How CTOs can build a resilient cloud budget cycle and optimize COGS with confidence

Budget season is approaching, and organizations are gearing up for the annual challenge: forecasting next year’s technology costs. On the Finance side, there’s pressure to produce accurate, defensible forecasts aligned with business goals. For technology and engineering leaders, the reality is less clean-cut: scattered data, growth projections that can feel like guesswork, and the sting of overages from last year. The struggle to bring structure and confidence to technology budgeting is a common one, especially when ownership is split across Finance, FinOps, and Engineering. 

This article’s goal is to empower Finance, FinOps, and Technology leaders to work together to navigate budget uncertainty with confidence. Whether you handle this process internally or enlist external support, the goals are clear: 

• Analyze cost data, test assumptions, and solidify forecasts to minimize surprises.
• Enforce ownership and accountability with the right P&L holders.
• Strengthen Finance-FinOps-Engineering collaboration to align spend decisions with business goals.   
   

Budgeting approaches by FinOps maturity

The path to effective technology budgeting hinges on your FinOps maturity, often framed by the FinOps Foundation's Crawl, Walk, Run model. 

Each stage in this model represents a level of maturity that organizations can progress toward. 

• Crawl: Organizations at this stage often lack consolidated data, relying on manual spreadsheets for basic visibility. Internal teams might struggle with siloed insights, while external support can help accelerate setup by providing tools and benchmarks.
• Walk: As maturity advances, proactive analysis emerges, with some automation for forecasting.
• Run: This stage features real-time dashboards and cross-functional governance.

“What good looks like” in Figure 1 defines the target state for each stage – the outcomes and practices your teams should aim to achieve to move to the next level.
 

Proper allocation ensures R&D supports long-term investment, COR reflects revenue efficiency, and OpEx aligns with operations, setting guardrails for volatile growth. FP&A and Engineering teams should work together to balance these to optimize financial storytelling, ensuring cost allocations align with strategic goals and bolster market confidence. A collaboration model we see working well involves Finance defining the categories and accounting treatment, while Engineering provides the tagging, usage, and environment data to enable correct classification.

While these frameworks strengthen long-term budgeting discipline, many teams also face immediate pressures: tight timelines, limited visibility, and the need to submit credible numbers fast. In those situations, focusing on short-term, high-impact actions can stabilize forecasts and create momentum for deeper improvements.