Tencent Cloud FinOps Cost Management Solution
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Tencent Cloud FinOps Solution Overview
With the popularity of FinOps principles and businesses increasingly focusing on cloud costs, Tencent Cloud assists customers in conducting FinOps work by building a range of platform capabilities.
FinOps principles mainly involve business and project teams following six core principles. Through collaboration among management, business, finance, and project personnel, they employ visual management, usage optimization, and continuous operational improvements. This gradually advances FinOps maturity from "crawling" to "walking" and eventually "running," ultimately achieving optimal cloud business value. The FinOps framework also covers multi-cloud scenarios and introduces the FOCUS specification, defining a uniform bill data format to facilitate FinOps practices across multi-cloud environments.
Tencent Cloud, based on the above FinOps principles and combined with its own features, has established a cost management system within the site to assist customers in better deconstructing costs, analyzing costs, managing costs, and optimizing costs, creating a looped operational mechanism to maximize business value.
Provide bill data on the database with multiple dimensions including consumption, amortization, tag, and group organization to support customers in flexibly deconstructing costs.
On the analysis layer, offer multidimensional BI analysis, custom cost reports, AI cost analysis, and intelligent prediction tools to assist customers in quickly understanding costs.
At the management layer, provide proactive and automated control methods executed in multiple ways to meet diverse cost management requirements.
At the optimization layer, guide customers to adjust resources, intelligently output purchase suggestions, and achieve final cost optimization objectives.
For multi-cloud FinOps management scenarios, Tencent Cloud also has solutions compatible with third-party service providers. Customers can achieve self-service integration with third-party services through tools provided by Tencent Cloud, such as TencentCloud API and FOCUS bill.
Tencent Cloud FinOps Implementation Framework
FinOps management is a systematic project covering the full lifecycle of enterprise cloud adoption, requiring continuous operation and advancement. Its principles are not static. Tencent Cloud, based on its practical experience, continuously iterates its cloud cost management system to provide cloud users with abundant and efficient cost management tools.
Based on the core FinOps philosophy, the cloud cost management process is divided into cost planning, cost analysis, and cost optimization as the three core stages. These form a closed-loop operation, helping users achieve a spiral rise in cloud cost management and ultimately attain the goal of maximizing business value.
Cost planning stage: Cloud users need to conduct systematic front-end planning from three key dimensions: organization, budget, and resources. At the organizational level, clarify the project architecture, set up the account and tag system based on management objectives, and delimit cost settlement relationships. At the budget level, complete budget formulation and allocation rule development, and select appropriate billing modes based on business scenarios. At the resource level, reasonably select resource specifications and complete technical scheme planning to lay a solid foundation for subsequent efficient Tencent Cloud resource management and cost optimization.
Cost analysis stage: Cloud users can accurately grasp cost consumption trends in real time through cost visualization tools, dynamically track and adjust resource usage strategies with the aid of budget vs. actual expenditure comparison and analysis. After billing settlement, conduct in-depth deconstruction using tools such as cost allocation, special project reports, and AI-based intelligent analysis to precisely locate cost control issues and optimization space, providing data support for subsequent optimization actions.
Cost optimization stage: Focused on execution, cloud users take measures such as releasing idle resources and configuring elastic scaling mechanisms based on optimization suggestions from resource monitoring tools, combined with business characteristics, performance requirements, and cost objectives to enhance resource utilization efficiency. Meanwhile, referring to usage and cost data from the cost analysis stage, they leverage platform-specific calculation tools to switch billing modes optimally, further reducing costs by purchasing saving plans, resource packages, and other rights assets to save space.
FinOps practice is essentially a cross-functional collaboration model for cloud cost management. It involves forming a dedicated team with cross-functional members from management, business, finance, and operations. Guided by established management principles, the team comprehensively applies suitable tools and methods to collaboratively advance and eventually achieve efficient cloud cost control.
Tencent Cloud FinOps Full Cycle Cost Management
1. Multiple Billing Modes: Multi-Perspective Cost Data Provided By
On the basis of providing customers with accurate and timely cost bills, the billing side builds a multi-caliber billing system to meet diverse data needs from different perspectives. This includes expense bills reflecting actual transactions, consumption bills based on accrual basis accounting, and cost allocation bills tailored to internal organization management.
1.1 Billing Statement: Foundation Bill Reflecting Customer Actual Payment and Tencent Cloud's Transaction History
In expense bills, customers can learn about the cost structure of monthly bills, monthly cost trend charts, and an overview of various dimensional bill costs through the overview view.
Multidimensional comprehensive view supported dimensions: by product, by project, by billing mode, by region, by tag summarization.
1.2 Consumption Bill: Statement Reflecting Actual Resource Usage after Reasonable Amortization of Prepaid Fees, Compliant with Accrual Basis Accounting for Internal Financial Analysis and Posting
Tencent Cloud Products offer various billing forms, such as pay-as-you-go and annual/monthly subscription. To help customers track their cost of migrating to cloud, a bill caliber is required to reasonably amortize prepayment, avoiding cost fluctuations caused by large prepayments that may interfere with customer analysis and judgment. Therefore, Tencent Cloud billing launches consumption bills to serve cloud customers.
In consumption bills, prepaid expenses including annual/monthly subscription, package purchase, and reserved instance will be allocated based on accounting standards, finally displaying a smoother bill that reflects the customer's actual consumption.
1.3 Cost Allocation Bill: Statement for Expense Collection and Allocation to Corresponding Teams Based on Internal Organizational Structure, Used for Business and Financial Analysis and Operation Management
Cost allocation bill contains fee details of ALL allocation units, clearly displaying cloud resource usage and expense proportion for each department or project. Through cost allocation bills, enterprises can more accurately learn about cloud resource usage of each department or project, thereby achieving improved budget and cost control. You can choose the billing period, statistical dimension, and statistical cycle of cost allocation bills as needed, and view them.
The cost allocation bill provides settlement results across four key dimensions: overview, product, resource, and component. The statistical cycle supports monthly and daily dimensions.
Support viewing collected fees, allocated fees, and total cost separately.
Support viewing expense proportion, month-over-month comparison, and cost trend.
1.4 FOCUS Invoice Format: Uniform International Invoice Format Providing Strong Support for Customer Cloud Environment Management
Tencent Cloud supports storing your FOCUS bill in a COS bucket. FOCUS™, short for FinOps Open Cost and Usage Specification, is a technical specification that defines a standardized format to unify cost and usage data across cloud vendors. This specification aims to simplify billing data management across cloud providers, effectively reducing the complexity and workload of handling billing data from different cloud vendors, promoting data-driven decision-making and maximizing the business value of cloud.
2. Cost Allocation Tool: Help Customers Collect and Allocate Cloud Resources by Organizational Unit
Cloud resources represent a significant cost. While users can query and analyze cloud resource costs based on standard dimensions such as cloud products and resources, they also expect to manage cloud costs according to business (or individual) cost budget management dimensions, such as by department or project. To meet this demand, Tencent Cloud provides a complete cost allocation management solution and product capabilities tailored to such scenario requirements. This enables automatic cloud resource fee collection and allocation based on the user's own cost allocation structure, ultimately achieving lean analysis and control of cloud resource costs.
Currently, Tencent Cloud offers two cost allocation tools: allocation tags and cost allocation units. These help you customize management and statistical analysis dimensions, so as to better meet your various requirements for statements and cost analysis.
2.1 Allocation Tag
Tags are a collection of resources classified and managed by users based on their own requirements. Tags used for cost allocation and cost analysis are called allocation tags, which can be flagged and managed on the Cost Allocation Tags page. Allocation Tags are a simplified cost allocation tool with relatively simple functionality, suitable for scenarios requiring cost allocation based on a single dimension.
For example, a company may want to analyze its cloud resource consumption by different projects. It can create a tag, bind the created tag to resources, and set it as an allocation tag.
2.2 Allocation Unit
Cost Allocation Unit is a custom organizational structure. Based on your cost analysis dimension requirements, you can customize the cost allocation name and rules, and implement resource cost collection to achieve the purpose of cost allocation. Compared to allocation tags, cost allocation units are a more advanced cost allocation tool with more powerful and flexible features, suitable for scenarios requiring cost allocation across multiple dimensions.
For example, a company may have a more complex multi-level organizational structure and want to analyze its cloud resource consumption based on internal architecture. In such cases, you can create and manage your own cost allocation units and set cost allocation rules and sharing proportions. When expenses occur, Tencent Cloud will automatically collect and allocate them to the corresponding cost allocation units based on the settings, thereby achieving automated cost allocation and management.
3. Cost Analysis: All-In-One Cost Data Analytics
3.1 Cost Explorer
Because the structure and scale of bill cost data are large, the billing side provides cost analysis capability as an all-in-one online tool to assist customers in efficiently and quickly understanding and analyzing costs.
Visualize statement data with BI power to help customers quickly understand cost components and trends.
Update cost data in near real time
Support splitting and aggregating cost data by product, region, tag, and eight other dimensions.
Flexibly select a time window to support slice analysis by month or day.
Analysis results can be saved as cost reports.
For special billing modes like saving plans, a specialized analysis view is provided for usage.
Support AI cost analysis and AI auxiliary filter for cost data
3.2 Spend Projection
Spend projection feature is based on your historical consumption on Tencent Cloud, using AI and machine learning algorithms to predict future cloud costs. It helps you understand and manage cloud costs in advance.
Note:
The predicted spend for the current month is shown in the line chart and bar chart, with actual fee as a solid line and predicted fee as a dashed line.
4. Budget Management: Underwrite Cost Control through Budget Preparation and Trace
As a core means of cost control for enterprises, the cloud billing platform configures resources based on strategic goals and achieves cost localization and trace through comprehensive budget management capabilities.
Flexible customization to configure budget and support through AI capability to optimize
When creating a budget, users can maximize flexible configuration. You can set it based on all costs or specify partial dimensions and payment methods, with AI capability to perform optimization.
Multiple methods to trace and alarm, timely discovery of cost issues
After budget configuration, real-time alerts are supported based on budget thresholds or cost fluctuations to avoid exceeding expected costs.
Monitor budget achievement on the dashboard and analyze implementation results
Provide a budget analysis view to check the history of budget implementation and alarm trigger frequency, and judge whether the control policy is valid. Based on the budget analysis results, adjust the budget through scrolling and finally align the plan with the actual.
Support setting budget threshold and fluctuation value alert. For detailed setting method, see Budget Management
5. Anomaly Detection: Help Customers Identify Potential Abnormal Charges through Algorithm Detection
Cost anomaly detection can help you efficiently identify and warn of exceptional fluctuations. Based on the cost anomaly detection result, you can make decisions as soon as possible to reduce costs and risk.
Enable or disable anomaly detection and tolerance threshold for annual/monthly subscription and pay-as-you-go billing. Control anomaly detection sensitivity by setting the deviation tolerance threshold. The smaller the threshold, the more sensitive the detection.
6. Cloud Inspection Optimization Suggestion: Give More Cost-Effective Configuration Suggestions Based on Running Conditions
Tencent Cloud Smart Advisor - Cloud Inspection provides a wide variety of assessment items, flexible assessment configuration, and system optimization suggestions to help improve business continuity.
Multiple cloud services are covered across the dimensions of security, reliability, cost, service limitations, and performance, with each dimension including multiple risk assessment items.
The cost inspection strategy mainly focuses on efficient utilization of cloud services, avoiding unnecessary expenses and resource waste. It helps cloud users understand cloud resource cost distribution through technical measures, balancing business objectives with cloud costs, and enhancing the alignment between environment and business requirements. Continuous optimization aims to reduce cloud service expenses, improve operational efficiency, and achieve the best cost-effectiveness.
7. Saving Plan: Obtain Lower Discounts through Committed Consumption
Savings Plans (SP) is a discount model provided by Tencent Cloud that can offset bills for pay-as-you-go instances billed by hour. By committing to a certain amount of consumption per hour over a fixed term (1 or 3 years), you can enjoy lower pay-as-you-go discounts (close to the cost of annual/monthly subscriptions), saving you more. Compared to annual/monthly subscription instances, the combination of Savings Plans and pay-as-you-go instances offers greater flexibility in use.
Savings plan advantage
Flexible resource usage: Use savings plan with pay-as-you-go instances. Pay-as-you-go instance specifications can be flexibly adjusted.
Cost savings: Commit to consuming a certain amount within 1 or 3 years in exchange for a lower pay-as-you-go discount.
Flexible payment: Support 0 upfront, partial upfront, or all upfront modes to ease your cash flow pressure.
Deduction capacity: Bills within the pledged amount per hour are charged at the minimum price. The part exceeding the pledged amount per hour is charged at the standard unit price by quantity, and invoices are issued separately.
How it works
The user commits to consuming a certain amount per hour. Usage within the user's hourly committed range is eligible for the savings plan discount price, while usage exceeding the range is charged at the normal pay-as-you-go rate. The savings plan charges the full committed amount per hour, even if the user's actual usage does not reach the committed amount.
Savings plan purchase
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