The evolution of FinOps, encompassing cloud cost management and optimization, has been ongoing for over a decade. Initially addressing the complexities of cloud infrastructure like compute, network, and storage, FinOps matured alongside the expanding offerings of cloud providers. The term “FinOps” emerged to define the discipline dedicated to efficient cloud spend management. Organizations, adept at handling the basics, are now faced with a new challenge — the surge in cloud spend due to the migration of workloads, including commercial software with associated licenses and costs. While FinOps traditionally focused on infrastructure optimization, considerations around licensing, software asset management (SAM), and compliance are becoming increasingly crucial.

As organizations move towards cloud-native practices, the complexities of commercial software licensing in the cloud emerge. The need for SAM expertise becomes evident, as SAM practitioners are well-versed in navigating the intricate landscape of software licenses, end-of-support considerations, and overall software lifecycle management. SaaS adoption adds another layer to cloud costs, necessitating a comprehensive view of these expenditures as part of the organization’s IT management costs. Without factoring in licensing considerations, the true total cost of applications running in the cloud remains obscured. Infrastructure adjustments may impact licensing costs, and software configuration can significantly influence overall application costs.

To address these additional cloud cost factors, a broader FinOps perspective is essential. The emergence of Hybrid ITAM and FinOps combines the core elements of FinOps with SAM considerations, offering a comprehensive view of all costs associated with cloud usage. Tooling that integrates cloud cost optimization, IT Asset Management, and SaaS Management allows organizations to extend their FinOps practices. Collaboration between ITAM and FinOps teams becomes crucial to gain visibility into all costs related to running applications in the cloud, beyond the infrastructure itself. The Hybrid ITAM and FinOps approach enables organizations to optimize costs holistically, achieving true Technology Value Optimization (TVO) across all IT resources and environments.