Framework / Domains / Quantify Business Value / Benchmarking
Using efficiency metrics to evaluate cloud optimization and value between parts of the organization or against industry peers to inform decision-making and align FinOps with business objectives.
Determine Organizational Benchmarks
Benchmarking allows organizations to compare unit metrics and KPIs for important aspects of cloud value and optimization both internally between different teams, and externally with other organizations using cloud in similar ways.
FinOps teams should work with Leadership, Product, and Engineering personas to identify, or define unit metrics or KPIs that would provide insights into the organization’s cloud use by being benchmarked.
Internal benchmarking between different segments of the organization, or between product or engineering teams can assist in decision making related to cloud value and optimization. Internal benchmarking programs can be implemented with clear definition of benchmarked metrics, transparent communication of goals and objectives, accurate data collection and dashboarding, supportive management, and can be more effective with gamification or incentive programs to drive desired behavior.
Organizations can also perform benchmarking of their cloud metrics with other organizations. External benchmarking should be performed carefully so as to protect pricing or usage information which might be sensitive to share. Because many organizations are reluctant to share detailed information publicly, it can be difficult to implement external benchmarking in detail also. The FinOps Foundation community, including Enterprise Membership, can often provide opportunities to share information informally with similar organizations. State of FinOps data can provide useful insights into other FinOps practices. Analysts, large system integrators, and cloud service providers can sometimes also share aggregated or summary information on certain types of cloud usage.
Every organization’s cloud usage will be unique. Just as there is no perfect FinOps team size or structure, benchmarking should only be one activity for assessing an organization’s cloud value and efficiency. FinOps teams must balance this capability with other mechanisms of understanding cloud value, and enabling the organization’s leadership with an understanding of the cloud investment. As with many FinOps practices, perfect information is rarely available and successful organizations continuously review their benchmark KPIs, making decisions based on the information they have rather than waiting long periods for data to improve.
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