What's new in Cloud FinOps?
Stephen Old and Frank Contrepois get together to discuss what's new in the world of cloud when it comes to FinOps. There are two monthly episodes, one where we'll discuss the top stories we've found from this month and a second episode where we bring in a friend of the show to talk to us about a topic of their choosing.
What's new in Cloud FinOps?
WNiCF - Interview with Dr James Mitchell - Financial language in FinOps and isomorphic economies
"An isomorphism is the fancy maths word for an analogy." - Dr James Mitchell
Dr. James Mitchell, a commodities trading and renewable energy expert, joins Stephen and Frank to discuss FinOps financial language. He draws parallels between cloud computing and electricity economies, offering insights into future trends. The conversation explores market differences and the need for finance-engineering collaboration.
James decodes cloud vendors' technical jargon, revealing financial roots. "Savings plans" and "reserved instances" are actually forward contracts. The discussion then shifts to unit economics' universal applicability across industries.
Optionality and flexibility emerge as key considerations in cloud pricing. The hosts emphasize managing commitments like a financial portfolio for optimal outcomes. This approach bridges the gap between technical and financial perspectives in cloud operations.
Key takeaways:
- Understanding financial language and communicating with finance professionals is crucial in FinOps.
- One can apply the concept of isomorphic economies to the cloud market to gain insights into its evolution and economics.
- Regulating the global cloud computing industry is challenging due to its global nature and lack of a competent authority.
- Better communication between finance and engineering teams is essential in FinOps. Building bridges between finance and engineering teams is crucial for effective communication and collaboration.
- A common language and understanding of financial terms is beneficial for both teams to work together effectively.
- Unit economics is a fundamental concept in finance and can be applied to various industries.
- Considering optionality and flexibility in pricing strategies is crucial for optimizing cost efficiency.
- Managing commitments as a portfolio can lead to better financial outcomes.
