According to this year’s State of FinOps report, across cloud providers, organizations employ 4.1 cloud cost-management tools. Four point one! We’ve observed a similar trend with our own customers. On average, they report using four tools — native, third-party, and homegrown — to make sense of their cloud bills. Astoundingly, we’ve learned from some of larger enterprise customers that they may have 10 or more cost-management and operation tools. When companies get in this situation, making decisions is a challenge.
The industry is taking note with efforts to standardize open billing data. And organizations like yours are going to great lengths to demystify their cloud spend. But when it comes to multicloud reporting, enterprise customers still often face the age-old question : Buy or build?
To illuminate the topic, we talked to one enterprise customer, UKG, which provides human capital management (HCM) and workforce management solutions. Recently, their Director of Cloud FinOps, Peter Crenshaw, joined us on the Framing Up FinOps podcast to share his thoughts about UKG’s Cloud FinOps journey and in-house cost-management tooling.
Building an advanced reporting solution
About three years ago, when leaders at UKG decided they needed to clarify the organization’s cloud costs, they approached Crenshaw to begin reporting on Google Cloud spend. “We had a massive product deployed but didn’t understand the bills,” Peter explains. “Eighteen months or so ago, we ran into issues finding a third party that could process and manipulate data based on our reseller discounting, then present it in a way that would work.”
Like many enterprises, UKG has a large cloud footprint. They had multiple and disparate advisees, advisors, providers, and tools, each producing data that didn’t match up. Together with teammates, Peter started a small FinOps practice. In his words, they began with “rudimentary Excel and menial efforts.” They needed to decide whether to build their own cost-management solution or to go with a third-party vendor. Ultimately, they partnered with Google Cloud — first, to find a solution to view current costs, then to expand on its use as their team and FinOps practice matured.
Since then, the official team has grown from one to four. And they’ve consolidated their cost-management tooling to align with industry averages. To better understand and report on UKG’s cloud spend, Peter and his team worked with Google Cloud to build an advanced reporting solution.
Managing cloud cost reporting with Looker and BigQuery
For cost reconciliation and granular visibility into cloud cost breakdowns, Peter and team elected to build their solution on Looker, a platform designed for insight-powered workflows and applications. Additionally they leveraged Cloud Billing data to BigQuery for advanced billing data at the resource level and the Google Cloud billing console for validation.
In assembling UKG’s FinOps team, Peter departed from industry recommendations to establish a cross-functional team with engineers and cloud financial analysts. Instead — leveraging the strengths of his organization — his team partners with the in-house experts of their SRE teams. “We looked at FinOps as an analytics team. We’re not engineers, and we don’t build tooling or software. . . We know and can show the data and partner with teams that have those skill sets to make strides and advance,” he explains.
PO processing time drops from weeks to a day
When we asked Peter about the benefits and outcomes of building tooling on Looker, he underscored the depth of visibility, the ability to alert teams to real-time data, and increased invoicing efficiency. Currently, he and the FinOps team have been evangelizing the advantages of labeling. With real-time reports and demos, they’re showing internal teams the true costs of running various components, services, or products. These data and demos have elicited a measure of FinOps buy-in across the organization and have begun to precipitate a culture shift.
Additionally, UKG’s Finance and FinOps teams are seeing the biggest wins in the reduction of time spent on tasks. PO invoice processing at UKG used to take as many as 2 weeks in the payment cycle for approvals. But with advanced reporting and custom templates, Peter and his team can process their own data within 30 minutes of receiving an invoice. Organization wide, UKG has reduced PO invoice processing time from two weeks to one day.
As Peter notes, and as we’ve shared here before, getting visibility into cost drivers is oftentimes the first and most powerful step in the cloud cost-optimization journey. “The data and visibility has been [most] impactful with my team. Before, we were drowning in spreadsheets and watching Excel crash every day,” he recalls. “Our reporting is much easier now with the same inputs, same reports, and same visibility. But also, the entire org is benefiting as we’re peeling back the layers, seeing what’s under the hood. [We’re] able to tell people what they have, what their costs are.”
Transitioning to a value-stream model
UKG is transitioning to a value-stream operational model, where a product owner is responsible for their own cloud budget. Previously, they had one cost center across the entire cloud bill, then manually completed journal entry to assign cloud costs. With the new system, which will eventually incorporate labeling and chargebacks directly into POs, individual teams will be responsible for their own cloud costs.
But labeling remains an organizational challenge. As such, the challenge to the FinOps team will be to clearly articulate costs, break them down month by month, and not only enter them but also assign them in the payment system. “The granularity of the reporting isn’t as it could be, but we’re getting there,” Peter says.
Build, buy, or both?
Whether your organization is a well-established enterprise or a small business just getting started with a Cloud FinOps practice, determining whether to build, buy, or both is really about understanding your business objectives, then selecting the right tools to meet them.
There are plenty of out-of-the-box Google Cloud billing tools to make sense of your cloud spend. But if, like UKG, your enterprise is considering or working on building an advanced reporting solution, we recommend a rationalization exercise to understand what you have as a first step.
To optimize reporting tools, we’ve found that organizations must often work backward to understand their desired outcomes and business objectives. Some critical questions to consider include:
What are the goals of your FinOps org?
What are you trying to accomplish in the near and long term?
Where is your team’s time best spent?
Do you have the appropriate tool set to augment your time and accomplish your goals?
Hopefully, you’ve taken away some useful insights to help you get more value from your cloud investment. If you need support to determine the right solutions for your company, we’re happy to help. There’s much more to learn, so please remember to join us every other week for our newest episode of Framing up FinOps on Twitter Spaces.
Special thanks to Googlers Sheri Cunningham, Cloud FinOps Team Lead, and Nick Davidson, Technical Account Manager for UKG, as guest speakers on our Framing up FinOps.
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