TL;DR
- Showback exposes cloud and infrastructure costs to the teams that incurred them — typically as a dashboard or report — without moving money internally.
- Chargeback goes one step further: the cost is recharged to the consuming team's budget through internal accounting entries, making it a real P&L line.
- Most organisations start with showback to build awareness, then move to chargeback once allocation accuracy is high enough to defend internal recharge.
- Both models depend on robust cost-allocation tagging; without it, neither showback nor chargeback can be done credibly.
Definitions
Showback and chargeback are two points on the same spectrum: cost allocation. Both answer the question 'who consumed this?' What differs is whether the answer is informational or financial.
- Showback — costs are attributed to consuming teams and reported back to them, but the budget remains central. The team sees what they spent; central IT or finance still pays.
- Chargeback — costs are journalled from the central account into the consuming team's cost centre, becoming part of that team's P&L.
When Each Is Right
| Stage | Model | Why |
|---|---|---|
| Early FinOps practice | Showback | Tagging is incomplete; visibility itself drives most of the behaviour change. |
| Mature FinOps practice | Chargeback | Allocation accuracy is defensible; finance demands real budget accountability. |
| Shared platform (e.g. internal Kubernetes) | Showback or partial chargeback | Shared overhead is hard to allocate at line-item level; pool unattributable costs. |
| Multi-tenant SaaS product | Chargeback | Customer cost is part of unit economics; needs to flow into the product P&L. |
What You Need Before You Can Do Either
Both models require the same foundational data plumbing. The difference is only in what you do with the output.
- Consistent cost-allocation tags applied across every resource — typically cost-centre, team, env, project, application.
- An allocation rule for untagged costs — usually proportional distribution or assignment to a 'shared' bucket.
- Treatment for shared services — internal platforms, central observability, shared egress. Either flat-rate cross-charged or proportionally distributed.
- Treatment for commitments — Reserved Instance and Savings Plan discounts should be amortised fairly across consumers, not concentrated in whichever account holds them.
- An agreed cadence — typically monthly close, with daily showback dashboards for in-flight visibility.
Common Failure Modes
Cost-allocation programmes fail more often through process than through tooling. The recurring failure patterns are well known.
- Tag drift — tagging policy exists on paper but is not enforced at resource creation. Allocation accuracy collapses.
- Surprise chargeback — finance moves from showback to chargeback without giving teams notice, time to react, or means to optimise.
- Shared-services arguments — teams dispute the allocation of central platform costs because the model was never agreed.
- Commitment hoarding — central IT keeps all RI/SP discounts and recharges teams at list price, making the central function look efficient at the teams' expense.
Warning: Chargeback without trust is worse than showback. If teams do not believe the numbers, they will spend more time arguing the bill than optimising the workload.
Implementation Pattern
A typical journey across an 18-month FinOps maturity arc looks like the following. The point of the staged approach is to build trust in the numbers before they become real money.
- Month 0-3 — establish tagging policy, instrument FOCUS-conformant billing ingestion, build a single source of truth.
- Month 3-6 — launch showback dashboards per team, with month-over-month trend and forecast.
- Month 6-12 — agree allocation rules for shared services and commitment discounts. Publish a chargeback methodology document.
- Month 12-18 — switch to chargeback for top-level cost centres, keeping showback in parallel for finer-grained workloads.
On Yobitel
Yobitel exposes FOCUS-conformant cost data through Yobibyte's billing API, which makes both showback and chargeback straightforward for customers running multi-team workloads on Yobitel capacity. Tags applied at workload creation propagate through to the billing record, so cost-centre and project attribution requires no separate enrichment pipeline.