cloud data across platforms and lifecycle, from sourcing, classifying, encryption, access, storage, and deletion.
Cloud Security & Compliance Management
Ensure cloud-related risk assessment, privacy control, identity and access management, data encryption, application security, and compliance.
Adopting the FinOps Lifecycle model
The FinOps model has become a paradigm for taking back control of cloud cost management, structuring cloud governance, and fostering cloud operations.
FinOps Lifecycle
INFORM
The Inform phase focuses on strengthening organizations that want to adopt cloud computing, by developing visibility, determining cost allocation, and establishing how to budget and forecast costs; this is based on a foundation of distributed ownership over cloud usage as well as accessible, timely reports.
OPTIMIZE
The Optimize phase involves taking the knowledge and data gained from the Inform phase and creating actionable steps to optimize cloud spending: this requires considering which KPIs to use, determining the appropriate scale for the infrastructure, and choosing a suitable pricing model.
OPERATE
By the Operate phase, companies should be exploring how to more deeply embed FinOps principles into their company culture and organizational practices: if striving for true organization-wide change, this step requires effective change management and training for workload owners.
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MARKET GROWTH OF IT AND CLOUD OPERATIONS
This research focused specifically on the sectors of IT operations management, Cloud operations management, and FinOps, working with PAC (Teknowlogy Group) to track the prospective changes in these markets.
Main lessons learned on FinOps
Implementing FinOps and Cloud Governance requires careful consideration and preparation which addresses all cultural, functional, and operational changes to be made.
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Financial Accountability
Financial accountability needs to be at the forefront of decision-making. To do this, a FinOps role or team should be accountable to a central finance team but also be functionally located within a cloud management/DevSecOps setting.
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Cost Calculation
All costs, including non-cloud, public cloud, private cloud, maintenance, people costs, and more, should be evaluated along with their impact on deploying business services.
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Demand Profiles
Each technology should be assessed beforehand to determine which business functions it supports and its anticipated demand, therefore facilitating in creating accurate cost forecasts.
Ongoing practice
The FinOps team needs to be considered an equal partner in the DevSecOps process, as they help build the framework for long-term financial analysis and support.
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Managing Cloud
Decide whether to use an internal or external cloud management platform in order to manage data, integration, automation, security, and financial functions.
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