basics Flashcards
Anomaly management
Ability to detect, alert, and manage unexpected cloud cost events in a timely manner.
cloud cost anomalies
Unpredicted variations resulting in increases in cloud spending that are larger than would be expected given historical spending patterns.
cost-driven anomalies
Process of identifying spending deviations from the expected norms.
chargeback
Allocation strategy of actual consumption spend of IT services from finance systems back to user teams via an internal invoice. Holds business units directly accountable for IT spend.
showback
Actual consumption of IT services is shown to business units, while the spend is being charged to a different business unit.
amortized costs
distributes the up-front fees across each hour of billing.
budgeting
Estimation of revenues and expenses companies plan to spend within a time period.
budget vs actual
Reporting on BvA forecast to establish trends.
capital expense
an asset of the company that benefits future periods.
operational expense
only benefits the current period.
cost allocation
splitting up a cloud bill and associating costs to each cost center.
cost estimation
Process of quantifying every resource that will be required to complete a project also used to help create budgets.
forecasting
Predicting future spending. History + plans.
fully-loaded costs
actual discounted rates a company is paying for cloud. Factors in shared costs and mapped to business org structure.
metrics
A formula for measuring something with the purpose of obtaining results.
shared costs
Charges which are utilized or attributed to multiple owners, applications, or products.
unblended rates
Reporting comparable costs without consideration to discounts.
workload
amount of work performed or capable of being performed within a specific period. measured in compute / memory / storage.
cloud center of excellence
A cloud center of excellence is a team that leads cloud strategy, governance, and best practices in an organization.
FinOps
Operational framework and cultural practice which maximizes the business value of cloud, enables timely data-driven decision making, and creates financial accountability through collaboration between engineering, finance, and business teams.
Objectives and Key Results (OKR)
Goal system to create alignment and engagement in a business around measurable goals.
Amoritization
Retiring a payment of capital gradually over time on a schedule which reflects the benefits the capitcal provides in each period.
resource-based commitment
Must be purchased in a single region or zone.
break even definition
Estimated length of time to pay off the entire cost of commitment based discount (including upfront and ongoing charges) from the savings provided by that commitment.
capacity reservation
secure compute capacity for your CSP instances in a particular region or zone.
commitment length
the duration for which a customer commits to using a CB Discount for cloud services.
commitment utilization
the percentage of active commitments utilized during the specified period.
coverage
The percentage of eligible workloads that were covered by active commitments during the specified period.
payment option
Commitment Based discounts can be paid in various predefined increments.
queueing purchase
Plan the purchase of a commitment based discount ahead of time.
tenancy
Describes if the hardware owned by the CSP that your cloud instances are running on is only able to be used by a single organization (dedicated) or if it could be used by multiple organizations (shared).
corporate finance
company financial decisions to maximize shareholder value.
operational efficiency
The difference between the input (costs/employees/time) required to keep the org running and the output (revenue/dev time/security/customer retention) it provides.
capital efficiency
measures how much funds are invested versus how much revenue is generated.
capex
cost to acquire or improve physical assets ( property, plant, equipment ).
opex
Variable running costs.
free cash flow
The measure of the amount of cash that a business generates after accounting for CapEx. A measure of the cash available to pay dividends, reduce debt, make acquisitions, or invest in new projects.
