The Azure FinOps Guide
Published Jan 08 2023 11:44 PM 10.9K Views
Microsoft

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This article centralizes Azure FinOps (Financial Operations) information and tools to enabling a better understanding and optimization of cloud costs.

 

The main purposes of this guide is to help customers do more with less by:

  • Identifying cost-saving opportunities
  • Optimizing cloud efficiency
  • Gaining a better understanding and control of cloud costs

 

Contribution to this guide 

The community is encouraged to contribute to this guide!
For any content suggestion please visit this GitHub Repository.

 

Table Of Contents

  • What is FinOps?
  • Overview
  • Tools
  • Ways to Optimize
  • Assessment
  • Learning
  • Content
    • General
    • Calculators
    • Cost Management
    • Advisor
    • Azure Reservations
    • Savings Plans
    • Azure Hybrid Benefit
    • Virtual Machines
    • App Service
    • AKS
    • Azure Stack HCI
    • Storage
    • Azure Monitor
    • Azure Sentinel
    • Azure Virtual Desktop (AVD)
    • Data
      • Azure Synapse
      • Azure SQL Database
      • SQL Managed Instance
      • Azure Database for MySQL
      • Azure Database for PostgeSQL
      • Azure Cosmos DB
      • Stream Analytics

 

 

 

 

What is FinOps?

FinOps (Financial Operations) is a discipline that focuses on optimizing and managing the financial aspects of cloud computing.

This includes activities such as:

  • Analyzing and reducing cloud expense
  • Maximizing cost-efficiency
  • Improving the overall return on investment (ROI) of cloud services

FinOps professionals use a variety of tools and techniques to achieve these goals, including:

 

  • Cost optimization strategies
  • Cost allocation and reporting tools
  • Real-time monitoring and alerting systems

They also work closely with other teams, such as engineering and operations, to ensure that cloud resources are used effectively and efficiently.

 

FinOps aims to help organizations get the most value out of their cloud investments by optimizing their cloud expenditure and maximizing the efficiency of their cloud usage. This can help organizations to reduce costs, improve the performance of their applications and services, and increase their overall competitiveness.

 

 

 

 

Overview

 

What was the motivation for creating the guide?

As a cloud engineer, I work with different types of customers, including enterprises, startups, ISVs (independent software vendors), and digital native companies. In today's economic climate, cost, efficiency, and optimization are the top priorities of all customers.

 

Optimizing and reducing cloud costs can be challenging due to the dispersed nature of relevant information.

To address this issue, I have written this 'Azure FinOps Guide', a comprehensive resource that combines all Azure FinOps information to make customers' life easier.

 

Who is the audience for this guide?

The audience for this guide includes organizations that use Azure cloud services and are interested in optimizing, monitoring, and reducing their cloud costs. This may include:

  • Financial decision-makers within businesses of all sizes
  • Cloud engineers
  • IT professionals
  • ISVs (independent software vendors) that provide cloud-related services to their clients and want to optimize their cost-efficiency

 

How to use this guide?

Use the table of contents below to locate a specific tool, topic, or services you are interested in, such as cost optimization techniques or strategies for improving cloud efficiency.

 

Examples

  • Want to see ways to optimize your cloud expense:
    • Navigate to the "How to Optimize?" section.
    • Choose a specific topic from the list to learn more.
  • If you are interested in optimizing and saving on your storage costs:
    • Navigate to the "Content" section.
    • Select the "Storage" sub-section to find relevant topics.
    • Choose a specific topic from the list to learn more.

 

 

 

 

Tools

The table below contains a collection of native tools that are related to FinOps on Azure:

Tool Name Description
Azure Pricing Calculator Allows you to mix and match different combinations of Azure services to see an estimate of the costs.
Azure Cost Management A suite of tools that help organizations to monitor, allocate, and optimize the cost of their Microsoft Cloud workloads.
Azure Advisor Analyses configurations and usage telemetry and offers personalized, actionable recommendations to help optimize resources for reliability, security, operational excellence, performance, and cost.
TCO Calculator

TCO = Total Cost of Ownership

Estimate the cost savings you can realize by migrating your workloads to Azure.
Azure Hybrid Benefit Savings Calculator

Estimates the price, savings, and eligible instances you can use in Azure based on your current Software Assurance licenses. (Windows VMs, SQL Server VMs, SQL Managed Instance, and SQL Database)

 

 

 

 

Ways to Optimize

This table contains a list of techniques to optimize and reduce your cloud environment's total cost of ownership.

Topic Description
Cut out waste A Workbook to identify resources that are no longer being used.
Azure Advisor Analyses configurations and usage telemetry and offers personalized, actionable recommendations to help optimize resources for reliability, security, operational excellence, performance, and cost.
Spot VMs Buy unused compute capacity at significant cost savings.
Saving Plans Committing an hourly spend for Azure compute resources for a one-year or three-year plan.
Azure Reservations Help you save money by committing to one-year or three-year plans for multiple products.
Azure Hybrid Benefit Reduce the costs of running your workloads in the cloud using your on-premises Software Assurance-enabled Windows Server and SQL Server licenses on Azure. (Licensing benefit)
On-Demand Capacity Reservation Enables you to reserve Compute capacity in an Azure region or an Availability Zone for any duration of time without any commitment.
Azure Reserved Capacity Save on Azure database services by pre-committing to fully-managed services.
Software Plans Reservation discount for deployed VMs with SUSE and RedHat software.
Dev/Test pricing Significantly reduce the costs of ongoing dev/test workloads with discounted rates on Azure services.

 

 

 

 

Assessment

You can run a free self-cost management assessment on your environment to examine your efficiency.

For more information, see Azure Well-Architected Review | Assessments

 

 

 

 

Learning

Here is a list of learning path references related to FinOps on Azure:

Learning Path

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Control Azure spending and manage bills with Microsoft Cost Management + Billing

Learn how to monitor and control your Azure spending and optimize the use of Azure resources.

 

Learning Path Modules:

 

Module Name

Description

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Microsoft Azure Well-Architected Framework – Cost Optimization

Learn how to use the cost optimization pillar of the Microsoft Azure Well-Architected Framework to design a cloud-based architecture that is efficient, eliminates waste, and gives you full visibility into where your money is spent on cloud resources.

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Plan and manage your Azure costs

Learn about the factors that influence cost and tools you can use to help estimate and manage your cloud spending.

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Introduction to analyzing costs and creating budgets with Microsoft Cost Management

Learn how to use cost analysis to understand how your costs accrue each month. Use this understanding to create an Azure budget to monitor and alert you on your costs.

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Save money with Azure Reserved Instances

Save money by taking advantage of Azure reservations. Analyze and decide what to purchase and then learn how to purchase. Understand the benefits provided through compute purchases and optimize against any underuse. Perform basic reporting on your reservations.

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Optimize Azure costs with data analysis in PowerBI

Use Power BI to understand where your money is being spent in Azure so you can help your organization to optimize its costs. Identify key cost drivers, trends, and anomalies in your subscriptions and resource groups over time. Understand and manage hybrid benefits usage within your organization. Understand and optimize your reserved instance coverage to maximize your savings. Create custom dashboards to address your organization's more complex scenarios and analysis needs.

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Configure and manage costs as a Microsoft partner by using Microsoft Cost Management

Reconcile your bill and analyze costs across your customers and resources using Microsoft Cost Management as a partner. Determine which of your resources receive discounted pricing. Manage costs through budgets to stay within defined spending limits. Enable your customers to use Microsoft Cost Management with pay-as-you-go rates.

 

 

 

 

Content

This content summary brings together a wealth of information and resources on the discipline of FinOps in the cloud.

It covers a wide range of topics, domains, products, and resources collected from different channels like:

  • Microsoft Tech Community (Blog Posts)
  • Microsoft Azure (Official Docs)
  • Microsoft Learn
  • Microsoft Ignite
  • Azure Friday
  • YouTube
  • GitHub

Whether you are new to FinOps or are an experienced professional, this summary is an invaluable resource for staying up-to-date with the latest developments and trends in the field.

 

General

Topic Author Published Channel
Managing, reporting, and reducing your costs in Azure

Scott Hanselman

Barry Luijbregts

Dec 2022 Azure Friday
Azure Cost Optimization Deep Dive John Savill May 2022 YouTube
Factors That Affect Costs John Savill Jan 2022 YouTube
Factors to Reduce Cost John Savill Jan 2022  YouTube
Azure Orphaned Resources Dolev Shor Jun 2022 Microsoft Tech Community
Azure Orphaned Resources Workbook Dolev Shor Jun 2022 GitHub
Azure FinOps Workbook Sam Bell Jan 2023 GitHub
Azure Optimization Engine Hélder Pinto Feb 2021 GitHub

 

 

Calculators

Topic Author Published Channel
Master the Azure Pricing Calculator John Savill Jun 2021 YouTube
Functionality and Usage of Pricing and TCO Calculators John Savill Jan 2022 YouTube

 

 

Cost Management

Topic Author Published Channel
Describe cost management in Azure Microsoft   Microsoft Learn
Azure Cost Management Overview Michael Flanakin Aug 2022 Microsoft Tech Community
Azure Cost Management for ISVs Halaa Menasy Mar 2022 Microsoft Tech Community
Azure Unblogged – Azure Cost Management Sarah Lean Mar 2021 Microsoft Tech Community
Functionality and Usage of Azure Cost Management John Savill Jan 2022 YouTube
Create visuals and reports with the Azure Cost Management connector in Power BI Desktop Microsoft Aug 2022 Microsoft Learn | Docs

 

 

Advisor

Topic Author Published Channel
Intro to Azure Advisor Microsoft   Microsoft Learn
Get Started with Azure Advisor Microsoft   Microsoft Learn
Functionality and Usage of Azure Advisor John Savill Jan 2022 YouTube

Optimize your Azure environment with Azure Advisor

Thomas Maurer Apr 2021 YouTube

 

 

Azure Reservations

Topic Author Published Channel
Azure Reservations (Reserved Instances) Deep Dive John Savill Dec 2021 YouTube
Reserved Instance and Capacity Reservations John Savill May 2022 YouTube
Understanding Azure Reservations vs Savings Plans Brandon Wilson Dec 2022 Microsoft Tech Community

 

List of services that supported reservations:

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Savings Plans

Topic Author Published Channel
Purchase Azure savings plan for compute Microsoft   Microsoft Learn
Understanding Azure Savings Plan for Compute  John Savill Oct 2022 YouTube
Understanding Azure Reservations vs Savings Plans Brandon Wilson Dec 2022 Microsoft Tech Community

 

 

Azure Hybrid Benefit

Topic Author Published Channel
Azure Hybrid Benefit for Windows Server Microsoft Nov 2022 Microsoft Azure
Azure Hybrid Benefit for Linux Server Microsoft Aug 2022 Microsoft Azure
Azure Hybrid Benefit for SQL Virtual Machines Microsoft Aug 2022 Microsoft Azure
Azure Hybrid Benefit for Azure SQL & Azure SQL Managed Instance Microsoft Aug 2022 Microsoft Azure
Azure Hybrid Benefit for Azure Kubernetes Service (AKS) Microsoft Jul 2022

Microsoft Learn | Docs

Azure Hybrid Benefit for Azure Stack HCI Microsoft Jul 2022 Microsoft Azure

 

 

Virtual Machines

Topic Author Published Channel
Microsoft Azure Spot Virtual Machines overview Rajeesh Ramachandran Mar 2021 YouTube
Azure Spot VM Deep Dive John Savill Nov 2021 YouTube
Understanding Windows Server IaaS Virtual Machine cost management Microsoft   Microsoft Learn
Start/Stop VMs Microsoft Nov 2022 Microsoft Learn | Docs
Part 2: Infra Cost Optimisation In The Cloud – Practical Design Steps For Architects and Developers Shane Baldacchino Aug 2022 Microsoft Tech Community

 

** Azure Reservations for Virtual Machines.

** Azure Savings Plans for Virtual Machines.

** Azure Hybrid Benefit for Virtual Machines (Windows VM, Linux VM, SQL VM)

 

 

App Service

Topic Author Published Channel
Azure App Service announces more ways to save on compute costs Mayunk Jain Nov 2022 Microsoft Tech Community
A lowered cost and more performant WordPress on Azure AppService Radhika Bollineni Oct 2022 Microsoft Tech Community

 

 

AKS

Topic Author Published Channel
Optimize compute costs on Azure Kubernetes Service (AKS) Microsoft   Microsoft Learn | Training
How to reduce the total cost of ownership (TCO) of your Azure Kubernetes Service (AKS) cluster Paolo Salvatori Jan 2023 Microsoft Tech Community
Azure Kubernetes Service (AKS) – Cost Optimization Techniques Chee Keong Tan Oct 2022 Microsoft Tech Community
AKS Container Insights logging level and associated costs Orestis Meikopoulos Nov 2022 Microsoft Tech Community
Azure Hybrid Benefit for Azure Kubernetes Service (AKS) Microsoft Jul 2022

Microsoft Learn | Docs

 

 

Azure Stack HCI

Topic Author Published Channel
Azure Hybrid Benefit for Azure Stack HCI Microsoft Jul 2022 Microsoft Azure

 

 

Storage

Topic Author Published Channel
Optimizing your storage costs with Azure Blob Storage

Scott Hanselman

Klaas Langhout

Apr 2021 Azure Friday
Optimize your cost with Azure Blob Storage Microsoft   Microsoft Learn
Optimize performance and costs by using Azure Disk Storage Microsoft   Microsoft Learn
Optimize storage performance and costs using Blog storage tiers Microsoft   Microsoft Learn
Plan and manage costs for Azure Blob Storage Microsoft Dec 2022 Microsoft Azure
Optimize costs by automatically managing the data lifecycle Microsoft Dec 2022 Microsoft Azure
Optimize costs for Blob storage with reserved capacity Microsoft Jul 2022 Microsoft Azure
Estimate the cost of archiving data Microsoft Dec 2022 Microsoft Azure
Part 2: Infra Cost Optimisation In The Cloud – Practical Design Steps For Architects and Developers Shane Baldacchino Aug 2022 Microsoft Tech Community

 

 

Azure Monitor

Topic Author Published Channel
Cost optimization and Azure Monitor Microsoft Dec 2022 Microsoft Azure
Set a table's log data plan to Basic or Analytics Microsoft Jan 2023 Microsoft Azure
Calculating Chargeback to Split Monitoring Costs Across Projects Bruno Gabrielli Nov 2022 Microsoft Tech Community

 

Azure Sentinel

Topic Author Published Channel
Ingestion Cost Spike Detection Playbook Innocent Wafula Aug 2021 Microsoft Tech Community
Ingestion Cost Alert Playbook Innocent Wafula Dec 2022 Microsoft Tech Community
Cost Management in Azure Sentinel

Javier Soriano

Jeremy Tan

Innocent Wafula

Jun 2021 YouTube

 

 

Azure Virtual Desktop (AVD)

Topic Author Published Channel
Optimize Azure Virtual Desktop Microsoft   Microsoft Learn
New ways to optimize flexibility, improve security, and reduce costs with Azure Virtual Desktop Kam VedBrat Oct 2022 Microsoft Tech Community

New ways to optimize flexibility, improve security, and reduce costs with Azure Virtual Desktop

Kam VedBrat

Kate Werner

Oct 2022 Microsoft Ignite

 

 

Data

 

Azure Synapse

Topic Author Published Channel
Synapse Serverless SQL Pool - Performance and cost optimization with partitioning Luca Ferrari Nov 2022 Microsoft Tech Community
Cost management for serverless SQL pool in Azure Synapse Analytics Microsoft Apr 2022 Microsoft Learn | Docs
Configure cost control for serverless SQL pool in Synapse Studio Microsoft Apr 2022 Microsoft Learn | Docs

 

 

Azure SQL Database

Topic Author Published Channel
Plan and manage costs for Azure SQL Database Microsoft Sep 2022 Microsoft Learn | Docs
Azure SQL Database and cost optimization Microsoft Jun 2022 Microsoft Learn | Docs

 

** Azure Hybrid Benefit for Azure SQL Database.

 

 

SQL Managed Instance

Topic Author Published Channel
Optimize cost of SQL Managed Instances with new stop-start capability Uros Milanovic Nov 2022 Microsoft Tech Community
Optimize your Azure SQL Managed Instance cost with Microsoft Azure Well-Architected Framework Bartłomiej Graczyk Mar 2021 Microsoft Tech Community

 

** Azure Hybrid Benefit for SQL Managed Instance.

 

 

Azure Database for MySQL

Topic Author Published Channel
Azure Database for MySQL and cost optimization Microsoft Dec 2022

Microsoft Learn | Docs

How to auto-scale an Azure Database for MySQL/PostgreSQL instance with Azure run books and Python Julio Calderón Mar 2019 Microsoft Tech Community

 

 

Azure Database for PostgreSQL

Topic Author Published Channel
Azure Database for PostgreSQL and cost optimization Microsoft Dec 2022

Microsoft Learn | Docs

How to auto-scale an Azure Database for MySQL/PostgreSQL instance with Azure run books and Python Julio Calderón Mar 2019 Microsoft Tech Community

 

 

Azure Cosmos DB

Topic Author Published Channel
Plan and manage costs for Azure Cosmos DB Microsoft Oct 2022

Microsoft Learn | Docs

 

 

Stream Analytics

Topic Author Published Channel
Optimize your Stream Analytics Job and Reduce Costs with Autoscale Anasheh Boisvert May 2022 Microsoft Tech Community

 

I would appreciate it if you could tell me what you think of this Azure FinOps Guide.

Your thoughts and suggestions will help me improve it, so please don't hesitate to leave your feedback below.

 

 

 

 

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‎Jan 23 2023 04:51 AM
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