Setting thresholds for purchasing reservations

Organizations in the crawl stage of FinOps tend to purchase reservations on a schedule basis, that is, quarterly or semi-annually. For example, a FinOps analyst who works with the engineering team identifies the virtual machine SKUs that are being used consistently and proposes to purchase reservations. The engineering team then purchases the reservations, and the process ends until the next quarter comes, when it repeats.

Figure 11.2 – Quarterly reservation coverage

Schedule-based reservation purchasing has some downsides. When the workload is constantly evolving, having a fixed schedule to buy reservations results in coverage gaps. This coverage gap is essentially a loss of savings opportunities. The team could have purchased reservations more frequently if they had access to the right usage data at the right time.

Alternatively to schedule-based purchases, the FinOps team can set up a dashboard...