Executive Summary

FinOps

Chief information officers and IT leaders face the dual challenge of optimizing IT operations while simultaneously driving innovation in an increasingly complex marketplace. The intricacies involved in managing a diverse array of technology environments require enterprises to harness a multitude of tools and platforms to address unique operational demands spanning various departments and functionalities. Technological advancements often outpace traditional strategies, so it is essential for IT leaders to have a comprehensive understanding of the software solutions at their disposal.

The discipline of FinOps, or Financial Operations, has emerged as a critical strategy for enterprises aiming to optimize cloud spending and ensure financial accountability within cloud environments.

IT Management software plays a pivotal role in aligning technology initiatives with business objectives. As enterprises strive to enhance efficiency, reduce costs and maintain a competitive edge, these approaches become critical enablers of streamlined operations and effective resource allocation. Furthermore, as enterprises transition to more agile and cloud-centric architectures, the integration of comprehensive IT Management software platforms facilitates enhanced visibility, control and adaptability across the entire IT stack. This is particularly important as CIOs look to future-proof enterprise architecture and ensure that technology strategies are not only reactive but also proactive in addressing emerging challenges and opportunities.

ISG defines FinOps, or Financial Operations, as a critical strategy for enterprises aiming to optimize cloud spending and ensure financial accountability within cloud environments. As enterprises increasingly migrate to the cloud, the challenge of managing associated costs becomes paramount. FinOps addresses this challenge by fostering collaboration between finance, IT and business teams, creating a unified approach to manage cloud expenditures effectively.

At the heart of FinOps is the principle of collaboration, where stakeholders across various departments come together to align cloud spending with overall business objectives. This partnership reaffirms that financial accountability is not solely the responsibility of the finance department but is shared across all teams involved in the cloud ecosystem. By promoting an inclusive approach, FinOps contributes to a culture of shared responsibility and accountability for resource consumption and cost management.

A primary focus of FinOps is achieving cost efficiency. Enterprises adopting this discipline are equipped to eliminate waste and optimize cloud expenditure. This involves a thorough review of cloud resource usage, understanding pricing models and validating that resources are utilized efficiently. By continuously monitoring usage patterns and identifying areas of overspending, enterprises can make informed decisions to reduce costs without sacrificing performance or operational capabilities.

Real-time visibility into cloud spending is another essential aspect of FinOps. By implementing tools and processes that enable checks and balances, enterprises gain insights into cloud costs, enabling tracking and reporting of expenditures as they occur. This enhanced visibility facilitates a proactive approach to financial management, allowing organizations to identify trends, forecast future spending and adjust budgets as necessary. For IT and Finance leaders, having access to accurate and timely financial data is imperative for making strategic decisions that align cloud investments with business goals.

Governance and accountability are also cornerstones of the FinOps discipline. Establishing clear policies, budgets and guidelines enables oversight of cloud expenses. These governance structures empower enterprises to enforce accountability, making it easier to manage budgets and mitigate financial risks. By instituting strong governance practices, enterprises can cultivate a disciplined approach to cloud financial management, which in turn fosters greater operational efficiency.

Moreover, FinOps is not a one-time initiative, but an ongoing process focused on continuous improvement. We assert that through 2026, 1 in 5 enterprises will invest in a coordinated FinOps effort between IT and Finance to create visibility and accountability of public, private and hybrid cloud spending. Enterprise s that rely on cloud data analytics are better positioned to drive decisions that enhance financial operations over time. This iterative approach allows teams to refine their strategies, adapt to changing cloud environments and optimize resource allocation dynamically.

FinOps is an essential discipline for enterprises navigating the complexities of cloud financial management. By integrating financial strategies with operational execution, enterprises can align cloud expenditures with business objectives, enhance efficiency and ensure accountability across departments. For CIOs and IT leaders, investing in FinOps is crucial not only for managing costs but also for driving strategic initiatives that facilitate growth and innovation. Embracing FinOps as a fundamental aspect of cloud operations positions enterprises for long-term success and resilience in the digital age.

With the growing trend of cloud adoption and the increasing costs associated with cloud services, a strategic approach to FinOps has become essential for enterprises. Routine reviews of FinOps strategies and partnerships help optimize cloud spending and ensure cost accountability. FinOps software trends include:

• The rise of cloud spending: Understanding and managing costs associated with cloud computing has become more complex. A careful evaluation of current FinOps practices can uncover inefficiencies in spending and opportunities for better cost allocation. By scrutinizing existing partnerships, enterprises can ensure the most effective tools for cloud financial management are in use.
• Demand for financial accountability: As economic pressures mount, enterprises are increasingly held accountable for financial decisions. A strong FinOps strategy promotes transparency and collaboration between IT and finance teams, reinforcing the alignment of cloud spending with business objectives. Now is the time to assess FinOps solutions and partnerships to guarantee they support a culture of financial accountability.
• Proactive budgeting and forecasting: Proactive budgeting and accurate forecasting are critical to success. FinOps strategies that incorporate advanced analytics and forecasting tools enable enterprises to anticipate spending patterns and plan accordingly. Enterprises should re-evaluate FinOps partnerships to ensure access to the necessary analytics capabilities to drive informed budget decisions.
• Focus on cost optimization: With tighter budgets and a focus on maximizing returns, enterprises must prioritize cost optimization strategies. By reviewing FinOps practices, enterprises can identify areas for potential savings, streamline financial processes and enhance resource allocation. Validating that FinOps tools provide actionable insights into spending patterns will empower enterprises to make informed financial decisions that support overall business goals.

A solid FinOps strategy will not only promote responsible spending but also drive value across the enterprise.

By emphasizing cloud spending management, financial accountability, proactive forecasting and cost optimization, IT leaders can present a compelling case for refining their financial operations approach. A solid FinOps strategy will not only promote responsible spending but also drive value across the enterprise. 

Generative AI (GenAI) plays a pivotal role in enhancing IT Management software by automating complex processes, improving decision-making and driving efficiencies across various IT functions. By leveraging GenAI, enterprises can streamline service delivery, optimize resource allocation and proactively identify and resolve issues, ultimately leading to improved operational performance. Additionally, GenAI enables IT teams to generate insights from vast amounts of data, facilitating more informed strategic planning and enhancing collaboration among teams. As enterprises embrace digital transformation, IT Management software integrated with GenAI capabilities becomes essential for staying competitive.

In the FinOps space, GenAI is enhancing financial operations within enterprises by providing analytics, insights and automated decision-making functions. A practical use case is the generation of real-time financial forecasts based on spending patterns and usage data. This capability helps finance teams gain a better understanding of current spending and predict future costs, allowing for more accurate budgeting and resource allocation.

Another critical application of GenAI is the automation of cost categorization and tagging. By recognizing patterns in spending and identifying relevant categories, GenAI can streamline the process of organizing cloud expenditures, leading to improved financial visibility and accountability. This results in more strategic financial decisions and reduced overspending on unnecessary resources.

Additionally, GenAI can generate reports and dashboards that provide stakeholders with a clear view of cloud financial performance. These reporting tools help teams quickly grasp complex financial data, facilitating better discussions on cloud costs and strategy. Furthermore, GenAI enables customized alerts for financial anomalies or overages, allowing finance and IT teams to respond promptly.

GenAI empowers organizations to maximize returns on cloud investments while minimizing wasted resources.

Lastly, one of the most impactful uses of GenAI in FinOps involves the generation of tailored recommendations based on analysis of cloud resource utilization. By providing insights on the best ways to optimize spending, such as rightsizing instances or recommending specific pricing models, GenAI empowers organizations to maximize returns on cloud investments while minimizing wasted resources.

Agentic AI, while not yet available, has the potential to transform FinOps by improving cloud cost management and financial accountability. One anticipated application is automating financial analyses and reporting, enabling real-time insights into trends and cost-saving opportunities. Additionally, it could enhance budgeting and forecasting by analyzing past financial data to inform decision-making. Agentic AI may streamline cost allocation by categorizing expenses and mapping them to specific projects, increasing financial transparency. Furthermore, it could alert finance teams to budgetary risks or overspending in real time. Overall, its future integration could enhance financial management and strategic decision-making in enterprises and should be part of an evaluation of FinOps software providers.

CIOs and IT leaders should approach IT Management software that incorporates GenAI, LLMs and future Agentic AI capabilities with enthusiasm and caution. While these technologies offer significant benefits, they also come with unique challenges and prerequisites. A holistic evaluation must include technical aspects and business, ethical and strategic considerations. Other areas of focus include risk awareness, critical infrastructure, organizational readiness, governance and compliance and a long-term perspective on the sustainability and scalability of AI approaches.

ISG believes a methodical approach is essential to maximize competitiveness. It is critical to select the right software provider and product to improve the performance of your enterprise’s people, process, information and technology components.

The ISG Buyers Guide for FinOps is designed to provide a 360-degree view of a software provider’s ability to optimize the delivery, performance and governance of cloud-powered IT services within an enterprise. Separate Buyers Guide research reports are available for IT Operations Management, ITSM, AIOps and Observability software.

This FinOps Buyers Guide evaluates products based on capabilities including identifying and decommissioning underutilized cloud resources, identifying cost-saving opportunities and making recommendations, visualizing cloud costs and usage, integrating with cloud cost management and financial tools, enabling collaboration between IT and finance teams, managing chargeback or showback models, budgeting and forecasting cloud expenditures based on historical usage, real-time monitoring and alerts for spending anomalies, supporting tagging and cost allocation, offering key performance indicator measurements, ensuring regulatory compliance and governance, handling multi-cloud environments, including training resources for FinOps best practices, achieving certifications for standards and industry trade associations, and investments in FinOps capabilities. To be included in this Buyers Guide, software providers must meet or exceed the inclusion criteria and have commercially available FinOps products.

The insights gained from understanding current FinOps software providers are invaluable for IT leaders who aim to align technology investments with organizational goals, optimize workflows and foster a culture of innovation. By investing in the right tools, CIOs can unlock new avenues for growth and transformation, paving the way for enterprises to thrive.

This Buyers Guide report evaluates the following software providers that offer products addressing key elements for FinOps: Apptio, Broadcom, Datadog, Flexera, Google Cloud, Harness, HCLSoftware, Microsoft, Nutanix, OpenText, Oracle and Zoho.

Buyers Guide Overview

For over two decades, ISG Research has conducted market research in a spectrum of areas across business applications, tools and technologies. We have designed the Buyers Guide to provide a balanced perspective of software providers and products that is rooted in an understanding of the business requirements in any enterprise. Utilization of our research methodology and decades of experience enables our Buyers Guide to be an effective method to assess and select software providers and products. The findings of this research undertaking contribute to our comprehensive approach to rating software providers in a manner that is based on the assessments completed by an enterprise.

ISG Research has designed the Buyers Guide to provide a balanced perspective of software providers and products that is rooted in an understanding of business requirements in any enterprise.

The ISG Buyers Guide™ for FinOps is the distillation of over a year of market and product research efforts. It is an assessment of how well software providers’ offerings address enterprises’ requirements for FinOps software. The index is structured to support a request for information (RFI) that could be used in the request for proposal (RFP) process by incorporating all criteria needed to evaluate, select, utilize and maintain relationships with software providers. An effective product and customer experience with a provider can ensure the best long-term relationship and value achieved from a resource and financial investment.

In this Buyers Guide, ISG Research evaluates the software in seven key categories that are weighted to reflect buyers’ needs based on our expertise and research. Five are product-experience related: Adaptability, Capability, Manageability, Reliability, and Usability. In addition, we consider two customer-experience categories: Validation, and Total Cost of Ownership/Return on Investment (TCO/ROI). To assess functionality, one of the components of Capability, we applied the ISG Research Value Index methodology and blueprint, which links the personas and processes for AIOps to an enterprise’s requirements.

The structure of the research reflects our understanding that the effective evaluation of software providers and products involves far more than just examining product features, potential revenue or customers generated from a provider’s marketing and sales efforts. We believe it is important to take a comprehensive, research-based approach, since making the wrong choice of AIOps technology can raise the total cost of ownership, lower the return on investment and hamper an enterprise’s ability to reach its full performance potential. In addition, this approach can reduce the project’s development and deployment time and eliminate the risk of relying on a short list of software providers that does not represent a best fit for your enterprise.

ISG Research believes that an objective review of software providers and products is a critical business strategy for the adoption and implementation of AIOps software and applications. An enterprise’s review should include a thorough analysis of both what is possible and what is relevant. We urge enterprises to do a thorough job of evaluating AIOps systems and tools and offer this Buyers Guide as both the results of our in-depth analysis of these providers and as an evaluation methodology.

How To Use This Buyers Guide

Evaluating Software Providers: The Process

We recommend using the Buyers Guide to assess and evaluate new or existing software providers for your enterprise. The market research can be used as an evaluation framework to establish a formal request for information from providers on products and customer experience and will shorten the cycle time when creating an RFI. The steps listed below provide a process that can facilitate best possible outcomes.

1. Define the business case and goals.
   Define the mission and business case for investment and the expected outcomes from your organizational and technology efforts. 
2. Specify the business needs.
   Defining the business requirements helps identify what specific capabilities are required with respect to people, processes, information and technology.
3. Assess the required roles and responsibilities.
   Identify the individuals required for success at every level of the organization from executives to front line workers and determine the needs of each. 
4. Outline the project’s critical path.
   What needs to be done, in what order and who will do it? This outline should make clear the prior dependencies at each step of the project plan. 
5. Ascertain the technology approach.
   Determine the business and technology approach that most closely aligns to your organization’s requirements. 
6. Establish technology vendor evaluation criteria.
Utilize the product experience: Adaptability, Capability, Manageability, Reliability and Usability, and the customer experience in TCO/ROI and Validation. 
7. Evaluate and select the technology properly.
Weight the categories in the technology evaluation criteria to reflect your organization’s priorities to determine the short list of vendors and products.
8. Establish the business initiative team to start the project.
Identify who will lead the project and the members of the team needed to plan and execute it with timelines, priorities and resources. 

The Findings

All of the products we evaluated are feature-rich, but not all the capabilities offered by a software provider are equally valuable to types of workers or support everything needed to manage products on a continuous basis. Moreover, the existence of too many capabilities may be a negative factor for an enterprise if it introduces unnecessary complexity. Nonetheless, you may decide that a larger number of features in the product is a plus, especially if some of them match your enterprise’s established practices or support an initiative that is driving the purchase of new software.

Factors beyond features and functions or software provider assessments may become a deciding factor. For example, an enterprise may face budget constraints such that the TCO evaluation can tip the balance to one provider or another. This is where the Value Index methodology and the appropriate category weighting can be applied to determine the best fit of software providers and products to your specific needs.

Overall Scoring of Software Providers Across Categories

The research finds Datadog atop the list, followed by Flexera and Broadcom. Providers that place in the top three of a category earn the designation of Leader. Datadog and Broadcom have done so in five categories, Oracle in four, Flexera in three, Apptio and Google Cloud in two and Nutanix in one category.

The overall representation of the research below places the rating of the Product Experience and Customer Experience on the x and y axes, respectively, to provide a visual representation and classification of the software providers. Those providers whose Product Experience have a higher weighted performance to the axis in aggregate of the five product categories place farther to the right, while the performance and weighting for the two Customer Experience categories determines placement on the vertical axis. In short, software providers that place closer to the upper-right on this chart performed better than those closer to the lower-left.

The research places software providers into one of four overall categories: Assurance, Exemplary, Merit or Innovative. This representation classifies providers’ overall weighted performance.

Exemplary: The categorization and placement of software providers in Exemplary (upper right) represent those that performed the best in meeting the overall Product and Customer Experience requirements. The providers rated Exemplary are: Broadcom, Microsoft and Nutanix.

Innovative: The categorization and placement of software providers in Innovative (lower right) represent those that performed the best in meeting the overall Product Experience requirements but did not achieve the highest levels of requirements in Customer Experience. The providers rated Innovative are: Datadog, Flexera and Zoho.

Assurance: The categorization and placement of software providers in Assurance (upper left) represent those that achieved the highest levels in the overall Customer Experience requirements but did not achieve the highest levels of Product Experience. The providers rated Assurance are: Apptio, Google Cloud and Oracle.

Merit: The categorization of software providers in Merit (lower left) represents those that did not exceed the median of performance in Customer or Product Experience or surpass the threshold for the other three categories. The providers rated Merit are: Harness, HCLSoftware and OpenText.

We warn that close provider placement proximity should not be taken to imply that the packages evaluated are functionally identical or equally well suited for use by every enterprise or for a specific process. Although there is a high degree of commonality in how enterprises handle FinOps, there are many idiosyncrasies and differences in how they do these functions that can make one software provider’s offering a better fit than another’s for a particular enterprise’s needs.

We advise enterprises to assess and evaluate software providers based on organizational requirements and use this research as a supplement to internal evaluation of a provider and products.

Product Experience

The process of researching products to address an enterprise’s needs should be comprehensive. Our Value Index methodology examines Product Experience and how it aligns with an enterprise’s life cycle of onboarding, configuration, operations, usage and maintenance. Too often, software providers are not evaluated for the entirety of the product; instead, they are evaluated on market execution and vision of the future, which are flawed since they do not represent an enterprise’s requirements but how the provider operates. As more software providers orient to a complete product experience, evaluations will be more robust.

The research results in Product Experience are ranked at 80%, or four-fifths, of the overall rating using the specific underlying weighted category performance. Importance was placed on the categories as follows: Adaptability (10%), Capability (35%), and Manageability (15%), Reliability (10%) and Usability (10%). This weighting impacted the resulting overall ratings in this research. Datadog, Flexera and Broadcom were designated Product Experience Leaders.

Customer Experience

The importance of a customer relationship with a software provider is essential to the actual success of the products and technology. The advancement of the Customer Experience and the entire life cycle an enterprise has with its software provider is critical for ensuring satisfaction in working with that provider. Technology providers that have chief customer officers are more likely to have greater investments in the customer relationship and focus more on their success. These leaders also need to take responsibility for ensuring this commitment is made abundantly clear on the website and in the buying process and customer journey.

The research results in Customer Experience are ranked at 20%, or one-fifth, using the specific underlying weighted category performance as it relates to the framework of commitment and value to the software provider-customer relationship. The two evaluation categories are TCO/ROI (10%) and Validation (10%), which are weighted to represent their importance to the overall research.

The software providers that evaluated the highest overall in the aggregated and weighted Customer Experience categories are Google Cloud, Apptio and Broadcom. These category leaders best communicate commitment and dedication to customer needs.

Software providers that did not perform well in this category were unable to provide sufficient customer case studies to demonstrate success or articulate their commitment to customer experience and an enterprise’s journey. The selection of a software provider means a continuous investment by the enterprise, so a holistic evaluation must include examination of how they support their customer experience.

Appendix: Software Provider Inclusion

For inclusion in the ISG Buyers Guide™ for FinOps in 2025, a software provider must be in good standing financially and ethically, have at least $40 million in annual or projected revenue verified using independent sources, sell products and provide support on at least two continents and have at least 100 full-time employees. The principal source of the relevant business unit’s revenue must be software-related, and there must have been at least one major software release in the past 12 months.

The research is designed to be independent of the specifics of software provider packaging and pricing. To represent the real-world environment in which businesses operate, we include providers that offer suites or packages of products that may include relevant individual modules or applications. If a software provider is actively marketing, selling and developing a product for the general market and it is reflected on the provider’s website that the product is within the scope of the research, that provider is automatically evaluated for inclusion.

All software providers that offer relevant FinOps products and meet the inclusion requirements were invited to participate in the evaluation process at no cost to them.

Software providers that meet our inclusion criteria but did not completely participate in our Buyers Guide were assessed solely on publicly available information. As this could have a significant impact on classification and ratings, we recommend additional scrutiny when evaluating those providers.

Products Evaluated

Providers of Promise

We did not include software providers that, as a result of our research and analysis, did not satisfy the criteria for inclusion in this Buyers Guide. Providers that offer a suite of FinOps-related tools instead of a single application have been excluded. These are listed below as “Providers of Promise.”