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FinOps Case Study: Achieving Cloud Total Cost Ownership of web-based applications for a large New Zealand government ministry.

7 minute read

Customer Overview
A leading New Zealand government Ministry faced significant cost challenges in managing its web operations. The lack of financial transparency hampered its ability to optimize costs effectively.

Key Challenge
The primary challenge was to provide a full Total Cost Ownership of the web application portfolio and provide show back to the wider business users of cost to serve for product owners of their web application.

This lack of clarity prevented the effective identification of cost-saving opportunities and hindered the strategic allocation of resources and underutilized applications.

 


YäRKEN Solution

YäRKEN was implemented in five days, integrating seamlessly with existing data sources such as

  • General Ledgers
  • Labour timesheets
  • AWS cost reports
  • Google Analytics

     

The platform utilized the Technology Business Management (TBM) & FinOps Focus framework to achieve precise cost allocation and comprehensive visibility into the Total Cost of Ownership (TCO) of web applications.

This rapid deployment allowed the NZ government ministry to quickly address inefficiencies and recalibrate its financial strategy.

 

 FinOps Principles applied

  1.  Transparency and Granularity in Cloud Financial Reporting:
    YäRKEN enhanced the visibility of all costs (Labour/Infrastructure) related to Cloud financial data, allowing stakeholders to see and understand the specifics of web operations costs, which facilitated better-informed decision-making and allow senior management to decide on.

  2.  Cost Allocation and Chargeback Systems:
    Through detailed analysis facilitated by YäRKEN, the enterprise identified and decommissioned two unused applications, resulting in annual savings of approximately $140k. Additionally, by analyzing mobile service costs, they uncovered an opportunity to save $30k annually by optimizing variable costs.


  3. Responsive Financial Management:
    The platform’s ability to integrate and analyze data in real-time meant that financial and value-based decisions could be adjusted in real-time, based on the most current and relevant data.

  4.  Strategic Resource Reallocation:
    Through detailed analysis and identification of underperforming assets, YäRKEN enabled the company to decommission redundant applications and websites quickly, reallocating resources more efficiently.

Achievements in Cost Savings

Immediate Decommissioning: Right after deployment, YäRKEN identified two redundant SaaS platforms, eliminating them to save $7,200 annually.

Rapid Unit Economics Optimization: A detailed review led to the swift decommissioning of a low-traffic site, which saved about $30,000 annually.

Enhanced Financial Accountability: Complete cost recovery and implementation of show back and chargeback systems were achieved shortly after YäRKEN's integration, enhancing financial transparency and accountability across the digital technology business unit.

AWS Optimization: YäRKEN provided the justification to optimiz AWS database services, yielding an annual savings of approximately $110,000.

Conclusion

YäRKEN's swift implementation and immediate effectiveness in applying FinOps principles transformed the company's financial management practices. By rapidly identifying and implementing cost-saving measures and enhancing financial accountability, the company not only achieved significant savings but also set a new benchmark for financial efficiency in the digital era.

The ROI of savings achieved provided payback in 5 days of implementation for the customer with over 1 year of usage of the YäRKEN platform licence fees paid for.

 

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