Architecting Change: TAC Reflections on the Evolution of the FinOps Framework
About the Author: Lucas Paratore - Group Product Manager, CloudHealth | Technical Advisory Counsel, FinOps Foundation
With this year’s update, the FinOps Framework captures the shift that has been building across the industry as teams move from managing cloud spend to owning technology outcomes. First introduced last year, scopes have evolved beyond technology stacks like public cloud and SaaS into a business construct like Cost Center that can span across multiple technologies. As scopes expand, FinOps teams aren’t just managing more spend, they’re taking ownership of how the technology drives business outcomes. This transition naturally will uplevel conversations and enable FinOps teams to work with executives to build buy in.
Scopes and Technology Value
It became clear leading up to last year's framework changes that FinOps teams were being asked to take on more than just public cloud. To align with that trend, the concept of “Scopes” was introduced to account for spending outside of the public cloud. With this year's framework changes, scopes have evolved to not just viewing spend across technologies but the business lens and ownership of that usage. As costs aggregate and FinOps principles are applied like Unit Economics, a company gains a clearer picture into the state of their business. With this broader and business-focused view, it is becoming easier for FinOps teams to build executive support
Executive Alignment Makes it Happen
Just like any other year, it’s hard to get organizations to prioritize and take action on FinOps activities. With the expanded scopes and focus on broader technology and not just public cloud, it becomes easier to communicate outcomes with leadership with broader ownership. One of the most critical parts of a successful FinOps practice is having executive support and by having conversations on technology outcomes instead of cloud spend, it becomes much easier to do that.
MSP is Underrepresented
One gap in the current framework is the lack of focus on MSPs and partner-led FinOps models. We have seen this market grow heavily over the last five years with some cloud providers continuously investing in enabling it. While the framework can help partners understand their customers needs, it does not address how to operationalize FinOps across customers or how to build and package FinOps as a service. Use cases like scaling FinOps services, generating invoices, and optimizing across customers are critical to MSPs, but not represented. As more organizations turn to MSPs to support their FinOps journey, I would expect the framework and supporting content next year to better account for this trend.
Just because a FinOps team is doing it, does that make it FinOps?
With the framework changes and State of FinOps results, people responsible for FinOps are seeing their ownership extend beyond the public cloud and towards technology outcomes. The State of FinOps reported that 90% of FinOps teams will be responsible for SaaS this year (if they are not already) and 28% of FinOps teams are taking into account labor. This raises a bigger question: if FinOps teams continue to take on SaaS, labor, and broader technology ownership, where does FinOps stop? If those same teams become responsible for security decisions in the future, does the FinOps framework need to include security?