Despite many uncertainties in cloud computing, one truth is evident: costs will always tend to go up unless you’re actively engaged in the process. Whether you’re new to managing cloud spend or a seasoned pro, this book will clarify the often misunderstood workings of cloud billing fundamentals and provide expert strategies on creating a culture of cloud cost management in your organization.
Drawing on real-world examples of successes and failures of large-scale cloud spenders, this book outlines a road map for building a culture of FinOps in your organization. Beginning with the fundamental concepts required to understand cloud billing concepts, you’ll learn how to enable an efficient and effective FinOps machine.
- Learn how the cloud works when it comes to financial management
- Set up a FinOps team and build a framework for making spend efficiency a priority
- Examine the anatomy of a cloud bill and learn how to manage it
- Get operational recipes for maximizing cloud efficiency
- Understand how to motivate engineering teams to take cost-saving actions
- Explore the FinOps lifecycle: Inform, Optimize, and Operate
- Learn the DNA of a highly functional cloud FinOps culture
Table of Contents
- I. Introducing FinOps
- 1. What Is FinOps?
- 2. Why FinOps?
3. Cultural Shift and the FinOps Team
- Who Does FinOps?
- A New Way of Working Together
- Where Does Your FinOps Team Sit?
- Understanding Motivations
- FinOps Throughout Your Organization
- Hiring for FinOps
- FinOps Culture in Action
4. The Language of FinOps and Cloud
- Defining a Common Lexicon
- Defining the Basic Terms
- Abstraction Assists Understanding
- Cloud Language Versus Business Language
- Creating a Babel Fish Between Your DevOps and Finance Teams
- The Need to Educate Both Sides of the House
- Benchmarking and Gamification
5. Anatomy of the Cloud Bill
- Cloud Billing Complexity
- The Basic Format of the Billing Data
- Time, Why Do You Punish Me?
- The Importance of Hourly Data
- A Month Is Not a Month
- A Dollar Is Not a Dollar
- A Simple Formula for Spending
- II. Inform Phase
6. The FinOps Lifecycle
- The Six Principles of FinOps
- The FinOps Lifecycle
- Where Do You Start?
- Why to Start at the Beginning
- 7. Where Are You?
8. Allocation: No Dollar Left Behind
- Why Allocation Matters
- Chargeback Versus Showback
- The Showback Model in Action
- Chargeback and Showback Considerations
- Spreading Out Shared Costs
- Amortization: It’s Accrual World
- Creating Goodwill and Auditability with Accounting
- Going Beyond Cloud with the TBM Taxonomy
- The “Spend Panic” Tipping Point
9. Tags, Labels, and Accounts, Oh My!
- Cost Allocation Using Tag- and Hierarchy-Based Approaches
- Tags and Labels: The Most Flexible Allocation Option
- Getting Teams to Implement Tags
- III. Optimize Phase
10. Adjusting to Hit Goals
- Why Do You Set Goals?
- The First Goal Is Good Cost Allocation
- Is Savings the Goal?
- Hitting Goals with OKRs
- Goals as Target Lines
- Detecting Anomalies
- Reducing Spend to Meet Forecast
11. Using Less: Usage Optimization
- The Cold Reality of Cloud Consumption
- Where Does Waste Come From?
- Usage Reduction by Removing/Moving
- Usage Reduction by Resizing (Rightsizing)
- Usage Reduction by Redesigning
- Effects on Reserved Instances
- Benefit Versus Effort
- Serverless Computing
- Not All Waste Is Waste
- Crawl, Walk, Run
- Advanced Workflow: Automated Opt-Out Rightsizing
- Tracking Savings
- 12. Paying Less: Rate Optimization
13. Paying Less with Reserved Instances and Committed Use Discounts
- Introduction to Reservations
- Reserved/Committed Usage
- Overview of Usage Commitments Offered by the Big Three
- Amazon Web Services
- Google Cloud Platform
- Microsoft Azure
14. RI and CUD Strategies
- Common Mistakes
- Steps to Building an RI Strategy
- The Centralized Reservation Model
- Timing Your Reservations
- When to Rightsize Versus Reserve
- Building Your Strategy
- IV. Operate Phase
- 15. Aligning Teams to Business Goals
- 16. Metric-Driven Cost Optimization
17. Automating Cost Management
- What’s the Goal of Automation?
- Automation Tools
- Automation Working Together
- Safety and Security
- How to Start
- What to Automate
18. FinOps for the Container World
- Containers 101
- The Move to Container Orchestration
- The Container FinOps Lifecycle
- Container Inform Phase
- Container Optimize Phase
- Container Operate Phase
- Serverless Containers
- 19. Managing to Unit Economics: FinOps Nirvana
- Afterword on What to Prioritize (from J.R.)
- Title: Cloud FinOps
- Release date: December 2019
- Publisher(s): O'Reilly Media, Inc.
- ISBN: 9781492054627