Cloud providers are charging you daily for ZERO value.
With enterprise AI/ML spending set to skyrocket, the stakes have never been higher; small wastages may spiral into huge failures.
But FinOps is the antedote; here is the single core concept that has helped enterprises shed millions from their bills.
99% of enterprises understand that fast decision-making is required to stay adaptive. Some calls are now made “at the edge”; inside teams, with guardrails, without hands-on oversight. It’s a perfect match for the speed & agility of the cloud. But then the first bill arrived and the CFO, CTO & CIO fell off their chairs: “Wasn’t this supposed to be CHEAPER?“. “Are we getting the right value for this?” And then they dusted off the old cost-cutting playbooks & got to work.
Hyiene and removing obvious wastage is important. But without a truly product-centric view, nobody can judge with certainty if spending is justified. Is $100 of spend better than $10,000? The answer is that it depends. And until the surrounding factors are understood cost management approaches are made in the dark.
The best way to make a call is by factoring it into the whole product or service story. This includes the organisation strategy & specific business models. This unlocks an insightful & shared assessment method that make more strategic sense. Maybe a high bill with high profitability is justified. And maybe a light bills with low value needs examination.
While cloud hygiene and optimisation is beneficial in every situation, it shouldn’t be executed blindly. Great organisations level up from this & incorpoate cloud costs into an overall rollup of dynamic “business model health” metrics. Well-established metrics such as Unit Economics & Cost of Revenue need to be front-and-centre and shared as the #1 unit of health.
High performers are great at building a culture of seeing technology as a ENABLER to ambitious business models & value propositions. They clearly connect the dots between adoption & the true meaning to the organisation. Then they dynamically make bets, track progress and respond. In my experience, a blind approach to FinOps as a cost cutting weapon is misguided. It’s even more imperative now that (in our digital world) value and costs can shift & flucuate at light speed, by the hour.
Keeping Unit Economics front and centre for every organisation is critical. It needs to include cloud & any other investments. It speaks to one of most tangible advantages of the “data-driven enterprise”. It is with this capability that organisations can really achieve competitive advantage by not only empowering teams to make rapid decisions, but by establishing the ultimate set of guardrails: a set of clearly articulated Unit Economics.