FinOps practices rely on reporting and automation to increase ROI by continuously identifying opportunities for efficiency and taking action regarding cloud optimization in real-time. By automating their dynamic resourcing, organizations can also ensure their cloud environment’s underlying infrastructure always meets service-level objectives.

Inform: Organizations need accurate and up-to-date visibility to make intelligent decisions on allocation, benchmarking, budgeting and forecasting. Having correct, detailed allocation information of your cloud spending also enables correct chargeback and showback. FinOps teams need to know whether they are staying within budget, making accurate forecasts and achieving ROI targets.

Optimize: The second phase is about optimizing the cloud footprint. There are multiple ways to optimize. On-demand capacity is the most expensive. Cloud providers offer discounts for advanced reservation planning and increased commitments. Teams can also optimize the cloud environment by using automation to rightsize environments and turn off unused resources.

Operate: Organizations enter the third phase when they can continuously measure metrics—such as speed, quality and cost—against business objectives. The FinOps Foundation says, “Any organizational success is only possible if the organization builds a culture of FinOps, which involves a Cloud Cost Center of Excellence built around business, financial and operational stakeholders who also define the appropriate governance policies and models.