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In today’s digital age, managing cloud costs has become a critical aspect of business operations. FinOps, or Financial Operations, is a practice that combines finance, technology, and business to optimize cloud spending and drive business value. In this blog post, we will explore the fundamentals of FinOps, its importance, and how it can help organizations manage their cloud infrastructure efficiently.
What is FinOps?
FinOps is a practice that focuses on managing cloud costs and driving business value. It involves tracking cloud spending, optimizing costs in an ongoing and sustainable manner, and ensuring accountability within the organization. FinOps brings together finance, technology, and business teams to collaborate on cloud financial management. This collaboration ensures that cloud resources are used efficiently and that costs are optimized.
The Importance of FinOps
FinOps helps organizations gain visibility into their cloud spending, optimize costs, and ensure that cloud resources are used efficiently. It also promotes a cultural shift towards cost-consciousness and accountability. By implementing FinOps, organizations can achieve significant cost savings, improve efficiency, and drive business value.
Key Components of FinOps
- Visibility: Understanding cloud costs and usage. This involves tracking cloud spending, analyzing usage patterns, and identifying cost-saving opportunities. Tools like Azure Cost Management and Azure Advisor can help organizations gain visibility into their cloud costs.
- Optimization: Identifying and implementing cost-saving opportunities. This includes optimizing virtual machines, cleaning up orphan objects, and leveraging cost-saving programs like reservations and savings plans.
- Governance: Establishing policies and practices to manage cloud spending. This includes setting up guardrails and alerts, implementing budgeting mechanisms, and ensuring compliance with organizational policies.
The FinOps Lifecycle

- Inform: This phase involves gaining visibility into cloud costs and usage. Organizations need to track their cloud spending, analyze usage patterns, and identify cost-saving opportunities. Tools like Azure Cost Management and Azure Advisor can help organizations gain visibility into their cloud costs.
- Optimize: In this phase, organizations implement cost-saving opportunities identified in the Inform phase. This includes optimizing virtual machines, cleaning up orphan objects, and leveraging cost-saving programs like reservations and savings plans.
- Operate: The Operate phase involves continuously monitoring and managing cloud costs. Organizations need to ensure that their cloud resources are used efficiently and that costs are optimized. This phase also involves regular assessments to track progress and maturity.
Implementing FinOps can help organizations achieve significant cost savings, improve efficiency, and drive business value. By gaining visibility into cloud costs, optimizing resources, and establishing governance practices, organizations can manage their cloud infrastructure more effectively. This is the first post in a series about FinOps. Stay tuned for our next blog post, where we will dive deeper into the FinOps Foundation and its maturity model.
For years now, Invero has made its mission to help clients maximize the value of their investments in cloud because we are firm believers in the benefits that the cloud can bring to organizations of all sizes. FinOps is core to achieving this mission because without proper governance around cloud spend and tying that back to the business value that each dollar spent is driving, then there is a high risk of wasting money or not achieving optimal return on investment.
Many organizations that we work with struggle to know where to start, which is why we developed FinOps Ready™. This is our solution to help you develop a roadmap for maturing your FinOps practice based on your unique needs, it’s not a one-size fits all or cookie cutter plan. Learn more and get started for FREE on your own today, or contact us to get help from our experts.