In today’s rapidly evolving cloud computing landscape, the importance of effective cloud cost management cannot be overstated. As organizations increasingly adopt public cloud infrastructure, the need for implementing FinOps is crucial for achieving a successful cloud adoption. As organizations implement FinOps, they quickly realize a dedicated FinOps tool becomes necessary to manage the vast challenge of allocating and governing 100% of their cloud infrastructure. 

This blog post will explore the importance of FinOps tools and how the Forrester Wave™ report can guide you to find the best suitable FinOps tool for your organization.

For details on FinOps Tools and Services click here.

The Role of Tooling in FinOps

As cloud usage scales, so do the associated costs, making it imperative for organizations to gain visibility into their cloud expenditures and optimize them effectively. In the context of FinOps, the following four key elements are critical to success in the current market: visibility, optimization, unit costs, and automation. The effective use of these elements depends heavily on having the right tools.

1. Visibility: To manage cloud costs effectively, organizations need a clear and unified view of their spending, ideally through a tool that can do so across all major cloud providers, including AWS, Microsoft Azure, and Google Cloud. The most effective tools provide this visibility with customizable dashboards that present cloud usage and costs in an easily digestible format, enabling businesses to monitor and analyze their expenditures in real-time.

2. Optimization: Beyond visibility, tools must offer actionable optimization recommendations. These tools should analyze the cloud environment and suggest ways to reduce costs, such as rightsizing instances or identifying underutilized resources.

3. Unit Costs: Understanding cloud unit economics is another critical aspect. Tools that calculate costs per deployment, team, or application allow businesses to tie cloud spending directly to business outcomes.

4. Automation: As cloud environments become more complex, automation is key to maintaining efficiency. Effective tools should automate routine cost management tasks, such as scaling resources in response to demand or shutting down idle resources, aligned with the interests of the responsible team/persona.

According to the Forrester Wave™ report, the top-performing vendors in the CCMO (Cloud Cost Management & Optimization) space are those that excel in offering tools that not only support optimization across all major cloud platforms but also integrate seamlessly with services beyond just infrastructure. This enables a comprehensive view of total costs, covering public cloud, on-premises infrastructure, and even software-as-a-service (SaaS) and platform-as-a-service (PaaS) solutions. Additionally, the best tools align engineering decisions directly with business goals, allowing for precise calculations of cloud unit costs closely tied to workflows, such as costs per deployment or per application.

In summary, the success of a FinOps strategy hinges on selecting tools that provide deep visibility, actionable optimization, granular cost analysis, and automation. These capabilities are essential for managing and optimizing cloud costs in a way that supports overall business objectives.

The results of the Forrester Wave™ report

The Forrester Wave™ report is designed to evaluate & assess the different FinOps tools via Scorecards. The report involved 12 different FinOps tools in their rating. In total the report assessed 25 criteria to find the best tools within the market.

If you want to read the full report, please click on the link.

The result of the report indicates that organizations aiming to implement a robust FinOps strategy, IBM’s combined Cloudability and Turbonomic solution represents the most sophisticated and comprehensive option on the market. Cloudability delivers deep cost management insights and customizable dashboards for better oversight, while Turbonomic adds value with comprehensive Application and Infrastructure Performance Management, ensuring real-time visibility across both on-premises and cloud-based environments.

Together, these tools form a powerful solution that not only delivers superior optimization recommendations but also integrates seamlessly to provide a unified view of cloud costs and usage. IBM’s ambitious roadmap includes plans to further integrate Cloudability and Turbonomic into a single portal, which will enhance its capabilities even further. Although this integration is ongoing, its potential is significant. In September 2024 IBM announced the acquisition of Kubecost (Kubernetes Cost Monitoring tool) and will integrate the solution to their product suite. The combination of Cloudability, Turbonomic and Kubecost will result in a very powerful solution and will foster the leading role of IBM in the FinOps tooling sector.

However, IBM’s high pricing and the mandatory purchase of additional consulting services may be drawbacks for some organizations, particularly those with smaller budgets. Despite this, IBM remains the best choice for large enterprises seeking to maximize the value of their cloud investments.

Competitors in the Cloud Cost Management Landscape

While IBM leads the pack, the Forrester Wave™ report also categorizes other notable vendors into Leaders, Strong Performers, Contenders, and Challengers, each bringing unique strengths to the table.

Leaders: Setting the Benchmark

In addition to IBM, Broadcom and Flexera are also recognized as leaders in the CCMO space. Broadcom’s CloudHealth is well-established and remains a top choice, particularly noted for its strong access and permissions management through its FlexOrgs capabilities, as well as its comprehensive reporting and monitoring features. The ability to tailor reports to specific personas and groups is particularly valued, though some customers have expressed concerns about the company’s pace of innovation. Flexera stands out for its seamless integration of IT asset management (ITAM) with cloud cost management, providing pricing flexibility and transparency. Flexera also excels in billing administration, resource discovery, and integration, though the Forrester Wave™ report suggests that expanding its strategic vision will be crucial for maintaining its leadership position.

Strong Performers: Innovators in a Competitive Market

The Strong Performers group includes Harness, Morpheus Data, CloudBolt, and CloudZero. Harness is praised for its market-leading features like auto-stop and cluster cost breakdown, along with its user-friendly admin portal and a promising roadmap. However, it needs to enhance its cloud platform placement recommendations and improve cost planning and assessment capabilities. Morpheus Data stands out with its strong automation, flexible pricing, and superior multicloud management, offering robust resource recommendations, though its cost management features are still evolving. CloudBolt and CloudZero are also noted for their strong integration and innovative approaches, but both need further development in areas like cloud platform placement and on-premises management.

Contenders: Solid Choices with Room for Growth

In the Contenders category, OpenText is recognized for its strengths in hybrid cloud management, as well as its on-premises and automation capabilities. OpenText benefits from a well-established partner ecosystem but needs to advance its offerings to match more commoditized CCMO features.

Challengers: Niche Players with Specific Strengths

The Challengers category includes Nutanix, NetApp, Kion, and Virtana. Nutanix excels in customer support and hybrid cloud management, though it has shifted its focus away from CCMO towards consultancy, with no plans to add new capabilities to its CCMO offering. NetApp is acknowledged for its solid foundational CCMO capabilities, bolstered by its CloudCheckr and Spot acquisitions, although it has yet to complete the integration into a unified portal. Additionally, NetApp does not currently offer Google Cloud billing and optimization. Kion provides a compelling solution for highly regulated industries with its on-premises capabilities, but it falls short in more standard CCMO features. Virtana is recognized for its hybrid cost management expertise, though it lags in some of the core functionalities expected in the broader CCMO market.

Below you can see the full results of the Forrester Wave™ report with the categorization of all the evaluated FinOps tools.

Conclusion: Choosing the right FinOps tool

As businesses continue to navigate the complexities of cloud cost management, tools that provide visibility, optimization, and integration will be essential for driving efficiency and achieving financial goals.

The Forrester Wave™ report for Q3 2024 offers a detailed analysis of the leading vendors in the CCMO market, highlighting their strengths and weaknesses. As cloud cost management becomes increasingly vital to business operations, selecting the right tool is crucial. IBM, with its integrated Cloudability and Turbonomic solution, clearly leads the market, offering a comprehensive and robust option for enterprises willing to invest in top-tier capabilities. Furthermore, IBM announced the acquisition of Kubecost in September 2024 which will improve their Kubernetes cost monitoring and automation & will foster their strong positioning in the FinOps tool landscape.

However, the report also identifies strong alternatives, each with its own distinct advantages. Whether you prioritize innovation, flexibility, or specific niche capabilities, the vendors classified as Leaders, Strong Performers, Contenders, and Challengers offer a variety of options to meet diverse needs and budgets. 

The most important advice before purchasing a solution is to collect the requirements of all the different stakeholders and to assess the tools based on these requirements. The Forrester Wave™ report serves as an invaluable guide for making informed decisions in this critical area. Furthermore, the best tool is only useful if people actually use it. Try to make it as easy as possible to use for the stakeholders and iterate on their requirements. For more information, please check our blogpost article about successful implementation of a FinOps tool.

If you need advice or support in finding the right FinOps tool for your organization or implementing it, take advantage of our expertise and contact us.