Apply FinOps Lifecycle in AWS Using Built-in Tools

By now, you may already have some knowledge of FinOps, or perhaps you’ve come across the term somewhere.

If not, feel free to check out my post: What is FinOps and Why It Really Matters Today?

Now, coming back to this post.

Progress in any area requires a repeatable process.

Take growing a plant as an example:
You plant the seed, water it, give it sunlight, and repeat the process. With consistent care, the plant grows over time.

Similarly, FinOps is an ongoing journey, not a one-time fix. It evolves as your cloud usage and organization grow.

To see real progress and grow the value of your business through cost optimization, you need to follow a consistent lifecycle.

FinOps Framework

The FinOps Foundation defines its framework in three phases: Inform, Optimize, and Operate. Each cycle builds momentum by enabling better decisions and greater efficiency.

Image source: FinOps Foundation

Let’s break down in brief what each phase is all about.

Inform

The main goal of this phase is to understand your cloud costs.

It's all about gathering information on what resources you have, how they're being used, who is using them, and how much they're costing, using the right tools and techniques.

With this data, you gain clear visibility into your cloud spending and understand the business value of that spend. This helps you plan better for optimization, budgeting, and cost allocation.

Optimize

Once you understand your cloud spending, this phase is about making improvements.

Start by sharing cost reports with both technical and finance teams. Identify unused or underutilized resources, rightsize them, and explore pricing options such as commitment-based savings plans.

If needed, consider re-architecting for long-term efficiency and value as well.

Collaboration between engineering, finance, and business teams is key to success in this phase. Not just focusing on reducing costs but on maximizing the value of your cloud investment.

Operate

You have the data, and you've started optimizing. Now it's time to put these practices into daily operations.

Establish policy rules and governance for cloud usage. Set up monitoring for resource usage and alerts for spending thresholds to ensure compliance.

Educate teams and individuals about cloud cost ownership. Use insights from the Inform phase and strategies from the Optimize phase to create actionable guidelines.

Most importantly, leverage automation to improve efficiency and consistency.

These three phases are ongoing and repeat over time. As your organization grows, the process should evolve to drive continuous improvement and better outcomes.

AWS Cloud Financial Management Framework (CFM)

Similar to the FinOps framework, AWS has its own Cloud Financial Management (CFM) Framework, which includes four key pillars: See, Save, Plan, and Run.

AWS CFM aligns with the core concepts of FinOps but is designed specifically for the AWS environment, using native tools and services to achieve its goals.

Its primary goal is to help customers achieve their business outcomes in the most cost-efficient way, accelerating economic and business value while maintaining the right balance between agility and control.

Image source: AWS

See

This pillar focuses on gaining visibility into where your cloud costs are coming from. It enables the finance team to track spending patterns and hold teams accountable for their usage.

You can get started by implementing a strong AWS tagging strategy and, if using multiple accounts, setting up a structured account hierarchy for achieving cost transparency.

AWS Services: AWS Control Tower, AWS Organizations, Cost Allocation Tags, Tag Policies, AWS Resource Groups, AWS Cost Categories, AWS Cost Explorer, AWS Cost and Usage Report, RIs and SPs

Save

This pillar is about cost optimization through strategic use of pricing models and efficient resource management.
Examples include:

• Purchasing Reserved Instances or Savings Plans

• Using Spot Instances for fault-tolerant workloads

• Scaling efficiently with Auto Scaling Groups

• Rightsizing resources

• Terminating wasteful and idle resources

AWS Services: RIs and SPs, Amazon EC2 Auto Scaling Groups, Spot Instances, AWS Compute Optimizer, AWS Trusted Advisor, AWS Instance Scheduler

Plan

Once you gain visibility into spending, the next step is forecasting and budgeting. AWS allows you to build flexible, dynamic budgeting processes that help you monitor if spending aligns with expectations.

AWS Services: AWS Cost Explorer, AWS Cost and Usage Report, AWS Budgets

Run

The Run pillar is about operational cost control and governance. It includes setting up guardrails, automating policies, and using monitoring tools to stay within budget and detect anomalies.

AWS Services: AWS Billing and Cost Management Console, AWS Identity and Access Management, Service Control Policies (SCP), AWS Service Catalog, AWS Cost Anomaly Detection, AWS Budgets

Mapping FinOps and AWS CFM Frameworks

To better understand how the FinOps lifecycle aligns with AWS’s Cloud Financial Management (CFM) pillars, I created the following mapping.

This table illustrates how both frameworks complement each other and highlights the AWS-native tools and services that support each phase.

Note: ‘See’ and ‘Plan’ align with the Inform phase.

I hope you found this information helpful. I'd love to hear your thoughts or experiences in the comments below.

Thank you for reading,

– Alon