FinOps Foundation Research Shows Field of FinOps Expands as Companies Move to Cloud

More companies in more industries are starting and growing FinOps teams and practices as they shift to the cloud and seek a better handle on forecasting and planning cloud migration and spend, according to a new survey conducted by the non-profit organization the FinOps Foundation.

FinOps, the field of cloud financial management, is also emerging as a lucrative career. More than 45% of practitioners surveyed make over $100K a year with the average career tenure at three years.

The State of FinOps 2022 survey, which helps companies better focus and innovate around real-time cloud financial management, included more than 1,000 FinOps practitioners from around the world and companies representing more than $40 billion in collective cloud spend. It is the second annual “State of FinOps” report.

The State of FinOps

This year’s survey results underscore that Global 2000 companies continue to adopt FinOps and, while companies do so in a myriad of ways, the end result is a more scalable and successful FinOps culture and practice.

More than half of the respondents (54%) represent industries other than financial services and technology companies, indicating that FinOps is proliferating beyond the early adopters wanting to make sense of cloud costs. Respondents from industries included telecommunications, retail, manufacturing and Energy were included.

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Also, 45% of respondents represented organizations with 10,000 or more employees. FinOps practitioners report to CTOs (43%), CIOs (24%) and CFOs (17%), indicating its cross functional role, but there were also regional variances in reporting structures

“This survey validates that FinOps isn’t just a technical engineering discipline nor is it solely finance based. It’s a cultural one that brings together finance, engineering, product and management,” says J.R. Storment, executive director of the FinOps Foundation. “Coupled with the fact that most who responded were planning to nearly double the size of their FinOps teams in the next year, there are simply not enough skilled practitioners in this emerging field to fill all the open roles. What we learn from this work will shape how we continue to build and redefine best practices and education of FinOps for our global community of practitioners to fill that need.”

Leading Challenges, Activities

Not surprisingly, cost allocation (the ability to report back where cloud spend originated by team or business unit) was identified as the No. 1 priority by 39% of practitioners and it ranked among the top 3 priorities for 64% of respondents surveyed.

While cost allocation is, by far, the leading FinOps activity, it also poses a cultural challenge. Repeating the top result of last year, encouraging engineers to take action on cost optimization remains a top challenge for all companies, although this does alter when you split it out by maturity of the FinOps practice.

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Other Key FinOps Insights:

• Automation is on the rise, with just 25% of respondents reporting that they have no automation, down from 49% in last year’s survey. Of respondents who automate, budget overage notifications, reporting, and tagging hygiene are the most common things to automate.
• Barriers to FinOps automation are driven by technical resource availability (35%) and FinOps adoption (29%).
• The average FinOps team size is five, and teams are expected to grow. Many companies are in the early stages with 36% of respondents working on FinOps but lacking a team.
• FinOps is being promoted almost equally via executive directive (46%), organic adoption (45%), and grass roots (43%).

Along with concerns around cost, enabling automation, container cost reporting and reducing wasted and unused resources were noted as key challenges to tackle in the year ahead, especially among respondents representing more advanced FinOps practices.

“These challenges grow in complexity as spend and usage grows,” says Storment. “The FinOps Foundation community continues to tackle all of these challenges, creating practical guides and content for every member to use.”

The FinOps Foundation has more than 7,000 active members and practitioners contributing to an industry-leading framework, which includes best practices and learnings from innovative organizations and cloud providers such as the Mayo Clinic, Chevron, Target, Box, Expedia, Atlassian, HSBC and Google Cloud Platform.

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