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Introducing Business Metrics: A Smarter Way to Communicate the Business Value of Cloud

  • The Team at Apptio
  • April 22, 2020

An enhancement to the Business Mappings feature, Business Metrics allows FinOps professionals to add even more customization and granularity to cloud cost reporting. Don't just simplify how you look at a monthly cloud cost bill-- get the ability to link cloud cost directly to the business value it drives.

What are Business Metrics?

Business Metrics are new, custom metrics available within Cloudability that allow customers to augment existing billing data with customer-provided data. The result is that FinOps users can create precise, custom metrics related to cloud billing concepts using both business logic and cloud cost and utilization data.

Users can quickly operationalize these "synthetic" metrics throughout Cloudability's cost analytics reporting and dashboards. Business Metrics allow you to go beyond the native Cloudability metrics, empowering FinOps professionals to surface their cloud costs in the context of their own business.

Increase the power of cloud cost insights

Instead of solely reporting on monthly cloud costs, Business Metrics create strategic dialog around how your cloud investments impact your business.

  • Unit Economics: Contextualize cloud spend as a unit cost metric. This could be "cost per ride" for a rideshare business, "cost per active user" for SaaS, or "cost per subscription" for a content provider or gaming service, etc.
  • KPI-Driven Costs: Place cloud cost in the context of a business-specific KPI. For example, contextualize "cost" in terms of full-time engineers (cost in FTEs) to understand cloud spend in terms of the number of DevOps Engineers needed to support a deployed application.
  • Surcharge/Mark-up: Create a metric to track surcharge or markup for Cloud spend-- surface costs inclusive of management fees, license costs, or other surcharges using a single in-app metric. For example, creating an upcharge for storage backups across all Cloud vendors for the services managed on behalf of external and/or internal customers.

Business Metrics are part of a broader cost management story

Especially in the context of larger enterprise cloud spending, users have a growing responsibility to report on and answer questions specific to business health. Contextualizing cloud spending against business-specific KPIs to visualize trends will enable stakeholders to make decisions based on data that is meaningful to the business.

Unfortunately, this kind of cloud cost data ingestion and analysis doesn't "come stock" with native tools. Or tools might try to enforce a "one-size-fits-all" configuration to try to statically make sense of cloud spend. Here's where native tools and simpler cloud cost management tools can come up short:

Native tools treat cost categorization too simply, lacking the flexibility to assign costs to dynamic business structures granularly. While this might be fine for smaller organizations with strong tagging strategies, larger, complex orgs need the ability to allocate fully-burdened cloud costs with thousands of mapping rules.

  • Ideal solution: Use a cloud cost management platform, like Apptio Cloudability, to focus on mapping cloud spend against the specific business rules you need addressing, rather than being limited by simple mapping features.

Some tools try to create too rigid of a reporting or modeling structure (e.g., codifying cloud cost management) to deal with cloud cost complexity. This goes against the reality of every business or enterprise being different and requiring the flexibility to map cloud costs against multiple business structures (i.e., cost center vs. role vs. product line). Further, as these structures change, cost mappings need to be flexible enough to change with them.

  • Ideal solution: Find a cloud cost management platform that doesn't try to place a configuration on cloud cost, but instead abstract away complexity, leaving human-readable reporting that your business teams can make sense of.

Users with EDP (enterprise discount programs) that is more complex than a flat-rate discount can run into data processing lag, where complex discounts will be applied typically two weeks late. This then requires manual, error-prone corrections.

  • Ideal solution: use a cloud cost management platform that can integrate EDP data platform-wide and report against it in near real-time.

Do you have this level of cloud cost reporting granularity today?

Dealing with the growing complexity of cloud costs requires tools that ingest immense amounts of data and execute functions behind the scenes to abstract away that complexity for FinOps professionals and engineers. Don't just use a cost management tool that simplifies how you read a report.

Use a cloud cost management platform, like Apptio Cloudability, to gain increased accuracy, granularity, and flexibility in how you strategically report these costs back to the business.

Business Mappings and Business Metrics together help users leap past cloud cost visualization and reporting, and make more sense of complex cost structures while translating them to how your business measures success.

Get in touch with us today to try Business Metrics within your account.

If you aren't an Apptio Cloudability user yet, use our free trial to get a sense of what a leading cloud cost management platform can do for you.

Article Contents

Categories

  • IT Metrics & Benchmarking

Tags

  • Cloud Cost Management
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