Are your cloud teams having trouble talking to each other? Maybe the problem is that they’re not speaking the same language.
When I started my FinOps team, I eagerly started creating reports and sent them out to the business — but instead of helping my teams clarify our cloud spend, these reports created confusion.
The problem was, teams were reading them from their own perspective. The terms used in the reports didn’t make sense (or mean the same thing) to everyone. To make matters worse, teams had been tracking costs using their own methods of deciding which parts of the bill are theirs — this lead to differences of opinion on which reports were correct. Rather than bringing clarity and cooperation, the reports had the potential to create conflict.
A Common Cloud Financial Ground Is Essential
It was at this point that I understood the need for a common language, a common understanding for FinOps terms and a common set of reports that all teams use to track their spend and optimizations. A report filled with cloud-specific infrastructure terms that a finance team member doesn’t know or a report with cloud financial terms that my DevOps team hadn’t encountered before would always lead to confusion. We needed something that everyone could understand and look to as a source of truth.
Asking two different teams how to describe the costs of a service will show you just how important a common lexicon is. If you ask a finance team, they’ll use terms like usage, rates, costs and possibly utilization. If you ask an engineering department, they’ll refer to terms like service availability, reliability and available capacity. This difference is simply because of their separate areas of responsibility.
Cloud Has Changed IT — And Your Language Must Adapt
Back in the data center days, operations teams only interacted with costs when they proposed new equipment purchases. After that, their day-to-day job was about efficiency and performance of their services. Finance teams could ask procurement what spend was committed and which budgets it would be depreciated against. In the end, finance and operations teams didn’t need a common language simply because they didn’t talk that often.
Today, we distribute purchase approvals throughout our organizations. When we do so, we need to ensure all teams are using the same terms when describing costs, and that we don’t overload terms to mean different things. The language gets even more complex as we add in terms specific to cloud service providers, becoming almost incoherent when we have multiple cloud service providers and start switching between their vendor-specific nomenclature.
If every report needs to come with a dictionary of terms, or worse, someone to sit down and explain how the report works, then it’ll breed complexity and prevent team collaboration. People will refuse to give reports the time needed to understand them, the FinOps practitioner won’t have enough bandwidth to distribute reports, and the whole point of FinOps will be undermined.
Building Your FinOps Lexicon
In order to build a common language across your organization, your reports need to consistently use specific terms and your teams need to know how to correctly interpret those terms. While you might understand that divided costs are the same as cost allocation, someone else in your organization may think of them as two different things, and that miscommunication can cause a lot of confusion.
Whenever possible, it’s better to use existing language constructs instead of creating new terms for the team to learn. If a cloud service provider uses terminology that doesn’t align with your existing business language, then it’s best to translate this into a more accurate term before reporting out to your teams.
As an example, if you look at AWS’s detailed billing data, you’ll find blended costs and unblended costs. When reporting costs to your teams, it might not matter what these terms mean as long as cost allocation is done consistently. Removing the blended/unblended terms and using a standardized term of “cost” or “spend” will make reports clearer to teams and avoid countless conversations into what blended vs. unblended means.
Take the time to dig into this critical first step and establish a FinOps lexicon that works for your company. By doing so, you’ll decrease confusion, increase collaboration and improve the effectiveness of your FinOps efforts. It’s a critical first step that starts paying off with the very first report you send out.
Grow Your FinOps Skills and Language Base
Building a FinOps lexicon can seem daunting, but you don’t have to go it alone. Members of the FinOps Foundation are bringing their hands-on cloud and FinOps experience together to help build a more universal FinOps lexicon, one that can provide a solid base for companies everywhere as they roll out their FinOps initiatives.
Join us to get the insights you need to bring your team together — and to share your own hard-won expertise.