What is FinOps? A Guide to Cloud Financial Management

FinOps, short for "Finance and DevOps," is a cloud financial management discipline that helps organizations optimize cloud spending through collaboration between engineering, finance, technology, and business teams. Instead of treating cloud costs as an afterthought, FinOps ensures that every team takes ownership of its cloud usage while following best practices set by a central FinOps function.

At its core, FinOps is about breaking down silos and enabling real-time financial decision-making. By removing blockers, it empowers engineering teams to deliver features and applications faster while ensuring cost efficiency. It is an iterative process that evolves over time—organizations typically start small and scale their FinOps practice as business needs grow.

FinOps involves multiple stakeholders across the organization:

• Executives oversee financial goals and ensure cloud spending aligns with business strategy.
• Engineering teams focus on optimizing cloud usage while maintaining performance.
• Finance and procurement teams manage budgets, forecast costs, and ensure financial governance.
• FinOps practitioners act as the bridge between technology and finance, driving best practices.

FinOps vs. DevOps – What’s the Difference?

While DevOps focuses on improving collaboration between development and operations teams to accelerate software delivery, FinOps extends this collaboration to financial management. The goal of DevOps is to optimize speed and reliability, while FinOps ensures that cloud resources are cost-efficient and aligned with business objectives.

Think of it this way:

• DevOps streamlines development and deployment to make software delivery faster and more reliable.
• FinOps provides financial visibility and cost control to ensure cloud usage remains efficient and optimized.

Organizations that successfully integrate both DevOps and FinOps can scale their cloud operations without unexpected cost overruns—balancing agility with financial discipline.

What Problem Does FinOps Solve?

Cloud computing provides unmatched flexibility and scalability, but it also introduces complex financial challenges. Without proper cost management, organizations often struggle with unpredictable expenses, inefficient resource allocation, and a lack of financial visibility.

Key Challenges Without FinOps

• Uncontrolled Cloud Spending – Engineering teams provision cloud resources as needed, but without financial oversight, costs can quickly spiral out of control.
• Lack of Financial Visibility – Finance teams often lack real-time insight into cloud expenses, making budgeting and cost forecasting difficult.
• Misalignment Between Engineering and Finance – Developers prioritize performance and reliability, while finance teams focus on controlling costs. Without a structured approach, these conflicting priorities lead to inefficiencies.
• Inefficient Resource Utilization – Organizations frequently over-provision resources, pay for unused capacity, or miss opportunities to optimize pricing models.

FinOps solves these challenges by introducing a framework for financial accountability in the cloud. It enables organizations to track, analyze, and optimize cloud costs in real time, ensuring that spending aligns with business goals. By fostering collaboration between teams, FinOps turns cloud financial management from a reactive process into a proactive strategy.

FinOps Practice Maturity

FinOps is an iterative practice where the maturity of any given process or activity improves over time. Organizations typically start with a reactive approach, addressing problems as they arise—this is known as the "Crawl" stage. Over time, as they gain more experience and implement best practices, they move toward a proactive and strategic FinOps approach.

The Three Stages of FinOps Maturity

🔹 Crawl (Reactive Stage) – Organizations identify cost issues after they occur and respond accordingly. FinOps is not yet fully embedded in the workflow, and teams rely on basic tracking and reporting.

🔹 Walk (Proactive Stage) – Cost awareness grows, and organizations start incorporating FinOps principles into cloud architecture and engineering processes. Decision-making begins to factor in financial considerations before changes are made, rather than just reacting to costs after the fact.

🔹 Run (Optimized Stage) – FinOps is fully integrated into cloud operations, and automation plays a key role in cost control. Teams use real-time data and analytics to make informed financial decisions on the fly. At this stage, FinOps is a strategic advantage, enabling optimized cloud usage without compromising innovation.

The "Crawl, Walk, Run" approach allows organizations to start small and gradually expand their FinOps capabilities. Instead of waiting for full implementation, teams can take quick actions, assess their impact, and refine strategies as they scale FinOps across the organization.

FinOps Stakeholders: Who is Responsible for FinOps?

FinOps is not the responsibility of a single person or team—it is a cross-functional practice that requires collaboration between multiple departments.

Key Stakeholders in FinOps

1.  Executives – Align cloud investments with business objectives and ensure spending supports long-term growth.
2. Engineering & DevOps Teams – Optimize cloud resource usage while maintaining performance and reliability. They must balance cost-efficiency with technical requirements.
3.  Finance & Procurement Teams – Manage budgets, track cloud expenditures, and establish cost governance policies. They also negotiate contracts with cloud providers.
4.  FinOps Practitioners – Act as the bridge between finance and technology, ensuring best practices are followed and teams have the right visibility into cloud spending.

While a central FinOps function may exist to provide guidance and best practices, the success of FinOps relies on collaboration between all relevant teams and individuals. Every department must take ownership of its cloud costs to create a financially sustainable cloud strategy.

FinOps Principles

• Teams need to collaborate
• Everyone takes ownership for their cloud usage
• A centralized team drives FinOps
• Reports should be accessible and timely
• Decisions are driven by business value of cloud
• Take advantage of the variable cost model of the cloud.

Sela provides FinOps services to its cloud customers in several models (proactive, on-demand, and as-a-service). The goals of our FinOps team align with the FinOps principles, and our mission is to optimize the cost of cloud usage for our customers. Sela’s customers receive a free multi-cloud cost allocation and optimization tool (Anodot for Cloud Cost) and continuous support from our FinOps engineers in their journey to optimize their cloud cost.