In this guest article by George Arezina, Independent Global ITAM & FinOps Consultant, George explains why ITAM should have a seat at the FinOps table.
I think we can all agree, the use of public cloud (AWS, Azure, GCP, OCI) during the pandemic exploded, whilst organizations scrambled to ensure their IT infrastructure was able to handle the heavy workloads, that applications were accessible, and that their organizations continue to function business as usual. However, this explosion of public cloud use was already in the making before the pandemic and mainly because many IT organizations were looking to:
- control IT costs
- pay for what they need
- flex up/down
- stay up to date
- IT security
- reliable and optimized technology
- innovate and adapt
- access from anywhere.
The pre and post pandemic cloud usage as a result of organizations adopting the use of public cloud at unprecedent levels, in turn necessitated changes in the way different parts of the organization, such as IT, Finance, Procurement, and Business Stakeholders interact with each other and manage their IT spend. This change in process has driven the need for a new terminology around Cloud Financial Management or otherwise known as “FinOps”. FinOps is an evolving cloud financial management discipline and cultural practice that enables organizations to get the maximum business value by helping engineering, finance, technology, and business teams to collaborate on data driven spending decisions.
As an ITAM practitioner and leader, I ask myself does ITAM have a SEAT at the FinOps Table? And the answer is, “YES”, absolutely, but that seat will not fall out of the sky nor have your name on it, you’ll need to work hard internally with FinOps and Cloud Competency Center of Excellence teams to not only acquire it but also retain it. How do you acquire and maintain the seat? By demonstrating the value ITAM bring to FinOps and closer cross-organizational collaboration and trust.
When we compare the FinOps 6 principles to ITAM you’ll quickly notice that both practices have much in common.
- Teams need to collaborate
- Everyone takes ownership for their cloud usage
- A centralized team drives FinOps
- Business value of cloud drives decisions
- FinOps reports should be accessible and timely
- Take advantage of the variable cost model of cloud
- Teams need to collaborate
- Everyone takes ownership for their SOFTWARE usage
- A centralized team drives ITAM/SAM
- Business value of SOFTWARE INVETMENTS drives decisions
- ITAM/SAM reports should be accessible and timely
- Take advantage of the variable SOFTWARE SUBSCRIPTION cost model
For both practices to be successful, they need:
- executive sponsorship
- play a central function
- buy-in from a range of companywide disciplines (Finance, Engineering, Technology etc)
- divide the work and milestones into measurable chunks (don’t Boil the Ocean)
- apply the 80/20 rule (80% processes/ 20% tools), essential to establish the right processes and governance framework, including roles and responsibilities
- apply continuous improvement
SAM/ITAM has achieved most of the above functions to a high degree in most successful SAM/ITAM implementations and certainly brings a lot to bring to the table in terms of sheer experience in software allocation, procurement, optimization and business alignment. FinOps requires those skills and it is up to us, as SAM/ITAM professionals to ensure we demonstrate the value and get involved in the world of cloud financial management.
FinOps is an evolving cloud financial management discipline and cultural practice that enables organizations to get the maximum business value by helping engineering, finance, technology, and business teams collaborate on data driven spending decisions. FinOps is not about saving money, but rather spending money wisely and efficiently, therefore SAM & HAM as a sub-practice of ITAM are well placed to not only secure a seat at the FinOps table but showcase the years of experience they bring with us relating to optimizing cost, albeit in the traditional environment. Our challenge as SAM/ITAM professionals are to adapt to the speed and fluency required by the FinOps world and hence a close collaboration could only lead to a win-win partnership.
If you’d like to learn more about FinOps and what it means for ITAM, please attend the Wisdom EMEA IT Asset management conference 15-16th June 2022 where George will be presenting on this topic alongside his peers in the ITAM industry, Salome Hugo from First National Bank (South Africa) and Rich Gibbons from ITAM Review. Their session titled “FinOps – what does it mean for ITAM?” will take place on June 15th from 12.00-13.00.