Cloud adoption has reached a new level of acceleration in today’s SaaS, IaaS, and PaaS worlds. As the benefits of cloud adoption become evident, adoption is also increasing. However, to make that transition a success, we need certain guidelines, best practices, and definitely some preparation! It is important that the whole organization is in sync and aligned for this change and transition to the cloud world. Let’s embark on this Cloud FinOps journey: enter the Cloud Center of Excellence.
We need a group of people from within the organization to help to make this transition successful. This team is known by different names in the industry:
Leading cloud providers, such as AWS, Microsoft Azure, and Google Cloud Platform provide so many products for the modern enterprise IT to make the move to cloud computing more compelling.
A Cloud Center of Excellence (CCoE) is a team of executives (CFO, CTO), IT Manager, Operations Manager, System Architect, Application Developer, Network Engineer, and Database Engineer. Typically the CCoE team consists of about ten members.
The CCoE team leads the introduction of cloud computing capabilities into an organization. This team is responsible for the following granular-level activities:
Good interpersonal and boardroom skills are an added advantage for the CCoE teams. CCoE teams should also be equipped with the capabilities to handle objections, resolve conflicts, and be able to communicate to executives about the transition, progress, etc.
The CCoE team help accelerates cloud adoption by:
A Cloud Center of Excellence (CCoE) is the best practice approach to drive cloud-enabled transformation.
According to Lydia Leong, Distinguished VP Analyst, Gartner, “Cloud computing still requires governance to protect the business and promote effective use.”
The cloud services are mostly controlled and influenced by business priorities rather than IT priorities. The challenge of governing the cost of these cloud services is that these services are not necessarily under the CFO’s control. Often, a huge percentage of IT spending on cloud services in businesses is outside the CFO’s control.
Cloud adoption calls for a major IT transformation, a shift in culture, and also a new way of managing and financing cloud costs. Need of a governance and control across the organization and a proactive team to take ownership and direction of the migration process also becomes inevitable because of this transformation.
A cloud center of excellence (CCoE) has become a method of performing that role.
CCoE teams are often mistaken as a team of experts who can be consulted for their knowledge of operating in the cloud. But in reality, a CCoE can be much more powerful than this. They can be the driving force of cloud transformation across the enterprise that is broad as well as deep.
It might sound very hypothetical, but asking the right questions can be a key to the CCoE success. Asking the right questions allows the CCoE team members to think about the problems and challenges they are trying to solve. This also allows the CCoE members to think and plan how they can make cloud adoption a cost-effective solution.
Left-shifting the ownership of cloud strategy and cloud-first mindset were some of the key areas of focus of the cloud adoption wave. However, since cloud adoption has seen a constant rise in the past couple of years, the direction of thought has shifted to how to get efficient in the cloud. There is more conscious effort that goes into choosing between IaaS, PaaS, and the serverless flavors of various cloud services. Here are some best practices organizations follow to achieve smarter cloud environments:
Cloud providers like Amazon Web Services (AWS), Google Cloud Platform (GCP), and Microsoft Azure Cloud offer homegrown solutions for visibility into costs. These tools individually are great options to get started with, but they are limiting in many ways.
Tracking the breakdown of an organization’s cloud resource consumption across business units and across public clouds streamlines the process of managing cost, compliance, and governance. Fundamentally, this is done through tags in AWS, labels in GCP, and so on. There are tools available on the market that offer features to offload the burden of tagging.
Leading tools for cloud cost management like CloudHealth, Cloudability, Cloudchecker, and Harness Cloud Cost Management have intuitive features to allocate and track costs. Harness offers Perspectives that can track costs across public clouds. It also provides recommendations to optimize costs, budgets for governance, and many more features all in the context of the selected resources in the perspective.
Harness also has anomaly detection techniques for costs, which is important to prevent snowballing. This also helps in identifying bugs in the code/unexpected behavior of applications. Anomaly Detection can be achieved by setting up and managing multiple daily budgets on each service/product. Tools with Anomaly Detection support can offload all the overhead and point you to exactly the crux of the issue.
Once organizations have visibility into costs at a Business Unit level, it becomes fairly straightforward to set up budgets and assign relevant stakeholders the ownership to manage costs. The interesting problem is that to effectively forecast costs, it is critical to identify the fixed costs in the cloud and the variable costs which are tied to business metrics. This will help organizations get to the unit economics of cloud cost, which is extremely important to make organizational decisions. Harness offers powerful BI Dashboarding capabilities to effectively create custom visualizations and forecasting models.
At Harness, the notion of CCoE is ever-evolving with every phase of growth. There is regular collaboration between finance, engineering, and operations teams. We dogfood our Cloud Cost Management platforms capabilities and act as the first customer for all Beta features.
Harness has leveraged BI Dashboarding capability to set up reports that feed into our financial models. This helps us make better, informed decisions and help forecast spend in proportion to growth. The notion of cloud cost and ownership and accountability has been left-shifted to the actual consumers of cloud cost: the RnD teams. Costs are available transparently for every team to look at. Each team has visibility into the inventory of resources they are using, and also the exact cost impact of running said resources.
There is some level of gamification involved in the product where we track all clusters through the notion of efficiency score, which is really in proportion to how efficiently the cluster is utilized. This motivates users to get more efficient with their clusters. Apart from the visibility aspect, functional teams also get contextual recommendations and also set up budgets for continuous governance.
The CCoE team offers the expertise and enables cross-functional team members to collaborate seamlessly. Since Harness is the only platform where Continuous Delivery is closely coupled with Cloud Cost Management, we leverage this to track cost changes with deployments. This allows us to identify bugs specific to certain builds and mitigate the risk of stability alongside costs.
A thoughtful implementation of a Cloud Center of Excellence can help your organization transition to a new cloud-operating world smoothly and successfully. To summarize, you would typically do the following:
An important point to keep in mind is that this is going to be an iterative process where you will learn, review, and adapt.
Harness’ Cloud Cost Management (CCM) is equipped with a lot of capabilities that can make your cloud adoption journey a success story:
If you want to understand more about Harness Cloud Cost Management and its offerings, check out the CCM Documentation. If you’re not at that stage yet but would still like to learn more about cloud cost savings, feel free to download our Cost Management Strategies for Kubernetes eBook. It’s free and doesn’t require an email address!
Thank you for taking the time to understand how you can benefit from implementing CCoE in your organization.
This article was written in collaboration between Rohit Reddy and Archana Singh.
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