• Alexandre Airvault

Internal API monetization and cost accounting

Mis à jour : janv 22



CONTEXT


APIs are created by many departments for their own needs and when they solve a transversal problem to an organization, they are reused by other departments. Sometimes, dedicated teams are creating APIs. However, if APIs are reused by other departments it means that some maintenance is needed and requires to set up a budget for this purpose. Capturing the value provided by internal APIs is a mandatory task so API creators can continue maintain those APIs for their colleagues and create new ones. We see quite often that the value is calculated as cost avoidance for other departments. This cost avoidance through can be then assessed and negotiated potentially as a budget for maintaining APIs or create new ones and experiment. Having the ability to recharge between departments the cost of usage of the APIs is the great way to infuse and monitor the performance of the work put into APIs. It is a fundamental brick of the digital transformation.



PROBLEM


However, in real life, estimation of cost avoidance is not easy and often happens at budget time with a bulk estimation. It is hard to agree on one cost transfer from one department to another one. API owners find themselves frustrated that the value they provide is not fully recognized or they did not get full support from management. This simply slows down the digital transformation of a company and reduces the means and velocity of the department creating APIs.



HOW WE SOLVE IT


We built the solution for API product managers/owners so they can independently create API subsets of the API that we call API products. They have the full flexibility to define those API products through a graphical interface determining which endpoints, data fields, data values, data result should be included or modified. They can as well add datapoints to the original API easily. It means that the flexibility is back in the hands of the product managers who are the closest persons to internal users to adapt to their needs in minutes. Even if you have one internal API and want to make only some elements (datapoints/endpoints) public within your organization you do not need to ask engineering to rebuild entirely new APIs. With our solution you can split it into subsets to make it available publicly or to specific partners.

In addition, API creators can apply any business model ranging from pay per use, subscription to value-based pricing. Our solution helps them to define the business models for API products and apply it to internal API users and the right cost centers. It provides clarity and clear contract definition when using API products internally.



VALUE PROVIDED


  • Get the right budget for APIs you create

  • Fuel the digital transformation

  • Understand better the internal usage of APIs

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