├── definition_of_finops.md ├── README.md ├── capabilities.md ├── lifecycle.md ├── principles.md └── LICENSE /definition_of_finops.md: -------------------------------------------------------------------------------- 1 | # FinOps Definition 2 | 3 | FinOps is an operational framework and cultural practice which maximizes the business value of cloud, enables timely data-driven decision making, and creates financial accountability through collaboration between engineering, finance, and business teams. 4 | -------------------------------------------------------------------------------- /README.md: -------------------------------------------------------------------------------- 1 | This repository is *** deprecated *** 2 | 3 | For the canonical definitions, lifecycle, capabilities, etc for FinOps, please visit finops.org/framework. Anyone can contribute, but only the Technical Advisory Council can vote to approve and accept changes. 4 | 5 | Terms of contribution are defined in the TAC's [Technical Charter](https://github.com/finopsfoundation/tac/blob/master/charter.md). 6 | -------------------------------------------------------------------------------- /capabilities.md: -------------------------------------------------------------------------------- 1 | # FinOps Capabilities 2 | 3 | These are what the FinOps team does in practice. This list is maintained under the TAC's Technical Charter and is an input for programs like the FinOps Certified Platform and FinOps Certified Service Provider. 4 | 5 | ## Understand Fully Loaded Costs 6 | * Map spending data to the business 7 | * Set tag strategy and compliance 8 | * Create showback and chargeback reporting 9 | * Define budgets and forecasts 10 | * Dynamically calculate custom rates and amortization metrics 11 | 12 | ## Enable Real-Time Decision Making 13 | * Provide timely and consistent spend / usage data to all stakeholders 14 | * Identify Anomalies 15 | * Find & Remove underutilized services 16 | 17 | ## Benchmark Performance 18 | * Trending & Variance Analysis 19 | * Create Scorecards, metrics & KPI’s 20 | * Benchmark internally and against “industry” peers 21 | 22 | ## Optimize Usage 23 | * Rightsizing 24 | * Workload Management 25 | * Automation 26 | 27 | ## Optimize Rates 28 | * Balance use of various rate types 29 | * Select discounts that match your flexibility 30 | * Pre-purchase capacity 31 | * Custom and Volume Discounts / Sustained Usage 32 | * Utilize Marketplace 33 | * Licensing Optimization 34 | 35 | ## Align Plans to the Business 36 | * Mini-Business Cases 37 | * Tracking and Trending 38 | * Communication strategy 39 | * Ongoing reviews with stakeholders on optimization opportunities 40 | * Develop a framework for decision making that aligns with the business drivers 41 | -------------------------------------------------------------------------------- /lifecycle.md: -------------------------------------------------------------------------------- 1 | ## The Three Phases of FinOps 2 | 3 | The FinOps journey consists of three iterative phases — Inform, Optimize and Operate. 4 | 5 | Any company may be in multiple phases at any time depending on which business unit, application or team is on the journey. 6 | 7 | ### Inform 8 | This is the first phase in the FinOps journey, empowering organizations and teams with visibility, allocation, benchmarking, budgeting and forecasting. The on-demand and elastic nature of cloud, along with customized pricing and discounts, makes it necessary for accurate and timely visibility for intelligent decisions. Accurate allocation of cloud spend based on tags, accounts or business mappings enable accurate chargeback and showback. Business and financial stakeholders also want to ensure they are driving ROI while staying within budget and accurately forecasting spend, avoiding surprises. Benchmarking as a cohort and against teams provides organizations with the necessary metrics to develop a high performing team. 9 | 10 | ### Optimize 11 | Once organizations and teams are empowered, they need to optimize their cloud footprint. Cloud providers offer multiple levers to optimize. On-demand capacity is the most expensive. To encourage advanced reservation planning and increased commitment, cloud providers offer discounts for commitments which typically involves complex calculations for making reservations (Reserved Instances (RI) / Committed Use Discounts (CUD – Google Cloud). In addition, teams and organizations can optimize the environment by rightsizing and automating turning off any wasteful use of resources. 12 | 13 | ### Operate 14 | Organizations start to continuously evaluate business objectives and the metrics they are tracking against those objectives, and how they are trending. Measure business alignment on speed, quality and cost. Any organizational success is only possible if the organization builds a culture of FinOps which involves a Cloud Cost Center of Excellence built around business, financial and operational stakeholders who also define the appropriate governance. 15 | -------------------------------------------------------------------------------- /principles.md: -------------------------------------------------------------------------------- 1 | ## Teams Need to Collaborate 2 | First and foremost, FinOps is about cultural change, breaking down the silos between teams that, historically, haven’t worked closely together. When this is done right, the finance team uses language and reporting that moves at the speed and granularity of IT, while engineering teams consider cost as a new efficiency metric. At the same time, the FinOps team works to continuously improve agreed-upon metrics for efficiency. They help define governance and parameters for cloud usage that provide some control, but ensure innovation and speed still flourish. 3 | 4 | ## Decisions Are Driven by the Business Value of Cloud 5 | Think first about the business value of cloud spend, not the cost. It’s easy to think of cloud as a cost center, especially when the spend reaches material levels. In actuality, cloud is a value creator, and the more you use it, the more cost it will incur. The role of FinOps is to help maximize the value created by the spend. Instead of focusing on the cost per month, focus on the cost per business metric, and always make decisions with the business value in sight. 6 | 7 | ## Everyone Takes Ownership for Their Cloud Usage 8 | Cloud costs are based on cloud use, which comes with a straightforward correlation: if you’re using the cloud, you’re incurring costs, and, thus, accountable for cloud spending. Embrace this fact by pushing cloud spend accountability to the edges of your organization, all the way to individual engineers and their teams. 9 | 10 | ## FinOps Reports Should Be Accessible and Timely 11 | In the world of per-second compute resources and automated deployments, monthly or quarterly reporting isn’t good enough. Real-time decision making is about getting data, such as spend changes or anomaly alerts, quickly to the people who deploy cloud resources. Real-time decisions enable these people to create a fast feedback loop where they can continuously improve their spending patterns, make intelligent decisions, and improve efficiency. 12 | 13 | ## A Centralized Team Drives FinOps 14 | Cultural change works best with a flag bearer. A central FinOps function drives best practices into the organization through education, standardization, and cheerleading. Maximize the results from rate optimization efforts by centralizing them, which gives your teams on the edge the freedom to maximize the results from usage optimization. The most successful companies decentralize using less, and centralize paying less. 15 | 16 | ## Take Advantage of the Variable Cost Model of the Cloud 17 | In the decentralized world of the cloud, planning for capacity moves from a forward-looking, “What are you going to need to cover demand?” perspective to a backward-looking, “How can you ensure you stay within your budget given what you’re already using?” perspective. Instead of basing capacity purchases on possible future demand, base your rightsizing, volume discounts, and RI/CUD purchases on your actual usage data. Since you can always purchase more capacity to fit demand, the emphasis becomes making the most out of the services and resources you’re currently using. 18 | -------------------------------------------------------------------------------- /LICENSE: -------------------------------------------------------------------------------- 1 | Apache License 2 | Version 2.0, January 2004 3 | http://www.apache.org/licenses/ 4 | 5 | TERMS AND CONDITIONS FOR USE, REPRODUCTION, AND DISTRIBUTION 6 | 7 | 1. Definitions. 8 | 9 | "License" shall mean the terms and conditions for use, reproduction, 10 | and distribution as defined by Sections 1 through 9 of this document. 11 | 12 | "Licensor" shall mean the copyright owner or entity authorized by 13 | the copyright owner that is granting the License. 14 | 15 | "Legal Entity" shall mean the union of the acting entity and all 16 | other entities that control, are controlled by, or are under common 17 | control with that entity. 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