The concept of cloud units, designed to tie cloud costs and resources to a standardized unit of business value, has been hailed as a solution to the complexities of cloud economics. However, this approach has been criticized for its oversimplification of complex cloud ecosystems, failing to account for the nuanced priorities, goals, and strategic outcomes unique to each business.
In reality, cloud units reduce dynamic cloud environments into overly simplistic metrics that fail to provide actionable insights for business leaders. This one-size-fits-all approach may benefit teams just starting their cloud finops journey, but it rarely holds up at scale or when business contexts grow more complex. The inherent chaos of cloud environments, with thousands of workloads across hundreds of services, makes it nearly impossible to reduce an entire cloud ecosystem to a single unit cost.
Moreover, cloud units assume that all workloads should be mapped to the same primary output, such as the lowest cost per transaction, cost per gigabyte, or cost per instance hour. This fails to recognize the individuality of enterprises and their goals. For instance, a healthcare organization trying to calculate the cost of securely storing patient records won't appreciate being lumped into the same framework as a video streaming service measuring costs per viewer.
Furthermore, value isn't always financial. Cloud investments often yield strategic gains, such as greater agility, innovation, or customer satisfaction, which are hard to quantify using a standardized metric like cloud units. Consider an enterprise that invests heavily in real-time analytics, where the immediate output might show relatively high costs but also long-term competitive advantages like better decision-making or improvements in customer retention.
In contrast, bespoke metrics, which are tailored to each organization's specific needs, offer a more effective approach. These metrics can balance tangible costs with intangible benefits, enabling deeper inspection and data-driven decision-making. For example, a media company might track cost per stream, while a retail operation might track cost per fulfilled order.
The finops community must rethink its approach to measuring cloud value, recognizing that generic metrics are insufficient to capture the complexity of cloud environments. As the author warns, oversimplifying cloud value can lead to an incorrect understanding of cloud value, causing companies to misinterpret valuable strategic spending as waste.
In conclusion, the promise of cloud units as a solution to measure cloud costs and deliver business value has been overstated. Instead, bespoke metrics that adapt to each organization's unique needs and goals offer a more effective approach to measuring cloud value and driving business success.