Crawl, Walk, Run: where to start with FinOps in your Azure cloud environment

In the dynamic world of cloud computing, the importance of FinOps as a critical framework for managing cloud expenditure is becoming increasingly apparent. 

Tom Burnip, Azure Solutions Architect, has witnessed first-hand how effectively implementing FinOps can transform not only the financial accountability but also the overall culture of an organisation. In this blog, discover how he’s been putting the FinOps framework into action with a client using the ‘crawl, walk, run’ maturity model to drive engagement.

Understanding FinOps

Organisations often move to the cloud using a “lift and shift” approach. This can be because of a time constraint such as a business-critical event like the closure of a data centre. However, this means there is little time to consider cloud cost optimisation opportunities or a robust Azure governance strategy. That’s where FinOps comes in.

To quote the FinOps Foundation: “FinOps is an operational framework and culture practice which maximises business value.” It uses a set of principles to determine how FinOps is practiced in an organisation and a set of domains and capabilities to determine the outcomes and how to achieve them, respectively.

The crawl, walk, run approach 

The FinOps framework uses the “crawl, walk, run” maturity model to assess the current state of an organisation’s FinOps practice to get a better picture of current capabilities and identify areas that need improvement.

It’s important to note that the goal is not to achieve the advanced ‘run’ stage in every domain or capability area, but to focus on the most relevant areas in an iterative manner. 

Case study: FinOps in action 

At Advania, one of our clients has identified the need for FinOps as a priority across their organisation – I’ve been supporting them with the early adoption of FinOps. The client’s primary focus at this early stage is cost tracking and cost savings, two important elements that fall across the capabilities in the Understanding Cloud Usage & Cost, Quantify Business Value, and Optimise Cloud Usage and Cost domains. Let’s look at some examples of how this is being achieved using the “crawl, walk, run” maturity model.

Crawl: laying the groundwork

The ‘crawl’ stage involves establishing a baseline for cloud expenses. For this client, it began with an assessment of current cloud usage and understanding where costs are incurred using cost data ingestion, real-time reporting and analytics. 

Tagging strategy

A consistent tagging strategy for Azure resources is essential so that the resource costs can be attributed to the resource owners and charged back if required.

A review of the client’s tagging strategy identified tags that were no longer required or contained data that was out of date, such as resources that have moved to a different resource owner, but the tags have not been updated to reflect this. Some resource could not be associated with any resource owner and this results in cost that cannot be allocated.

In this scenario, the recommendation was to conduct a detailed review of the tagging strategy to resolve these issues and use Azure Policy to reinforce tagging rules.

Cost visibility

The client initially used Azure Cost Management tools to view costs but worked with Advania to develop its own sophisticated cost tracking tool that better aligns with its internal structure and tagging strategy.

The tool uses Power BI to produce reports that enable users to drill down into where costs are incurred. As the client had to absorb additional tenants and increased costs, this in-depth cost tracking became invaluable. It means that cost-saving efforts can be targeted on those departments and resources that lead to the highest cost savings.

Going a step further, we’ve helped the client develop an additional tool that is used to record cost savings such as resource decommissions, resizing and bulk savings achieved through the use of long-term discount Reserved Instances.

The key benefit of the new tool are the reports that are available using Power BI. For example, the senior leadership can monitor the cost reductions being achieved and the progress against cost reduction targets in real-time.

There is a host of good practice that can set organisations up for success in this ‘crawl’ stage and Advania has helped the client adopt these. While cost savings were the focus, the client has also recognised that adopting sustainable processes is equally important. This where the focus switches to the Manage the FinOps Practice domain with capabilities such as FinOps Practice Operations, and Cloud Policy & Governance.

Walk: building the foundation

In the second ‘walk’ phase, the client focus is on enhancing financial operations – this is the stage that we’re at right now with the client.

Optimising resource usage

Using tools like Azure Advisor and Power BI, we’re looking at cost-saving recommendations. These include decommissioning and resizing of resources and bulk saving options such as Hybrid Benefit and Reserved Instances. 

Advania developed a five-day process that the client’s cost saving team use to analyse all departments Azure resources and identify cost savings recommendations which the department can then implement.

Cost allocation models

This client excels notably in the area of cost allocation. Creating clear cost allocation models allows organisations to take ownership of their budgets. This is critical because it helps them understand which resources they are using and how those resources impact overall costs. This ownership fosters a culture where teams are more mindful of their resource usage and encourages proactive cost management.

While native, out-of-the-box tools like Azure Advisor are popular with many Azure customers, this client created an in-house tool to achieve precise cost allocation. It also includes features to capture budgets, which is another pillar of the FinOps framework. 

The next step to reach the ‘run’ stage would be introducing automated processes that alert you when you’re approaching your budget so that you don’t overrun. 

Run: achieving maturity

In the third ‘run’ stage, the true differentiator for the client is taking the resource optimisation work to the next level. For example, this could be setting up an automated system that alerts admins as they approach set budgets and scheduling in reviews that improve forecasting against budget performance to ensure the service owners understand what drives unexpected forecast changes.

We’re in the early stages of this third ‘run’ phase with the client. While the cost analysis and optimisation work is underway, the next step is modernisation, including application processes and databases. This means moving resources from Infrastructure as a Service (IaaS) to Platform as a Service (PaaS) such as containerisation. This is how we’re driving the change to cloud strategies aimed at identifying additional cost-saving opportunities through transformation.

Adopting a FinOps mindset

FinOps is an ongoing effort. It’s not a one and done project – it requires regular assessments to identify new areas for improvement based on changing business needs or cloud usage patterns. Periodic reviews and FinOps aligned processes help ensure that you remain agile and responsive to new challenges and opportunities while driving sustainable business value. 

Using the ‘crawl, walk, run’ maturity model to optimise your cloud

The ‘crawl, walk, run’ maturity model offers a clear path to optimising your cloud environments. By fostering a culture of financial accountability and continuously monitoring costs, you can make significant savings while ensuring your resources are being used efficiently. 

As you continue your cloud journey, embracing FinOps will be key to maximising the value of your environment. It’s clear from Advania’s work with this client, having a structured approach to FinOps in the cloud is truly valuable and can lead to more sustainable and efficient practices.