In recent years, cloud financial management has evolved beyond what many cloud stakeholders anticipated. The overwhelm has led too many companies to struggle to accurately monitor, allocate, and optimize their cloud costs.
This issue cost companies about 30% of their cloud budgets in 2022 alone, according to Gartner.
With FinOps, you can prevent this bleeding without sacrificing innovation. Yet, taking a manual approach to FinOps can be inefficient and error-prone. Instead, you’ll want to use just the right FinOps tool for your needs. How exactly?
Well, let’s start from the beginning.
What Is A FinOps Tool?
FinOps aims to maximize business value by aligning financial accountability, technology, and people. A FinOps tool is designed to help you automate cloud financial management as a strategic function, not just to reduce cloud costs as soon as possible.
FinOps is to cloud financial management what DevOps is to software engineering; a cultural shift meant to maximize efficiency and return on investment on an ongoing basis.
The FinOps lifecycle involves three continuous components: Inform, Optimize, and Operate, according to the FinOps Foundation.
- The Inform phase aims to deliver the visibility you need to create shared accountability.
- The Optimize phase is meant to uncover efficiency opportunities and evaluate their value.
- The Operate phase helps specify and put into action processes that support the goals of business, technology, and finance.
A good FinOps tool can help you collect the cost data you need, analyze it in the context of your business, present it to the right stakeholders at the right time, and guide financial decisions to maximize your business value.
Why FinOps Matters?
Cost savings are just one aspect of FinOps. Practicing FinOps offers several more advantages, including:
Make data-driven cost decisions
Instead of relying on gut feelings or what your competitors are doing, FinOps empowers you to identify what, who, and why your cloud costs are changing. When you know the exact cost factors involved in running different aspects of your business, you can determine which levers to pull to produce the results you desire.
Generate more revenue
For example, by determining your Cost per Customer, you can understand which customer segments are profitable. Then you can decide to invest more in those that are profitable to open up new revenue streams.
Apply Engineering-Led Optimization
Unlike the traditional approach, which alienates engineering from finance discussions, FinOps encourages finance and engineering to collaborate on addressing waste at both the code/infrastructure and financial aspects.
Automate cloud cost management
FinOp emphasizes automating the process of bringing financial accountability to the cloud’s variable spend model. And with the right FinOps tool for your business, you can continuously monitor, analyze, and optimize your usage and related costs with minimal error and manual intervention.
Also, when you understand your cost per customer, you can more accurately calculate the gross margin per customer. If you discover your gross margin is at risk, you can decide to review your SaaS pricing for that client.
We’ve covered what FinOps is in more detail before, including how aligning finance and operations benefits SaaS businesses.
In this guide, we’ll share several of the best FinOps tools you can use to automate financial governance in the cloud — and the difference between FinOps and cloud cost management.
Cloud Cost Management Vs. FinOps: What Is The Difference?
Traditional cloud cost management has centered around conventional finance practices; surfacing cloud costs, rightsizing resources, and reducing cloud costs, sometimes at the expense of innovation or engineering velocity.
The major focus has been on reducing costs at all costs.
With FinOps, the focus shifts to cloud financial optimization or cloud cost optimization. Optimizing costs in the cloud goes beyond simply reducing spending in the cloud.
Rather, FinOps brings together financial professionals, software engineers, and FinOps tools to identify opportunities for cutting waste and maximizing profitability. Maximizing this profitability can also mean investing more in specific areas that deliver ROI.
Consider this:
While cloud cost management is a traditional approach to cost control, FinOps emphasizes maximizing business value, not just reducing costs.
How To Choose The Right FinOps Tool For Your Needs
Choosing a FinOps tool will require considering its capabilities, price, ease of use, customer support, and the ability to integrate with other tools.
Consider its ability to provide useful, immediately actionable insights. It should also help you understand your cloud usage patterns, trends, and anomalies.
That’s not all.
- Consider your organization’s needs. Do you need help with cost allocation, budgeting, forecasting, or cost optimization? You’ll want a FinOps tool that offers multiple relevant capabilities within a single platform. With fewer cost tools to manage, you can minimize complexity and tooling costs.
- Compare different tools. Before committing to a vendor, it is a good idea to shop around. The FinOps market is full of tools, from traditional cost management platforms to more robust unit cost intelligence tools. Here’s an example comparison of CloudZero vs CloudHealth vs Cloudability, as an example.
- Get buy-in from your cloud financial management stakeholders. FinOps is a team effort, so it’s imperative to get buy-in from all players, from engineering to finance to management. You’ll want to get everyone on the same page and agree on goals and expectations. Next, form a team and work together to ensure the success of the FinOps initiative. After that, monitor progress and review regularly.
- Get a tool that delivers granular, immediately actionable FinOps insights. Most cost tools present totals and averages. Instead, get a cloud financial optimization platform that delivers more precise cost intelligence. Instead of settling for total or average cost per customer, you can get immediately actionable insights such as Cost per Customer, Cost per Daily User, and Cost per Product Feature.
- Double-check a tool’s integrations, support, and documentation. You need a tool that has thorough documentation and support so you can get the help you need when you need it. It should also work well with your existing stack. This makes it flexible enough to accommodate your changing needs.
- Embrace continuous improvement. Keep track of what works and what doesn’t when you make changes to your environment. Monitor performance and troubleshoot any issues. Seek feedback from users to ensure the system is meeting their needs. Don’t be afraid to experiment with different approaches, too.
- Grab the demo to test the FinOps tool firsthand. You can read a lot about a tool’s capabilities. Putting it to the test and seeing how well it works with your workload and infrastructure is when the real assessment begins. Choosing the right FinOps tool can make all the difference between understanding your cloud costs and getting a surprise bill.
Key Features Of A FinOps Tool In 2024
FinOps tools offer a variety of features that manage and optimize cloud costs. Consider a tool with the following functionalities:
- Budgeting. Forecasting and creating budgets can be difficult due to the many services and resources in a cloud environment. FinOps tools create customizable budgets and use historical data to forecast future costs.
- Reporting. FinOps teams depend on reporting features to break down complex cloud bills. The tools can also create dashboards for specific departments and teams.
- Anomaly detection. FinOps tools use machine learning algorithms to detect unusual cloud spending and automate responses to certain anomalies.
- Granular tags. Granular tags help FinOps teams by clearly labeling cloud resources. This makes it easier to track spending and allocate costs to the right projects or departments. Tags also help identify untagged or misused resources.
- Custom cloud usage view. Each team member has different priorities on cloud usage and costs. FinOps tools provide custom views tailored to specific cloud services and business units, offering clarity and focus.
- Performance metrics. Performance metrics help track how various departments or applications use cloud resources. This lets teams understand where to make changes to save money and optimize resources.
- User-friendly interface. FinOps teams benefit from a user-friendly interface in a FinOps tool as it makes it easy to use and understand their cloud costs. It allows them to quickly find and analyze spending patterns, set budgets, and track performance without needing technical expertise.
- Integration. This fosters collaboration and data sharing between financial, operational, and IT management tools. FinOps tools offer APIs to integrate with existing tools and platforms. They also support third-party integrations with cloud platforms and DevOps tools.
The following tools can help simplify your FinOps adoption process.
What Are The Best FinOps Tools?
An effective FinOps solution will align finance and operations in a language they both understand.
To support this, you’ll want a tool that can source the right metrics for each team. It should also enrich that data with cost insights from multiple, relevant sources, such as infrastructure and app data.
It should also break down the cost data into the language of your business and stakeholders, such as cost per customer (finance), cost per feature (engineering), COGS (C-suite), and gross margin (investors).
Among the several outstanding cloud cost management tools out there, here are 15 that are excellent for your FinOps initiative.
1. CloudZero
CloudZero is built more like an observability tool than a conventional cost tool. This enables you to pull data from multiple sources, such as multiple clouds, infrastructure, applications, and Kubernetes. You can also track the costs of shared, untagged, and untaggable resources. All this ensures you have a complete picture of your cloud costs to make the right calls.
CloudZero automatically normalizes the data and breaks it down into metrics your finance and operations teams can understand and act on in a snap:
- For engineering: Cost per Deployment, Cost per Environment, Cost per Product Feature, Cost per Team, Cost per Service, etc.
- For finance: Cost per Customer, Cost per Project, Cost per Department, Cost per User per Day, Gross Margin, etc.
Consider this:
To make the most out of CloudZero and FinOps, you also get a Certified FinOps Practitioner. As a result, CloudZero customers find that it takes just three months for the platform to pay for itself, save them 22% in Year 1, and improve their efficiency by 33%. Don’t just take our word for it.
Trying CloudZero is risk-free. Schedule a free demo to put CloudZero to the test in your environment.
Year Founded: 2016
Category: Cloud cost intelligence
Best for companies that want to see the exact people, products, and processes that drive their spend – minimizing costs without sacrificing innovation, performance, and engineering velocity. Pricing model: Steady and predictable tiered pricing. Better yet, get a custom quote here.
2. ProsperOps
ProsperOps leverages AIOps, an always-working-in-the-background approach, and FinOps automation techniques to deliver results.
However, ProsperOps has a greater focus on optimizing AWS Reserved Instances and Savings Plans. It’ll be worthwhile if you want a FinOps tool that manages both RI and Savings Plans in one place and highlights unused cloud resources.
ProsperOps also charges you for the savings you make, unlike many tools that charge you a percentage of your cloud spend.
Year Founded: 2018
Category: Automated RI and savings management
Best for companies with AWS Reserved Instances and Savings Plans that need automated optimization.Pricing model: $0.05 per dollar saved (compute) and $0.35 per dollar saved on optimized/purchased RIs.
3. Harness
Harness’s Cloud Cost Management (CCM) seeks to help finance and IT teams track cloud spend proactively.
The Harness system monitors and reports unused instances each hour. FinOps teams can also create and enforce cost policies with it. Additionally, teams can use it across cloud providers including, Amazon Web Services, Google Cloud, and Microsoft’s Azure.
Additionally, Harness’ Continuous Delivery Platform offers root cost analysis to correlate cloud events with costs. However, some companies may find it pricey, depending on their cloud infrastructure demands.
Year Founded: 2016
Category: Automated cost management
Best for companies seeking more granular information on their cloud spending beyond AWS.
Pricing model: Tiers (limited freemium and paid plans) that charge by the percentage of cloud spend (2.25% of cloud spend for Teams, and 2.5% of cloud spend for Enterprise users)
4. Densify
For customers who want FinOps tools that support multiple cloud environments, including IBM Cloud and Google Cloud, Densify is worth considering. It is also compatible with container services such as Kubernetes and RedHat and hybrid environments on VMware.
Using machine learning, the tool identifies optimization opportunities, enables resource matching, accurately forecasts available resources, and prevents overprovisioning to reduce costs.
With Densify, finance and operation teams can intelligently create scaling groups and integrate FinOps workflows with DevOps pipelines to boost their efficiency.
Year Founded: 1999
Category: Hybrid cloud and container financial management
Best for companies that want to reduce overwhelm by checking their hybrid cloud spend in one place.
Pricing model: Request pricing
5. AWS Cost Explorer
Amazon Web Services introduced Cost Explorer in response to customer demand. AWS users previously complained that AWS bills were difficult to understand. Today, Cost Explorer is a popular starting point for cloud cost and usage analysis, rightsizing, cost anomaly alerting, and savings recommendations.
With Cost Explorer, you can generate customized cost and usage reports every month. Expect resource-level cost data (hourly, daily, or monthly) and historical data going back 12 months, great for comparing your costs over time.
Cost Explorer relies heavily on tagging. This means you need to pay extra attention to your tags to ensure accuracy. And yes, this can be tough, especially in multitenant, shared, and untagged resources.
Year Introduced: 2014
Category: AWS native cost tools
Best for companies with basic cloud costs and usage analysis.
Pricing: Free as an AWS user
6. CloudCheckr
With CloudCheckr, you get a cloud management platform with security and financial management functionality in one. You can track your resource usage trends and what’s driving the consumption to prevent waste.
CloudCheckr also helps you stay audit-ready by monitoring compliance across over 35 frameworks. Additionally, it continuously scans your environment to detect and report security vulnerabilities quickly.
CloudCheckr supports right-sizing resources, managing discount programs, and identifying idle resources. You can also share costs, security risks, and ongoing compliance reports with colleagues or your clients for further action.
Year Introduced: 2011
Category: Hybrid cloud cost optimization
Best for: Companies that want to manage cloud governance in one place, including performance, security, and costs.
Pricing: Custom quote
7. Apptio
Apptio provides a suite of tools you can add to your stack. It offers three tools to support FinOps implementation in an enterprise setting. Cloudability is its multi-cloud financial management platform. It offers insight into cloud resource consumption and related costs in the context of IT, finance, and DevOps teams.
Apptio One provides a more traditional approach by helping you measure your Total Cost of Ownwership (TCO). Yet it also focusses on enabling forecasting and streamlining planning cycles.
With TargetProcess, you can flexibly manage work, resources, and enterprise portfolios while maintaining continuous alignment with business objectives.
Year Introduced: 2007
Category: Enterprise cloud cost optimization
Best for: Companies that want to manage their multi-cloud environment in one place.
Pricing: Custom quote
8. Datadog
Datadog offers visibility across multi-cloud environments by tracking key metrics.
The platform integrates with over 700 other technologies, providing a comprehensive view of your infrastructure’s interdependencies.
Datadog breaks down cloud bills across cloud providers and helps optimize container costs by detailing costs by cluster, namespace, or pod. It fosters collaboration between FinOps and engineering teams through its integrated dashboards and Notebooks. These features eliminate wasteful spending and optimize both performance and cost.
Year Introduced: 2010
Category: Multi-cloud financial management
Best for: Companies using multiple cloud providersPricing: Custom quote
9. Kubecost
If you are looking into increasing cost visibility and accountability into just your Kubernetes environment, the Kubecost platform may help. Kubecost supports real-time cost visbility and notifications for quickly catching K8s infrastructure and cost issues before they become major problems.
Kubecost allocates K8s costs by various concepts, such as by namespace label, service, deployment, and more. You can also allocate the costs by business metrics such as team, product, and custom label.
In addition, you can view your costs across multiple clusters from a single dashboard. Alternatively, you can view them via an API endpoint. You can then combine Kubernetes costs with those for external cloud services and infrastructure to get a better sense of overall costs. It also lets you share external costs and then attribute them to any Kubernetes concept.
Year Introduced: 2019
Category: Kubernetes cost analysis and management
Best for: Companies that only want to manage Kubernetes spend.
Pricing: Custom quote
10. CloudHealth
VMware’s CloudHealth is an enterprise-level cloud financial management platform. In addition to cloud governance (optimizing system performance and managing security posture), FinOps teams can use it to manage costs.
This tool includes features such as rightsizing, discount program management, identifying idle and unused resources, as well as cloud budgeting and forecasting. CloudHealth also supports cost allocation (chargebacks and showbacks) and surfacing Kubernetes cost data.
There are multiple ways to break down costs in the platform, such as by project, team, or service. As with Cloudability, the product does not provide full per-unit cost visibility. This means you can see your totals and averages, rather than the hourly cost per customer or per feature intel that CloudZero presents.
Year Introduced: 2012
Category: Cloud governance and security management
Best for: Cloudability alternative.
Pricing: Custom quote
11. Xosphere
Xosphere offers a unique approach to cloud financial optimization. Rather than monitoring idle resources, it optimally switches your workload between expensive On-Demand and cheap Spot instances.
It does that by monitoring instances within AWS Auto-Scaling Groups natively. As soon as Spot instances become available at a reasonable price, Xosphere replaces On-Demand instances with the much cheaper AWS Spot instances.
As soon as Spot instance capacity becomes unavailable, it switches your workload back to the more durable On-Demand instances, ensuring application availability.
The Instance Orchestrator works in the background, automatically swapping Spot and On-Demand instances for you to maximize the benefits of Spot prices without downtime.
Year Introduced: 2020
Category: Spot instance orchestration
Best for: AWS customers that want to automate Spot instance management with minimal service outages.
Pricing: Per hour per Spot instance
12. Granulate
Intel’s Granulate promises continuous cost optimization across platforms such as AWS, GCP, and Azure. The tool uses an open-source profiler to detect bottlenecks in runtime performance at the code and app levels.
It further analyzes your CPU scheduling order, memory, network, oversubscribed locks, and disk usage patterns to surface optimization opportunities. Granulate maintains this continuous production profiling to ensure you can pinpoint areas of optimization at any time, scale, and environment.
Year Introduced: 2018
Category: Third-party FinOps tools
Best for small and large companies that want precise cloud cost and usage insights.
Pricing: Varied by use case; runtime, Kubernetes, or Big data.
13. Cloudability
Apptio’s Cloudability is a good choice for enterprises needing a more traditional cloud financial management platform. It doesn’t offer the same level of granular cost intelligence as CloudZero does, but you can track cloud costs by department, team, or project (total and average cost views).
You can also track your budget and predict spending. Cloudability also helps you identify potential cost savings opportunities, such as overprovisioning or unused resources. In addition, you can configure it to automatically implement these savings recommendations. In addition, you can configure it to automatically implement these savings recommendations in your environment, a handy time saver.
Better yet, Cloudability provides insights into the performance, compliance, and security of your cloud environment. This can help you stay on track with internal and industry standards at any scale.
Year Introduced: 2011
Category: Traditional FinOps tool
Best for companies looking for a more traditional cloud cost and usage analysis tool (total and average cost by project, department, etc).
Pricing: Custom quote
14. Spot
Spot delivers FinOps intelligence in three ways: visibility and analytics, infrastructure optimization, and cost optimization. It offers continuous cost visibility across multiple clouds, offering diverse insights such as profit analysis, total spend, and cost over time.
The cost optimization function provides detailed insights such as automated cost allocation by cost center, monthly commitments over time, and savings over time.
Under infrastructure optimization, you are free to use scheduling, bin packing, rightsizing, storage management, and more to increase utilization while minimizing waste.
Year Introduced: 2015
Category: Third-party FinOps tools
Best for large enterprises seeking a highly scalable cloud cost and usage analysis platform.
Pricing: Free trial, Custom quote
15. Yotascale
Yotascale aspires to provide end-to-end cloud cost visibility for all stakeholders, from finance to engineering to management. It monitors cost data across infrastructure, application, and containerized workloads to support this goal.
The platform automates budgeting (creation, tracking, and forecasting), cost allocation by various dimensions, and cost-saving recommendations. If you want to track your commitment utilizations (Reserved Instances and Savings Plans) you can do that too without needing additional installations.
Yotascale also provides standard FinOps features, such as identifying idle and unused resources, rightsizing, and automated alerts and notifications.
Year Introduced: 2015
Category: Third-party FinOps tools
Best for companies looking for more precise cloud cost and usage analysis.
Pricing: Free trial, fixed annual price
What Next? Get The FinOps Intelligence You Need
CloudZero automatically maps your costs to the people, products, and processes that drive it. This ensures you can tell exactly who, what, and why your cloud costs are changing. Take Cost per Customer, for example.
You can use the data to decide how to set fair pricing based on their usage, work out discounts for individual customers, and protect your margins on each contract.
Plus, CloudZero automatically assigns costs in the language of your stakeholders, such as Cost per Daily User for FinOps teams and Cost per Feature for engineers. It’s the type of cost intelligence you can put to use right away to optimize costs almost instantly.
Indeed, our Certified FinOps Practitioners are currently helping companies like New Relic, Remitly, and MalwareBytes understand and optimize their cloud costs. And we just helped Upstart save $20 million. Here’s your risk-free chance to make FinOps work for you. Grab your free demo here to experience CloudZero firsthand.
The Cloud Cost Playbook
The step-by-step guide to cost maturity
