FinOps Terms to Know

FinOps, or Financial Operations, is the practice of integrating financial accountability into cloud spending, enabling teams to manage cloud costs effectively by combining finance and cloud technology. Key FinOps processes include cost monitoring, allocation, attribution, tagging, amortization, showback, and chargeback, all designed to enhance financial management in the cloud. Effective cloud financial management involves optimizing and governing cloud costs through cost optimization, rightsizing, forecasting, and understanding unit costs, utilization, and cost anomalies. Various cloud pricing models, such as On-Demand, Committed Use Discounts, Reserved Instances, Savings Plans, Spot Instances, and Enterprise Agreements, play a crucial role in cost optimization. The choice of cloud architecture, whether single cloud, hybrid cloud, or multi-cloud, significantly impacts FinOps practices. Additionally, FinOps leverages technologies like FinOps as Code, Terraform, Kubernetes, and cloud cost management platforms to automate and streamline cloud cost management, offering tools for visibility and optimization across multiple cloud providers.