Ask any engineering team if they want to be more innovative and efficient; the answer would always be a yes. This pursuit of excellence has led to multiple paradigm shifts in recent years, like the fusion of development with operations, i.e., DevOps and its various siblings, DevSecOps, DevNetOps, DevTestOps, etc. On the same lines, a relatively new concept is emerging: DevFinOps. It is a blend of development, finance, and operations working together to boost productivity and cost-efficiency.
To bridge the gap between software development and financial strategy, DevFinOps emerged as a method that fosters collaboration, transparency, and agility. This newest movement helps businesses embrace a holistic approach to software development and management through collaboration.
This article explores DevFinOps—an approach where development, finance, and operations teams work together to enhance their engineering ecosystems. Whether you're an engineering leader or software developer, DevFinOps is the next big thing you should know about. It is expected to reshape the landscape of software engineering and financial strategy.
What Is DevFinOps?
DevFinOps is short for development, Finance, and Operations. At its core, it is a philosophy that empowers organizations to improve their software development lifecycle while maintaining fiscal responsibility.
While FinOps focuses on cloud spending and how organizations can bring them down. DevFinOps is as much about processes as it is about people. It considers factors like the cost of personnel in the engineering team, one of the biggest costs in a software-driven organization. It goes beyond measuring your cloud costs and emphasizes that people as a resource also contribute to high expenditure.
What Questions Can DevFinOps Answer?
There are certain questions that DevFinOps can help us answer. Knowing these answers can lead to efficient operations and reduced costs:
- Cost of building certain products or features: DevFinOps can provide real-time visibility into development expenses, helping teams manage and control costs effectively.
- Cost of maintaining legacy software: It can assess ongoing maintenance expenses and aid in optimizing legacy software management for cost efficiency.
- Capitalization of R&D (software) costs: This approach assists in accurately tracking and categorizing R&D expenses, ensuring proper capitalization and compliance with accounting standards.
- ROI of software initiatives: DevFinOps tools and practices can provide data to evaluate the return on investment for software projects, enabling informed decision-making.
- Budgeting for new projects based on experience: DevFinOps uses historical financial data to inform budgeting decisions, ensuring realistic budget allocation for new software projects.
Why Is DevFinOps More Important Than Ever?
The driving force behind this paradigm shift is the limited financial resources and rapid rise in IT expenditure. DevFinOps is not just a passing trend; it's a strategic method for organizations navigating the intersection of technology, finance, and operations.
Managing Costs: As IT spending escalates, DevFinOps emerges as a financial mogul, helping organizations control costs, navigate economic uncertainties, and ensure appropriate resource allocation. It provides engineering teams the tools and insights to simplify spending and reduce waste in an era marked by multiple tools and poor cloud ROI. DevFinOps helps make better financial decisions, transform IT costs into assets, and foster healthier balance sheets.
Strategic Vision and Data-Driven Efficiency: DevFinOps equips engineering teams with the tools and insights needed to manage spending on Software as a Service (SaaS), Infrastructure as a Service (IaaS), and Platform as a Service (PaaS). Plenty of organizations need help dealing with unpredictable cloud spending and the cost of multiple tools. DevFinOps empowers engineering teams to decrease resource wastage and unsustainable expenditures.
The Right Economics: Many engineering teams secretly want the superpower of frugality, and DevFinOps is their answer. Incorporating financial practice in your operations is a sure way of saving on IT expenditure.
Alignment and Recovery: Fusing financial strategy with DevOps enables teams to be aligned with business goals while continuously striving for improvement. For instance, new technologies have led to a surge in cybersecurity threats. This heightened risk environment requires constant monitoring and security updates. DevFinOps comes to the rescue by actively identifying vulnerabilities and enhancing security measures through regular assessments. DevFinOps recovers these lost costs through regular assessments. DevFinOps can transform software costs into valuable assets, making financial records look good and balanced.
DevOps has been shown to reduce time to market, allowing businesses to deploy on-demand, recover faster, and have a change failure rate of less than 5%. While DevOps and FinOps may seem different on the surface, they share many business-friendly attributes, including reduced time to market. These quantifiable benefits of the intersection of finance and DevOps are compelling more and more organizations to adopt DevFinOps.
By incorporating FinOps principles into their DevOps processes, businesses can run workloads more efficiently, achieving improved performance and often reducing expenses.
DevFinOps represents a crucial evolution in the realm of software engineering and financial strategy. As organizations strive for innovation and efficiency, the synergy between development, finance, and operations has become paramount. DevFinOps not only addresses the challenges of controlling costs in an era of rising IT expenditure but also promotes collaboration, transparency, and agility.
This holistic approach acknowledges that software development is not just about code and infrastructure but also about the people who drive it. By incorporating financial principles into DevOps processes, DevFinOps empowers engineering teams to make informed decisions, optimize expenses, and transform IT costs into valuable assets.