After months of budget cuts and slashed funding, public sector organizations are up against intense pressure to deliver stable services while working within increasingly constrained budgets. As a result, organizations must develop more strategic approaches to cloud spend management that maintain operational efficiency without compromising performance.
As a framework for bringing financial accountability to cloud usage, FinOps provides a solution. It empowers technical and finance teams to make data-driven decisions, improve forecast accuracy, and align cloud spend with organizational priorities.
In 2025, three FinOps trends are reshaping how the public sector approaches technology spending challenges, including:
- Increased focus on FinOps practices
- Shifting from cloud to cloud+
- An emphasis on flexibility and agility
Below, we’ll explore each trend and offer practical steps IT leaders can implement to enhance cost visibility, optimize resources, and strengthen their long-term cloud strategy.
1. Increased focus on FinOps practices
At its core, FinOps promotes collaboration between IT, finance, and engineering teams to manage cloud spend strategically. In fact, FinOps adoption is expanding throughout the public sector as organizations seek enhanced visibility, accountability, and control over their multi-cloud environments.
It follows that IT leaders should take advantage of the powerful FinOps tools and processes that align cloud spend with business goals and departmental budgets. The result will be better budget planning, reduced waste, and more efficient use of taxpayer dollars.
Actions to take:
- Develop a cross-functional FinOps team that unites IT, Finance, and Engineering around shared performance metrics and objectives
- Establish foundational FinOps practices including detailed cost allocation, structured budgeting, accurate forecasting, and performance tracking
- Deploy a FinOps platform that delivers visibility into cloud usage and spending patterns and generates actionable recommendations for continuous optimization
This week at FinOps X, the CIA presented a breakout session on maximizing cloud cost efficiency. They shared their journey with FinOps and emphasized how important it is to build partnerships across the agency. Additionally, they highlighted their internal FinOps gamification efforts and how they have a leaderboard to track their optimization campaign. Stay tuned for a recording of the session to be published by the FinOps Foundation.
2. The shift from cloud to cloud+
The way public sector entities manage technology investments is evolving. More and more, organizations are adopting cloud+ management strategies that combine public cloud, on-premises infrastructure, and growing SaaS portfolios. While beneficial for aligning workloads to the most cost-effective and compliant environments, this shift adds complexity to how cloud costs are tracked and optimized.
Actions to take:
- Develop a unified strategy that considers the unique characteristics of each FinOps Scope, like Public Cloud, Software-as-a-Service (SaaS), and Data Center
- Look for FinOps tools that offer cloud+ capabilities
- Prioritize workload optimization and waste elimination efforts that don’t compromise budget or service delivery
According to the State of FinOps 2025 report, the definition of FinOps is expanding beyond traditional boundaries (as shown below).
3. Emphasis on flexibility and agility
Public sector teams are increasingly prioritizing flexibility in cloud resource management. With unpredictable funding cycles, fluctuating workloads, and varied migration timelines, organizations need agility to avoid overspend while providing uninterrupted services.
IT leaders should seek tools and pricing models that allow for rapid adjustments as organizational needs or industry requirements change.
Actions to take:
- Adopt cloud services and leverage discount models that allow for savings, like commitment-based discounts
- Review cloud resource utilization and spending patterns regularly to identify trends and opportunities for rightsizing
- Implement lights-on/lights-off policies for non-production workloads to start improving cost efficiency
Staying ahead of the curve in public sector FinOps
The trends shaping FinOps in 2025—including increased FinOps adoption, shifting to cloud+, and an emphasis on flexibility and agility—reflect a response to unprecedented public sector funding changes and the ways affected organizations must cope and adapt.
By embracing these trends, IT leaders can implement more proactive, data-informed approaches to budgeting and optimization and benefit from better cost control, resource optimization, accountability, and resilience to changing priorities.
Explore how Ternary can support your cloud+ strategy and drive smarter, more sustainable financial performance.
