What Are FinOps Tools?
FinOps, or cloud financial management, is a framework for managing cloud costs and optimizing cloud spending. It relies on a combination of best practices, tools, and cultural shifts that enable organizations to understand their cloud costs, make informed collaborative decisions about their cloud usage, and optimize their spending to achieve better business outcomes.
FinOps tools are software applications that help organizations manage their cloud costs and optimize their cloud spending. These tools are designed to provide visibility into cloud usage, identify areas of inefficiency, and help teams make informed decisions about their cloud spending. Common FinOps tools include cost management dashboards, cloud cost optimization tools, and budgeting and forecasting tools.
In this article:
- Cloud FinOps Tools Features and Capabilities
- FinOps Tools: Native vs. Third Party
- Choosing FinOps Software That’s Right For Your Business
Cloud FinOps Tools Features and Capabilities
The main features and capabilities of FinOps tools can vary depending on the specific tool and vendor, but some common features include:
- Cost management dashboard: Provides a centralized view of cloud spending, enabling teams to track usage and identify areas of cost savings. Dashboards can also provide visualizations and reports to help teams analyze and understand their cloud costs.
- Cost allocation and chargeback: Enables organizations to allocate cloud costs to specific teams, departments, or projects, helping to ensure that costs are distributed fairly and accurately. This functionality may also provide automated invoicing and billing features.
- Cloud cost optimization: Helps organizations identify unused or underutilized resources, and provides recommendations for reducing cloud costs. This functionality can also provide automation features to optimize resource usage and reduce waste.
- Budgeting and forecasting: Helps organizations set budgets for their cloud spending, and provides real-time forecasts of cloud costs based on current usage. This feature may also provide alerts and notifications when spending exceeds budgeted amounts.
- Cloud governance: Enables organizations to enforce policies and best practices for cloud usage, and provides visibility into compliance issues. This capability may also provide automation features to enforce utilization and spend policies and ensure compliance to avoid costly regulatory fines.
- Integration with cloud providers: Most FinOps tools can integrate with popular cloud providers such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, ensuring organizations can monitor and manage cloud costs across multiple providers from a single platform.
- Collaboration and communication: Some FinOps tools provide collaboration features, such as team chat and comments, to facilitate communication between teams and stakeholders.
FinOps Tools: Native vs. Third Party
Native cloud provider tools are developed and provided by the cloud providers themselves, such as AWS, Azure, or Google Cloud. Another option is to use FinOps tools by third-party vendors. Let’s review some of the pros and cons of each option.
Pros and Cons of Native FinOps Tools from Cloud Providers
Some of the pros and cons of using native tools include:
- Tight integration with cloud provider services and features
- Seamless setup and configuration process
- Often offered for free or included in the cloud provider’s platform pricing
- Limited functionality and feature set
- Vendor lock-in to a specific cloud provider
- May not provide enough insights for advanced cost optimization
- Limited customization and flexibility
Pros and Cons of Third-Party FinOps Tools
Third-party FinOps tools are developed by independent vendors and provide additional functionality and capabilities beyond those offered by native tools. Some of the pros and cons of using third-party tools include:
- Enhanced functionality and features, often with more data visualization and analytics options
- Multi-cloud support, which provides comprehensive cost management across multiple cloud providers
- Customizable and flexible to meet specific organizational needs
- Vendor-agnostic and not tied to a specific cloud provider
- Additional costs on top of the cloud provider’s fees
- Integration and compatibility issues may occur
- Additional time and resources are needed for setup and maintenance
- May not have access to all cloud provider features
In summary, while native cloud provider tools offer seamless integration and compatibility, third-party FinOps tools provide more advanced features and multi-cloud support. Ultimately, the decision on whether to use native or third-party tools will depend on the organization’s specific needs and priorities.
Choosing FinOps Software That’s Right For Your Business
Choosing the right FinOps software for your business can be a challenging task, but considering the following factors can help you make an informed decision:
- Your organization’s cloud infrastructure: The FinOps software you choose should be compatible with the cloud infrastructure you are using. For instance, if your organization uses AWS and Azure, you should choose a tool that is compatible with those two cloud platforms.
- Your organization’s cloud usage: Different organizations have different cloud usage patterns, and the software you choose should be able to support your usage. Consider factors like the number of users, applications, and services that use the cloud, and choose a software that can handle your scale.
- Your budget: FinOps tools can vary in price, and you should choose a tool that fits your budget. Consider the total cost of ownership, including licensing fees, implementation costs, and ongoing maintenance costs.
- Features and capabilities: Consider the features and capabilities of the software, including cost management dashboards, cloud cost optimization, budgeting and forecasting, cloud governance, and cost allocation and chargeback. Choose a tool that meets your specific needs.
- Integration with other tools: Consider whether the software can integrate with other tools you are using, such as IT service management, business intelligence, or project management tools.
- Support and documentation: Look for software vendors that provide adequate support and documentation to help you get the most out of the tool.
- User experience: Finally, consider the user experience. Prioritize finding a tool that is easy to use and provides adequate training and support.
Grow Your FinOps Toolkit with Spot by NetApp
Public cloud providers offer native tools that can help your organization grow its FinOps practice. However, they may only cover basic cost management capabilities and are siloed to their own cloud. With more organizations spreading their data across multiple clouds, this approach limits visibility into multi-cloud expenses.
Spot by NetApp’s portfolio of FinOps tools can help provide visibility, actionable insights, and automated cloud cost optimization for AWS users. Spot Eco can automatically manage, optimize, and purchase reserved instances and Saving Plans, helping to maximize savings and ROI on your cloud spend.
Ready to start building your FinOps practice? Get a free Spot Eco demo to begin saving and optimizing your cloud commitments.