Market Perspectives

ISG Research is happy to share insights gleaned from our latest Buyers Guide, an assessment of how well software providers’ offerings meet buyers’ requirements. The FinOps: ISG Research Buyers Guide is the distillation of a year of market and product research by ISG Research. 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. 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. Enterprises 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. 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. 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. This research-based index evaluates the full business and information technology value of FinOps software offerings. We encourage you to learn more about our Buyers Guide and its effectiveness as a provider selection and RFI/RFP tool. We urge organizations to do a thorough job of evaluating FinOps offerings in this Buyers Guide as both the results of our in-depth analysis of these software providers and as an evaluation methodology. The Buyers Guide can be used to evaluate existing suppliers, plus provides evaluation criteria for new projects. Using it can shorten the cycle time for an RFP and the definition of an RFI. The Buyers Guide for FinOps in 2025 finds Datadog first on the list, followed by Flexera and Broadcom. Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader. The Leaders in Product Experience are: • Datadog. • Flexera. • Broadcom. The Leaders in Customer Experience are: • Google Cloud. • Apptio. • Broadcom. The Leaders across any of the seven categories are: • Datadog and Broadcom, which have achieved this rating in five of the seven categories. • Oracle in four categories. • Flexera in three categories. • Apptio and Google Cloud in two categories. • Nutanix in one category. The overall performance chart provides a visual representation of how providers rate across product and customer experience. Software providers with products scoring higher in a weighted rating of the five product experience categories place farther to the right. The combination of ratings for the two customer experience categories determines their placement on the vertical axis. As a result, providers that place closer to the upper-right are “exemplary” and rated higher than those closer to the lower-left and identified as providers of “merit.” Software providers that excelled at customer experience over product experience have an “assurance” rating, and those excelling instead in product experience have an “innovative” rating. Note that close provider scores should not be taken to imply that the packages evaluated are functionally identical or equally well-suited for use by every enterprise or process. Although there is a high degree of commonality in how organizations handle FinOps, there are many idiosyncrasies and differences that can make one provider’s offering a better fit than another. ISG Research has made every effort to encompass in this Buyers Guide the overall product and customer experience from our FinOps blueprint, which we believe reflects what a well-crafted RFP should contain. Even so, there may be additional areas that affect which software provider and products best fit an enterprise’s particular requirements. Therefore, while this research is complete as it stands, utilizing it in your own organizational context is critical to ensure that products deliver the highest level of support for your projects. You can find more details on our community as well as on our expertise in the research for this Buyers Guide.

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