FinOps & Sustainability for AWS
As more and more companies migrate their workloads to the cloud, cloud cost management becomes increasingly important. AWS FinOps, a relatively new term coined by the FinOps Foundation, is an emerging practice for managing cloud costs. It’s a combination of financial management and cloud operations designed to help companies optimize their cloud spending while balancing business objectives, sustainability considerations, and organizational change management.
Cloudability, an AWS Partner, is a cloud cost management tool that helps companies manage their cloud costs while also supporting sustainability initiatives and the organizational change process. In this blog, we will explore how Cloudability can be used to implement FinOps, sustainability practices, and the organizational change process in AWS. We will use real examples and calculations to illustrate the concepts.
AWS Cost Explorer
Before we dive into Cloudability, it’s worth mentioning AWS Cost Explorer. Cost Explorer is a free tool provided by AWS to help you analyze your AWS spending. It provides a high-level view of your costs and usage, and allows you to drill down into specific services and resources. You can use Cost Explorer to create custom reports, set up cost alerts, and even forecast your future spending.
While Cost Explorer is a great tool, it does have some limitations. For example, it doesn’t provide detailed information on unused resources or cost optimization recommendations. This is where Cloudability comes in.
Cloudability
Cloudability is a cloud cost management tool that provides detailed insights into your cloud spending while supporting sustainability initiatives and the organizational change process. It offers a range of features, including cost allocation, budgeting, and optimization recommendations that can help reduce cloud costs, improve the sustainability of your operations, and facilitate the organizational change process.
Cost Allocation
Cost allocation is the process of assigning costs to different business units or projects. This allows you to understand who is responsible for each cost, and helps you optimize your spending while accounting for sustainability considerations and the organizational change process.
Cloudability makes cost allocation easy. It automatically categorizes your AWS spending based on tags, which you can customize to match your business needs. You can also set up custom rules to categorize spending based on other criteria, such as resource names or instance types.
Once you have categorized your spending, you can use Cloudability to create reports that show spending by business unit or project. This allows you to identify areas where costs can be reduced while also supporting sustainability initiatives and the organizational change process, such as identifying which departments or teams need training in FinOps practices.
Optimization Recommendations
Optimization is a key aspect of FinOps, sustainability, and the organizational change process. It’s all about identifying areas where you can reduce costs without impacting performance while also addressing the challenges of organizational change.
Cloudability provides a range of optimization recommendations based on best practices and industry standards. For example, Cloudability can identify idle or underutilized resources and recommend that they be terminated or resized. It can also recommend the use of reserved instances, which can save you money on long-running workloads while also reducing the number of instances needed, thus reducing carbon emissions.
Let’s look at a real example. Suppose you have an EC2 instance that is running 24x7 and is currently on-demand. Cloudability might recommend that you purchase a reserved instance instead, which could save you up to 30% on the hourly cost while also reducing your carbon footprint. This could also be an opportunity to identify which teams or departments are not yet following best practices in FinOps and provide training or guidance to facilitate the organizational change process.
Budgeting
Budgeting is an important aspect of FinOps, sustainability, and the organizational change process. It allows you to set spending limits for each business unit or project, and provides visibility into how much has been spent and how much is remaining while also ensuring that sustainability considerations and the organizational change process are accounted for.
Cloudability makes budgeting easy. You can set up budgets for each category and receive alerts when spending exceeds a certain threshold. You can also view budget reports, which show how much has been spent and how much is remaining while also providing visibility into the sustainability impact of your spending.
Let’s look at a real example. Suppose you have a budget of $10,000 per month for your development team. Cloudability can provide alerts when spending reaches 80% of the budget, allowing you to take action before the budget is exceeded. Additionally, you can use Cloudability to set sustainability goals and budgets, such as reducing carbon emissions or minimizing resource waste, and track your progress toward those goals while also addressing the challenges of the organizational change process.
Organizational Change Process
Implementing FinOps practices and sustainability initiatives can be a significant organizational change for some companies. It may require changes in processes, roles, and responsibilities, and can create resistance to change from some team members. Therefore, it’s essential to have a plan for the organizational change process.
Cloudability can help facilitate the organizational change process by providing data and insights that help identify areas for improvement and by providing training and support for FinOps practices. For example, Cloudability can help identify teams or departments that are not following best practices in FinOps and provide guidance and training to support the organizational change process.
Challenges for Implementing FinOps
Implementing FinOps can be challenging, particularly in large organizations with multiple teams and departments. Some of the common challenges include:
- Lack of visibility: Cloud resources can be distributed across multiple teams and departments, making it difficult to get a complete view of cloud costs and usage.
- Resistance to change: Some team members may be resistant to change, particularly if it requires changes to established processes or roles.
- Lack of expertise: FinOps requires expertise in both financial management and cloud operations, which may be challenging for some organizations to develop internally.
- Lack of standardization: Different teams or departments may have different ways of categorizing or allocating costs, making it difficult to get a consistent view of cloud spending.
Cloudability can help overcome some of these challenges by providing a single platform for managing cloud costs, supporting the organizational change process, and providing best practices and expertise in FinOps.
Conclusion
AWS FinOps is a critical practice for managing cloud costs, and Cloudability is an excellent tool for implementing FinOps, sustainability practices, and the organizational change process in AWS. By providing detailed insights into your cloud spending, Cloudability can help you optimize your costs, allocate costs to the right business units, set budgets that align with your business objectives and sustainability goals, and reduce your environmental impact. It can also facilitate the organizational change process by providing training and support for FinOps practices and identifying areas for improvement.
As you implement FinOps, sustainability practices, and the organizational change process in your organization, it’s important to remember that it’s not a one-time task. FinOps, sustainability, and the organizational change process are ongoing practices that require continuous monitoring and optimization. By using tools like Cloudability, you can ensure that your cloud costs, environmental impact, and organizational processes remain under control while also driving business objectives and addressing the challenges of the organizational change process.
About the Authors:
My name is Sven Leiss and I am an 5x certified AWS Ambassador, AWS Community Builder and AWS Migration Blackbelt. I have been working in the AWS space for the past years and have extensive knowledge of the AWS platform and its various services. I am passionate about helping customers get the most out of the cloud and have a great track record of successful implementations.
We have extensive experience in designing and implementing cloud architectures using AWS services such as EC2, S3, Lambda and more. We are also well versed in DevOps and AWS cloud migration journeys.
If you are looking for an experienced AWS expert, I would be more than happy to help. Feel free to contact me to discuss your cloud needs and see how I can help you get the most out of the cloud.
