Vasilio Markanastasakis
FinOps Foundation
Key Insight: The FinOps Framework has been updated to reflect the present-day practice of FinOps and to better align activities with best practices that maximize the business value of cloud. The 2024 revisions include updates to the definition of FinOps, changes to simplify the Framework organization, improvements to the Domain and Capability names, and an augmented set of Personas and Capabilities that are central to modern FinOps practices.
Watch the replay of the March 2024 FinOps Foundation Summit to hear explanations for all of these changes.
The FinOps Framework is the operating model for FinOps that guides you as you develop your practice. This open-source Framework is built by the community, for the community, and as such, it is periodically updated to reflect the evolution of their practices. Over the past few months, the Technical Advisory Council (TAC) codified and ratified these 2024 revisions to the FinOps Framework.
Why is the Framework changing?
The original draft of the Framework was released in 2021, and since that original draft was released, the FinOps community has grown to tens of thousands of people who manage the value of the cloud for their organizations. Our community members bring a wealth of knowledge, perspectives, and best practices from their own cloud operations. It is these perspectives and experiences that drive the evolution of terminology, concepts, and ultimately, the practice of FinOps.
Conversations with our community reveal that terms like “Cloud Cost Optimization,” “Cloud Financial Management,” and “Cloud Cost Management” have become less common and do not go as deeply into the critical collaboration required between technology and business teams that a modern FinOps practice requires. Moreover, the scope of FinOps has expanded to intersect with other IT disciplines, including practices like cloud sustainability, IT Asset Management (ITAM), IT Financial Management (ITFM), and IT Service Management (ITSM).
As cloud operations evolve, so do the concepts, structure and language employed by the FinOps Framework. The 2024 revision of the FinOps Framework incorporates the new activities that FinOps practitioners are performing today.
The 2024 Revision of the FinOps Framework
The 2024 revision marks a significant advancement to the FinOps Framework and includes updates to the definition of FinOps, simplified Domains, augmented Capabilities and expanded Personas. (Download poster.)
Updated Definition of FinOps
Last month we announced that the TAC approved changes to the definition of FinOps to better reflect current realities for the FinOps community, such as the shift from a focus on cost to a focus on value, and the expansion of FinOps beyond IaaS to other variable cloud costs. This update was the tip of the iceberg, and now that the TAC has approved the remaining changes to the Framework, we are excited to surface them today.
Persona Updates
FinOps Personas have been grouped into Core Personas and Allied Personas. These groupings reinforce that implementing the FinOps Framework requires many stakeholders to work together collaboratively in your organization. Some Personas participate directly on a FinOps team, while others are internal customers of the FinOps team, or become FinOps champions for their discipline.
Core Personas
The organizational roles for Core Personas that are directly involved in the practice of FinOps have remained unchanged. However, a few names have been simplified. Engineering & Operations and Business/Product Owner have been changed to Engineering and Product respectively to represent areas of FinOps activity rather than role titles. The Executive Persona has been renamed Leadership to reflect that organizational alignment across all leadership roles is needed to overcome FinOps challenges and connect cloud technology decisions with business outcomes.
Updates to the Core Personas are summarized here:
Allied Personas
In addition to Core Personas, organizations may have roles that are not directly involved in the practice of FinOps. These Allied Personas work within traditional or emerging disciplines and may coordinate with FinOps Practitioners. Their roles align with the Intersecting Disciplines Capability, which outlines where activities in other disciplines intersect with FinOps, such as:
- Sustainability
- ITAM (Information Technology Asset Management)
- Security
- ITFM / TBM (IT Financial Management / Technology Business Management)
- ITSM / ITIL (IT Service Management / IT Infrastructure Library)
Updates to the Allied Personas are summarized here:
Domain Updates
The Framework Domains represent the four fundamental business outcomes that organizations should achieve from practicing FinOps: Understand Cloud Usage & Cost, Quantify Business Value, Optimize Cloud Usage & Cost, and Manage the FinOps Practice. The updated Domains provide a succinct headline – Understand, Quantify, Optimize, and Manage – that drives how we communicate the value strategy concepts that encompass FinOps, shifting focus from methods of the practice to outcomes for the business.
Quantify Business Value – Performance Tracking & Benchmarking and Real-Time Decision Making merged to become Quantify Business Value. This new Domain name encompasses any measure of business value, including carbon credits, dollars, time, operational value, etc. This update also emphasizes the need to make data-driven decisions focused on cloud value.
Optimize Cloud Usage & Cost – Cloud Rate Optimization and Cloud Usage Optimization merged under this new Domain name, harmonizing optimization activities to focus on the overall value to the business of delivering efficient cloud use.
Manage the FinOps Practice – Organizational Alignment was renamed Manage the FinOps Practice. The change allows flexibility to include activities that go beyond organizational alignment but are essential to improving the practice of FinOps (e.g. performing assessments). These activities reflect FinOps as a continuous practice.
Updates to the FinOps Domains are summarized here:
Capability Updates
FinOps Capabilities represent the areas of activity required to meet the challenges of the FinOps practice itself. They can be thought of as building blocks that enable, educate, and bridge actionable tasks across FinOps Personas, and align technology decisions with business objectives. Practitioners choose and arrange their blocks in different ways, resulting in unique context-relevant implementations of FinOps, constructed from the same core components.
With this update, the Framework Capabilities have been augmented to encompass all areas in which FinOps is practiced today. New Capabilities such as Licensing & SaaS, and Architecting for Cloud capture new challenges that practitioners face. Additional Capabilities relate to forming and running FinOps teams, and gaining organizational adoption of FinOps. Seven Capabilities were added and three were merged with existing Capabilities, bringing the Framework to a total of 22 FinOps Capabilities.
Four Capabilities remained unchanged:
Eight Capabilities were renamed with simpler names that make it easier to scan and find information.
Seven new Capabilities were added to reflect areas that FinOps practitioners are working in today.
Three new Capabilities were created by merging existing Capabilities to reduce overlap and simplify the Framework.
Conclusion
The 2024 revisions to the FinOps Framework mark a significant advancement in aligning activities with current best practices employed by the FinOps community. With updates to terminology, simplified structure, and expanded Capabilities, the Framework reflects the evolving landscape of cloud operations and the broadening scope of FinOps.
Community-driven contributions have played a pivotal role in shaping these revisions, ensuring that the FinOps Framework remains relevant and responsive to the needs of practitioners. The 2024 revisions to the Framework provide clearer guidance for building and managing FinOps practices within organizations and empower practitioners to navigate complexity, optimize resources, and drive value with greater clarity and confidence. We are excited to see these new updates help practitioners develop and mature their FinOps practices.
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