Ep#159 Architecting Cloud Cost Savings with Mike Julian from The Duckbill Group

October 20, 2023

Episode Summary

#finops #awscloud #costoptimization

Highlight from the "Faces in FinOps" Podcast. Full EP Here:

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In this Highlight of the Faces In FinOps Podcast, we dive deep into the world of FinOps with a special guest, Mike Julian, the CEO and Co-founder of The Duckbill Group. Mike shares his journey and expertise in the realm of cloud cost management, shedding light on their unique approach to optimizing AWS costs.

As the leader of The Duckbill Group, Mike emphasizes the importance of architectural choices over traditional cost-saving methods like Reserved Instances and Savings Plans. Their focus on understanding and influencing costs at the architectural level has led to impressive results, with over $4 billion in contracts negotiated for their clients.

Mike and Jon discuss the evolution of FinOps maturity within organizations, emphasizing that it's not always a linear path. Instead, it depends on the organization's growth and changing priorities. They also touch on the common mistakes mature FinOps teams make, such as adopting a gatekeeping posture and the challenge of educating engineering teams about cost-saving options.

In the spirit of recognizing the unsung heroes of FinOps, Mike gives a shout-out to the countless practitioners working behind the scenes, making incredible strides in optimizing cloud costs within their organizations, even if they can't always be in the public eye. Join us for this insightful conversation with Mike Julian, where we explore the dynamic landscape of FinOps and cloud cost management.

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Mike Julian Headshot

About the Guest

Mike Julian

Beside his work with clients on their cloud cost management practices, Mike is the author of O’Reilly’s Practical Monitoring, previously wrote the Monitoring Weekly newsletter and hosted the Real World DevOps podcast. His background includes DevOps/SRE/sysadmin roles for companies such as Taos Consulting, Peak Hosting, Oak Ridge National Laboratory, and many more. Mike is originally from Knoxville, TN (Go Vols!) and currently resides in Portland, OR.

#aws #awscloud #finops #cloudcomputing #costoptimization

Episode Show Notes & Transcript

Guest: Mike

Hi, I'm Mike. I am the co-founder and CEO of The Duckbill Group. Also the partner and Wrangler of Corey Quinn, most of that's a full-time job. Most of you watching will know that one more than you know me. Essentially, I run the doc bill group. So we've been around for about four and a half years working exclusively on a w s cost management, and it's been a wild ride. We don't pay a lot of attention to RIS and savings plans and a lot of the common financial constructs. Yes, we could do those things and we understand them, but a lot of our work comes in at the architectural level. We believe that your architectural choices are what drive your cost, not idle resources and such. In addition to that, we help our clients with a D Ss contract negotiation. About half of our work is helping negotiate those contracts. To date, we are just over 4 billion in contracting negotiated, so we've been doing quite a bit of those too. We do all the things that the #FinOps Foundation talks about. We do all the things that #FinOps is about, but we don't do them ourselves. We have a $ 6,000-a-year bill, and I just don't care about it. I never look at it. I don't care. It's immaterial money. My tagging practices are awful. The Cobbler’s children have no shoes, which perfectly describes duck bills' cost management practices.

Host: Jon

I have heard that and said that probably three times in the last couple of days.

Guest: Mike

It's true. The reason for that is because we spend all of our effort working on our client's bills. Instead, our clients average about a million dollars a month. So the amount of effort that we can put into them compared to us, we don't care about our costs. So we work with our clients on not really controlling costs, not always lowering costs. One of the things that we've found is it's not necessarily about making the bill smaller. Often it's about having a better understanding of what's driving the bill. The CFO is going to hit you with a stick.

Guest: Mike

If your bill is behaving erratically, that's the problem. If your bill is 5,000,001 per month, 3 million the next month, 10 million the month after, that's a problem. And even if the numbers are consistently lower, that's still a problem. What matters is whether are we spending the money in the places we should be spending the money and the size of the bill is irrelevant to that point. And do we understand why we're spending it? Do we understand what's driving those costs? And that is a good thing for us. So a lot of our work is really in helping our clients understand what's driving them and how they can have a better understanding of that and better influence their cost. Some clients spend vastly more money after we're done and are happy to do it because they have a better understanding of why they're doing it. But a lot of the work that we do is about, its some level reducing costs, which we believe is all about optimizing architecture decisions.

Host: Jon

I like that approach. Are you seeing your customers, and their rank of maturity going from a crawl, a walk, a run within the #FinOps culture, or a variation of them? What does it look like from an outside perspective?

Guest: Mike

It varies. I will say that in a very large company, you can never say this company is mature. What you see instead is there are pockets of maturity. What I see most often is there is a central #FinOps function, and then there are engineering teams that are doing their cost management practices to some degree in conjunction with something the central team is providing

Host: Jon

In a run, right? They're not in a run long or they're a small amount of a run while they're implementing variation things of the culture throughout their journey. And that if you're not constantly changing your maturity level from run to crawl to walk, whatever it is, then I think you're not always improving or there's new things not happening and you're not doing it right.

Guest: Mike

So you make a great point there because when people think about maturity levels, having a maturity level model to begin with is I think sort of broken because let's say that I'm a small company today and I have a $6,000 a month bill today I have very low maturity. If I had no money, then I would probably have very high maturity on this because I'd be paying a lot of attention to it. So at some point, I'm going to improve my maturity of how I manage my bill. Let's say that I then go raise $40 million and now I'm hiring a whole bunch of new engineers to build this product. What do you think my maturity is going to be? I'm not going to suddenly improve on that. I'm going to regress, and that's fine. There's no problem with that, but I think it's misguided to think that as a company grows, its maturity level also grows linearly. It goes up, it should not go up. It changes over time, and that's fine. And I think the more important thing is to be aware of when is changing and why it's changing.

Host: Jon

Mike, I just asked you about some of the biggest mistakes immature make, but I want to flip that. Do you see even mature #FinOps teams make mistakes and what are they? I

Guest: Mike

Do, man, that is a great question. The biggest mistake that I see mature #FinOps teams make is that they can often fall into a command and control structure, sort of a gatekeeping posture with engineering teams, and that's pretty bad. You end up in this situation where engineering wants to do something, and now #FinOps is sort of, they have to do a review before engineering can make the decision wrong direction. Finance has never been the gatekeeper to doing engineering work like they intentionally are not for #FinOps to do so. Bad idea, even security should not be a gatekeeper to engineering doing their job. All of these roles are supporting roles to getting the product shipped. So you have to not have a gatekeeping posture, which is hard to do because a lot of teams believe that a lot of #FinOps teams can fall into this mistake and believe that their job is to control the cost and it's not.

Guest: Mike

Their job is to enable engineering to make better decisions. Azure and G C P, Oracle, Alibaba, I have no idea what they're doing. Neither do I. Yeah, so staying on top of the pace of changes coming from a W Ss is always hard. Shout out to last week in a W Ss. But I think the really hard part there is that we still see teams not adopting things like S three intelligent tiering, and it's like, well, hang on a minute. That came out what? 20 20, 20 21. It's years old at this point. What the heck? Why is no one adopting it? And it's that they don't know. And I think one of the hardest parts is you can't shame an engineering team for not knowing.

Guest: Mike

You have to think, why don't they know? Well, they have a bajillion other things they're thinking about. So we see some struggles with education just like, here are the options you have, even down to things like, Hey, you have this application that by how it's designed could be a great candidate for Lambda. But the team has no experience with Lambda, so they've never considered Lambda, and the organization doesn't have a lot of other Lambda usage, so no one's willing to be the first one to try it. It's like, well, that sucks. How do you get through that? And at some point, someone has to say, okay, I'm going to do this. I'm going to try it. I'm going to push to make that happen. Well, someone's got to tell 'em that's okay. Someone's got to tell them it was an option to begin with. So a lot of the education is just a really big challenge, and this becomes a massive challenge when you're working with very large organizations.

Host: Jon

Mike, as we wrap things up, who are some of the most influential practitioners in #FinOps today?

Guest: Mike

Well, John, I'm going to say you just to pander. I'm

Host: Jon

Touched, man.

Guest: Mike

One of the things that I will give a shout-out to all the people who were not public, we work with some of the most amazing people at our clients who are just incredibly good at what they do, and they're not public for various reasons. Many of them work in organizations where they aren't allowed to be public, but they're doing amazing work. So I know a lot of them follow this channel. A lot of them will probably see this video. So I will say, shout out to all the people doing amazing work who aren't public.