Adopting FinOps in a Large-Scale Cloud Deployment

One of the biggest issues related to large-scale cloud deployments is overspending. It’s no surprise that as organizations scale their cloud-native Kubernetes environments, the associated costs rise along with that growth. However, there is a disconnect between the rising expenses and how well businesses can accurately and effectively monitor and control costs in the cloud, across multiple clouds and in hybrid cloud environments.

The ​​CNCF’s most recent FinOps for Kubernetes report shows that over the past year, 68% of the global cloud-native community reported their Kubernetes costs are increasing, while just 12% have lowered their Kubernetes expenses.

As a result, financial operations (FinOps) have become an essential practice to control rising cloud costs.

What is FinOps?

FinOps is the discipline that promotes a shared responsibility for an organization’s cloud computing infrastructure and costs. Rather than having disparate procurement teams working in silos to identify and approve costs, FinOps brings business, financial and information technology (IT) leadership together to establish best practices for usage and to manage the total cost of cloud-based Kubernetes deployments across the enterprise.

The goal of FinOps is to provide stakeholders with the visibility and cost understanding they need to make trade-offs between speed, cost and quality in their cloud and Kubernetes architecture and investment decisions. These decisions can range from cutting costs to making cost a secondary priority after speed or quality.

When implemented successfully, FinOps removes blockers, improves cross-functional collaboration and communication, enables faster application delivery and provides teams with financial visibility and control to drive better outcomes for the business.

Why is FinOps Important?

FinOps emerged to account for the on demand features of the cloud. With the rise and proliferation of cloud computing came a shift from the traditional capital expenditure (CapEx) model to an on demand operating expenditure (OpEx) model. While this enables businesses to pay for the time and resources they use rather than a set rate, tracking and optimizing disparate Kubernetes resources across the organization becomes increasingly difficult.

Moreover, individuals or teams throughout the organization might be provisioning and using services independently without any sort of central planning or oversight. Gaps in financial accountability and complex cloud pricing structures result in an increase in runaway expenses and a waste of Kubernetes resources.

Effectively addressing this issue requires a framework that helps organizations better manage cloud Kubernetes costs, which is why FinOps has become so important today.

FinOps Phases

The FinOps Foundation recommends a three-phase approach to managing the variable spend in the cloud. This approach is an interactive process; organizations should regularly return to the inform and optimize phases for continuous improvement.

Inform

In this phase, the organization will work together to gather all of the necessary information about cloud and Kubernetes usage and cost and make it visible and accessible to stakeholders. Such visibility is essential for benchmarking, budgeting and forecasting cloud and Kubernetes costs.

Optimize

This phase involves identifying key cost-optimization drivers and providing a standardized process for optimizing cloud and Kubernetes resource consumption. Some organizations may optimize cost savings for long-term instance use. Other organizations might optimize their cloud usage by auto-scaling or right-sizing Kubernetes resources. In addition, organizations can optimize Kubernetes workloads to reap the full benefits of cloud-native services.

Operate

The last phase involves the continuous planning and improvement of cloud and Kubernetes consumption. Stakeholders will work together to review cloud and Kubernetes spend metrics and make business trade-offs between speed, cost and quality.

Deploying FinOps to manage cloud cost

In today’s economy–and as we continue to see layoffs from big tech companies–it’s more important than ever for companies to stay on top of their cloud budgets and prevent overspending. When used correctly, FinOps can help you effectively monitor and control cloud and Kubernetes costs. Kubecost is an example of a cost management solution that can monitor, manage and optimize Kubernetes spend in real-time and at scale.

Successful adoption of such cost monitoring tools can enable faster application delivery while maintaining financial control, allowing businesses to use Kubernetes to accomplish their goals and accelerate innovation.

Tobi Knaup

A cloud-native pioneer and evangelist, Tobi Knaup serves as the CEO of D2iQ. Previously, Tobi served as D2iQ’s Chief Technology Officer. As the primary author of the world’s first open source container orchestrator (Marathon) and co-creator of the KUDO toolkit for building Kubernetes Operators, Tobi has the unique ability to understand an organization’s cloud-native journey from all levels--business, technological and talent. And as the driver behind D2iQ’s next-generation Kubernetes platform, Tobi helps make it possible for organizations to navigate the cost and time-intensive challenges associated with enterprise-grade container orchestration. Before co-founding D2iQ, Tobi was one of the first engineers and technology lead at Airbnb, proving the technology’s value at scale in a production environment serving millions of users. A German native, Tobi holds a Bachelor of Science and a Master of Science from the Technical University of Munich.

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