In this chapter, we are going to talk about the FinOps Principles and FinOps Teams. Think of the FinOps Principles as a set of guidelines that need to be done as a whole. Doing one without the others won't work. The same is true for doing all but one. Think of the FinOps Principles as North Star goals to guide our activities as we practice FinOps.

The first FinOps Principle is "Teams need to collaborate". Collaboration is the trademark of FinOps, without it people make decisions based on partial data. Continuous improvement and fast decision-making are required to be successful and collaboration is the engine of the practice of FinOps.

The second principle is "The business value of cloud drives decisions". Use unit economics and value-based metrics to demonstrate business impact rather than aggregated cloud spend. Empower teams with data to make conscious trade-off decisions between cost, quality, and speed.

The third principle is "Everyone takes ownership for their cloud usage". Because the cloud decentralized purchasing decisions to the engineers, we need to hold the engineers accountable for their spend. Engineers have to use cost as a new efficiency metric when managing their cloud workloads against their budget.

The fourth principle is "FinOps reports should be accessible and timely". Engineers need near-real-time access to cloud cost data to drive better decisions around utilization. The FinOps team needs to ensure the data is consistent to build trust within the organization. Without trust, engineers won't use what you provide and are unable to make informed decisions.

The fifth principle is "A centralized team drives FinOps". Some activities work better centralized like getting executive support, reporting, automation, and governance, negotiating with cloud providers, and purchasing prepayment products. Some activities need to be decentralized like right-sizing, waste reduction, and forecasting. While a central team cannot perform all activities, it can drive them throughout the organization.

And the sixth principle is "Take advantage of the variable cost model of the cloud". Not having to pay for something when you turn it off is hugely powerful. FinOps needs to change the way we design applications in the cloud. Always look for new technologies that follow this principle and teach your engineers how to use them.

Let's switch gears and talk about FinOps Teams. The FinOps team coordinates efforts across all other groups, so three things are critical here: The FinOps team needs executive support, it has to be located in a part of the organization that allows it to reach out to all other teams, and it has to have strong soft skills to drive efforts, negotiate deliverables, and evangelize and train.

The FinOps team performs the following activities: Champion FinOps Principles, Propagate Best Practices, Coordinate FinOps across the organization, and Perform centralized FinOps functions on behalf of the company.

When looking at the structure of the FinOps team, it can be either a dedicated team that performs FinOps functions full time or it can be a mission-based team where team members have FinOps responsibilities in addition to other jobs. In either case, the FinOps team will need to align to other cloud and finance teams in the organization to be successful.

To summarize FinOps Principles and FinOps Teams: The six FinOps principles need to be viewed as North Star goals and executed as a whole. A centralized FinOps team drives FinOps activities throughout the organization through collaboration, negotiation, and training.