Case Study - Delivering Cloud Services with Budget Uncertainty

Challenge

While most federal agencies receive their funding from congressional appropriations, fee-funded organizations depend on fees charged to customers for services provided to fund many of their operations. This can become a challenge considering escalated costs associated with a fast-changing landscape. For one fee-funded agency, a 40% revenue drop triggered by COVID-19 travel restrictions compelled the agency to reassess its financial strategy. Tasked with maintaining delivery of technology services to internal and external stakeholders amidst budget uncertainties, the agency stood at the crossroads of challenge and change.

Solution

Facing unprecedented financial pressure, the federal agency engaged with ManTech, leveraging our proven expertise in supporting federal clients by providing innovative thought leadership to significantly reduce cloud operating costs. As their trusted advisor, we crafted and executed a roadmap anchored in the three phases of the FinOps Framework. The target was not just cost avoidance but a significant transformation of their multi-cloud enterprise operations.

Inform. The first phase focused on activities to provide better visibility into cloud cost. We developed and implemented an asset tagging strategy providing a showback capability and situational awareness to agency leaders. Liaising with government staff and their cloud reseller, we configured the agency cloud cost management tool to reflect actual negotiated credits / discounts, rather than default rates reflected in Cloud Services Provider (CSP) native tools. We have also conducted lunch and learn sessions with all members of the engineering and operations team to provide detailed overviews of the FinOps Framework,
application use cases, and opportunities for training and certification.

Optimize. During the optimization phase, we concentrated on enhancing the efficiency of the multi-cloud environment. In concert with the customer IT organization, our FinOps practitioners implemented an overarching enterprise cloud optimization policy and facilitated an agency-wide cloud cleanup operation. We liaised with Anything as a Service (XaaS) and CSP to commit to levels of service usage and lock in lower fixed costs. Our engineers implemented scheduling tags during lower utilization periods of compute and database instance types to reduce costs by $152k a month. We implemented intelligent tiering and other storage solutions, taking into consideration agency and federal guidance (e.g. M-21-31) for retention and access. Additionally, our engineers re- platformed agency applications to a solution which supported auto-scaling, reducing overprovisioning by 30%. We helped realize cost savings through the processing of Reserve Instance (RI) plans, and Savings Plans. We continuous applied a process to identify and optimize unused and over provisioned resources across the whole enterprise. To cement these ongoing best practices, we conducted Cost Optimization Business Strategic Reviews (BSRs) involving deeper well-architected reviews with selected accounts and systems.

Operate. In this phase, we focused on continued visibility and alignment of cloud use with agency goals. Our FinOps practitioners developed a role-based dashboard providing leadership visibility into both real-time cloud cost across their different CSPs, as well as a tally of costs avoided, enabling informed decision making. We convened regular meetings to explore new mission requirements, shared insights on cloud usage and cost trends, fostering strategic alignment. There are cases where the most cost-efficient setup may not align with the agency’s mission readiness. Profit is not the primary driver for federal agencies. Understanding this, we worked with finance, product, and engineering stakeholders to develop a cloud cost optimization exception policy and built it into the client’s service request workflow.

Impact

We thrive when our customer’s mission is successful. Through implementation of FinOps, our solution for this Federal Agency revolutionized their approach to managing cloud costs.

Our solution:

Avoided unnecessary costs of over $16.7M to date.
Accounted for cloud governance constraints unique to federal agencies
Provided real-time cloud cost and usage dashboards enabling leadership to make cost-aware decisions
Increased the number of cloud cost management tools in use to boost enterprise cost cutting practices
Advanced the culture of cloud financial accountability and collaboration among all FinOps personas