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Cloud Financial Administrators: Delivering SaaS, IaaS, PaaS Cost Controls?

Many enterprises are exploring ways to align procurement processes with cloud services. As such, a new role is emerging among enterprises – the cloud financial administrator (CFA). But is the CFA really required?

Enterprise users sometimes struggle to understand cloud pricing models. In addition, few enterprises employ a chief financial officer (CFO) for IT to analyze and manage SaaS, IaaS and/or PaaS spending.

A CFA would oversee enterprise cloud consumption management, optimization and billing, 451 Research founder William Fellows wrote in a blog post. This administrator would possess specialized knowledge about on-demand infrastructure costs, characteristics and services and enterprise application needs.

Moreover, a CFA would help enterprises keep pace with new cloud services and maximize their cloud investments, Fellows stated.

Benefits of a CFA

Enterprises could benefit from a CFA in several ways, including:

  1. Reduced Cloud Expenses: A CFA would understand and assess the cost infrastructure of cloud services.
  2. Improved Cloud Management: A CFA would provide insights into cloud services and analyze service-level agreements (SLAs).
  3. Increased Cloud Adoption: A CFA would align enterprise efforts with cloud initiatives.

Also, a CFA may enable enterprises to embrace new growth opportunities.

“Removing barriers to scaling applications can allow product and marketing teams to take calculated risks, reaching new markets before opportunities are lost. It can also allow new employees to hit the ground running, with access to the applications they need from day one,” Fellows noted.

Is a CFA Worth the Cost?

The push to lower enterprise cloud costs may accelerate the demand for CFAs over the next few years.

Enterprise cloud costs may range from thousands to millions of dollars, Fellows pointed out. Meanwhile, many enterprise users told Fellows they believe the salary of a CFA “would likely be quickly repaid in the (cost) savings achieved.”

Still, cost-optimization tools may prove to be viable alternatives to hiring a CFA, some vendors assert.

Cloud cost-optimization tools often are easy to implement, use and maintain, ParkMyCloud wrote in a blog post. As a result, these tools may help enterprise users manage their cloud costs effectively.

“The salary of any cost-savings hire should, of course, be lower than the amount that person saves the organization. If your enterprise’s cloud infrastructure is extensive enough to cover a CFA’s salary, it may seem like a cost-effective decision,” ParkMyCloud noted. “However, this can be done in a simpler and more cost-effective manner by introducing cost-optimization tools.”

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