Embrace FinOps for AI Success

workforce
  • Publication
  • 8 Minute Read
  • March 27, 2024

Did you know that, on average, companies waste 30% of their cloud spend due to inefficiencies? As more businesses adopt artificial intelligence (AI) and migrate to the cloud, managing cloud spend has become a critical challenge. In this era of optimising operations and minimising costs, organisations are constantly seeking innovative ways to leverage AI advancements like Open AI GPT-3.5 and GPT-4 to revolutionise their business processes. However, it's important to recognise that choosing the right AI model not only impacts performance, but also has significant cost implications. This is where the concept of FinOps comes into play.

FinOps, an abbreviation for Financial Operations, is a well-established methodology that combines financial management principles with cloud operations to empower businesses with enhanced control over their cloud spending. By implementing FinOps practices, organisations can proactively manage and optimise their cloud costs, ensuring that each euro spent delivers maximum value. With a focus on optimising costs, enhancing efficiency, and ensuring accountability in cloud spending, FinOps presents a strategic approach to effectively manage cloud spend, especially with regards to the growing adoption of AI and cloud technologies.

Decoding cloud provider costs: a case study of Microsoft Azure

When it comes to cost transparency in the realm of AI and FinOps, it's essential to understand how different cloud providers handle this aspect. Let's take a closer look at one of the major cloud providers in Belgium: Microsoft Azure. 

Azure Migrate and Modernise, along with Azure Innovate, offer a range of benefits to customers. These include assessments, proof-of-concepts, and deployment assistance from experts. Customers can take advantage of expert guidance, partner funding, Azure credits, migration tooling, and technical skilling. When it comes to AI (pilot) projects, Azure AI services provided by Microsoft Azure offer a convenient way to quickly implement AI proof-of-concepts or minimum viable products (MVPs). However, they have limitations when it comes to individual insights on costs per AI resource. Gaining an understanding of the individual cost per resource can become challenging and time-consuming, whereas considering the cost of your project and close monitoring after deployment are crucial parts of the process. This is where FinOps can bring a significant improvement. 

Four key areas for optimising cloud efficiency in FinOps

To efficiently implement FinOps, a cross-functional approach is important. PwC has identified four key domains that are essential for achieving cloud efficiency in FinOps. 

These domains provide a comprehensive framework for organisations to effectively manage and optimise their cloud spend.

Process & Controls

The first domain focuses on establishing foundational processes and governance for efficient cloud financial management. This involves implementing robust controls and mechanisms to ensure accountability, transparency, and compliance, providing organisations with a solid foundation for managing their cloud costs.

People & Organisation

The third domain recognises the significance of establishing the right structure, roles, and skills for managing and optimising cloud spend. By aligning people and skills effectively, organisations can drive cost optimisation initiatives and enhance overall efficiency in their cloud management practices.

Cloud Architecture

The second domain emphasises the importance of implementing cost-efficient architecture for public and hybrid cloud environments. By building a solid infrastructure and minimising costs, organisations can maximise performance and achieve optimal cost efficiency with the guidance of PwC's expertise.

Enabling Tools

The fourth domain highlights the importance of implementing tools for effective cloud spend management. This includes leveraging AI-powered analytics and cost optimisation tools to gain real-time insights and make informed decisions that drive cost efficiency.

By incorporating these four domains into a cross-functional FinOps practice, organisations can establish a comprehensive approach to managing and optimising their cloud spend.

Driving efficiency and innovation with FinOps

By now, it should be evident that FinOps is pivotal for developing AI models for your business. However, the role of AI extends beyond this – it can also significantly impact your FinOps practices. By harnessing the power of AI-powered analytics and cost optimisation tools, organisations can unlock real-time insights, identify cost-saving opportunities, and maximise their return on cloud investments. AI, when combined with FinOps, empowers businesses to leverage the full potential of the cloud, driving innovation and gaining a competitive edge. With AI-driven cost analysis and predictive modelling, organisations can accurately forecast and optimise their cloud spend, ensuring that resources are allocated efficiently and cost-effectively. Additionally, AI automates and streamlines FinOps processes, enabling proactive monitoring, anomaly detection, and automated cost optimisation. This integration of AI and FinOps not only enhances cost efficiency but also enables data-driven decision making, optimised resource allocation, and achieve agility in cloud management strategies.

Conclusion

As more companies adopt AI and move to the cloud, managing cloud spend becomes a critical challenge. FinOps provides the framework and strategies to optimise costs, enhance efficiency, and drive innovation in the cloud. PwC's proven methodology, accelerators, and expertise can support you in establishing a mature FinOps practice. Embrace FinOps, leverage our expert guidance to unlock the full potential of AI in the digital era.

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Contact us

Xavier Verhaeghe

Xavier Verhaeghe

Partner, Technology Consulting, PwC Belgium

Tel: +32 495 59 08 40

Michiel De Keyzer

Michiel De Keyzer

Director, PwC Belgium

Tel: +32 494 88 95 74

Thomas Van Steyvoort

Thomas Van Steyvoort

Senior Manager, PwC Belgium

Tel: +32 471 20 02 48

Connect with PwC Belgium