Cloud FinOps

Chapter 19. Managing to Unit Economics: FinOps Nirvana

Now that you’ve walked through the three phases of the FinOps lifecycle, you’ve arrived at the most exciting—and challenging—shift in thinking about cloud spend. The nirvana stage of FinOps is getting to unit economic spend management (what is our cost per X, where X = customer, rendering, user, etc.). It is important to get to that level of visibility so you can make informed decisions about when to spend more, or less, in cloud. And to do that you’ll need to flex all of your FinOps muscles as well as bring in help from some other disciplines.

Everything you’ve done to date has enabled you to get here. You’ve allocated spend, set optimization goals, and implemented procedures to enable your teams to reach those goals. You’ve likely gone through the FinOps lifecycle a few times, refining your allocation strategies, metric thresholds, and visibility into cloud usage each time.

But there’s still a gap. Each time your bill goes up, the debate reopens about whether the spend is good or bad. Has the bill increased due to growth in your business? Is it because of the acceleration of cloud migrations? Or has it gone up due to inefficient patterns of usage creeping back into your teams’ habits? It’s very tricky to give a definitive answer, especially one in which executives will have confidence.

In this chapter, you’ll start tying your spend to business value through unit economics. Metrics help you identify the value in allowing ...