Jay Litkey, SVP Cloud & FinOps, Flexera and Niladri Ray, Country Head, India and VP-Engineering, Flexera in an recent interaction with CIOTech Outlook shared their invaluable insights into how organizations can maximize their cloud ROI through effective cost management, intelligent automation, and governance practices and more.

Jay Litkey is a seasoned entrepreneur and technology executive with over 25 years of experience in enterprise software, SaaS, cloud computing, and FinOps. As SVP, Cloud & FinOps at Flexera, he leads the company’s strategy and execution across FinOps, AI-driven automation, and ecosystem growth.

Niladri Ray is the Country Head, India and VP-Engineering for Flexera, with his current responsibilities covering Data Intelligence, FinOps, Security Vulnerability Management and AI/ ML in Global Hybrid IT contexts.

How do multi-cloud environments introduce complexity in cloud cost management? How can FinOps frameworks address these challenges effectively?

When you think about multi-cloud, every cloud performs tasks differently. They have different financial instruments, which mean they have different ways to save money, products/solutions that you can sign up to. If you are used to dealing with one cloud, like Amazon, AWS, and you start using Microsoft Azure, the words are different, the tasks you can perform in that cloud are different. They are similar, but they are called with different names. Thus, there is complexity since they are not similar in that way.

How they generate their bills is different. So some people specialize in one cloud, but if you're trying to be a specialist across all of them, there's complexity. So what FinOps says and does is let's standardize some of the language we use.

Let us even standardize the formats of the bills. So that Amazon and Microsoft produce a bill looking the same way, and FinOps is helping to drive some of that standardization and some of those processes to make it easier to manage the multi-cloud environment.

What are some key strategies for driving cost-functional collaboration between finance, operations, and IT teams for optimising cloud cost? As organisations scale, how does the role of FinOps evolve in terms of managing cloud economics and ensuring cost efficiency across diverse teams?

FinOps has helped organizations in recognizing that they need to create a central team. The team might comprise individuals performing the tasks full-time, and also individuals performing tasks part-time as well. But what FinOps realized and believes is you need a cross-functional team. A finance professional does not understand enough about the technology to make all the decisions. An engineer does not understand much about the financial instruments to make all of the decisions and you can go down the list of you need to get representation of different stakeholders sitting around the table to make smart decisions. Therefore, one of the fundamentals of FinOps is a cross-functional team that collaborates and looks at shared data.

Thus, without FinOps, the finance team has its own data, the engineering team has its own data, the DevOps team has its own data, the application owner has his own data. No one is looking at the same data, hence, the chance of them coming to the same decision is less. This is where FinOps comes into the picture and helps employees from diverse teams to make decisions at the same table. FinOps emphasizes collaboration and transparency by ensuring that all stakeholders examine the same data. By bringing their respective expertise to the discussion, they can make more informed decisions about managing the environment. This approach fosters smarter, data-driven decision-making, reinforcing why FinOps has been so effective.

FinOps has numerous concepts of personas and allied personas and it talks about how these various interconnected pieces come together. For instance, procurement would typically play a lead role in terms of the contracts that you would sign with the supplier, which could go over several years and the verbiage then becomes very important in terms of what are the rights for use.

For enterprises operating in a hybrid environment, the management of licenses across on-premises and cloud platforms becomes crucial. Events such as employee onboarding or departure trigger licensable actions, making transparency essential. Accurately attributing workloads and their associated costs plays a significant role in providing a unified view, which is instrumental in driving well-informed, cohesive decisions for the company.

In what ways have MSPs evolved from traditional IT outsourcing to becoming strategic partners in cloud cost optimisation?

When you think about how MSPs originated, they managed infrastructure. They might help with the great fix, they help manage the day-to-day operations. MSPs have evolved now with the expertise to manage these cloud environments at scale.

Hence, it's large environments in a multi-cloud environment. They help solve not just the technology problem of managing the costs and the usage in clouds, but they also help solve the people and the process challenges. A common lesson in technology is that the problem is rarely just about technology itself.

It's the people and the process that needs to be solved as well to really obtain the business value from technology. Thus, firstly, MSPs have evolved, to solve the technology problem, but to have the experience at scale, the patterns - they work with thousands of customers to bring that people and process to it. MSPs as well also apply the right tools for the work.

Also, they work with thousands of customers. They have come to learn which tools are the right ones for the job; they bring the right tools to the problem as well. As a result, MSPs have evolved from being purely reactive or solely managing infrastructure to actively assisting companies—sometimes at the board level—in addressing the growing challenges of cloud usage and spending.

It is remarkable to reflect on a time before the cloud. Initially met with skepticism, many doubted its usefulness and widespread adoption. However, cloud computing has grown exponentially, and in the coming years, annual cloud spending is set to surpass a trillion dollars—a testament to its transformative impact.

 At that size of cloud spending, it's now a boardroom concern, the board of directors of a company pays attention when that company is spending tens of millions or hundreds of millions of dollars in the cloud every year. Hence, again, the MSP has shifted from being reactive, focused on infrastructure, to proactive, doing FinOps, and focussing on problems and business value that matters to senior leadership and even boards of directors.

How will MSPs play a role in implementing FinOps practices, and what benefits do organisations see from this collaboration?

MSPs have taken a variety of approaches in supporting FinOps. Some are helping enterprises review the cloud charging and cloud environment management, and offer projects to assess maturity and efficiency. Some are offering FinOps as a managed service, which enables the business to outsource these capabilities, and sets up a proper process instead of building an in-house team.

In some cases, the MSPs are enhancing an existing FinOps team by improving processes and insights. The term Cloud FinOps is how we described our initial thinking about managing cloud costs, the costs charged by cloud providers (Amazon, Azure, Google, etc.), but the definition has expanded beyond cloud infrastructure to SaaS spending, private cloud spending, and data center spending as FinOps.

FinOps also has expanded to sustainability management and AI related spending since we have assembled all of the spending in to a single framework. There are plenty of opportunities for MSPs in this evolution of FinOps. Depending on their team structure and engagement model, some will align with businesses in a project based configuration, while others offer full FinOps as a service.

In other situations, MSPs will collaborate and work along side the internal teams while building competencies. The best option is determined by the needs of the specific business customers. In any case, MSP's can be a reliable partner while maximizing cloud and IT functional financial management.