MSPs: Why DIY for service provisioning, monitoring and billing is not a winning strategy

We recently had an interesting call with a prospect that left us wondering why MSPs pursue building their own revenue-focused cloud management platform in-house.

This prospect was a mid-sized MSP. Our CEO, Alan Zurakowski, found himself on the phone with the MSP’s CEO and head of product development. As Alan reviewed the capabilities of the HyAlto platform, the prospect would periodically interrupt to ask his head of product development, “Will we have that?”

At the end of the conversation, we wished the prospect well and promised to touch back in a year to see how that DIY platform had worked out, how scaleable it had proven to be and how the maintenance costs were adding up.

It’s fair to assume that frustration is driving, at least in part, an MSP’s decision to invest the resources in a DIY build. It’s old news now that a majority of enterprises are increasingly multi-cloud – they want the convenience and freedom of being able to pick, choose and swap from among various cloud service providers to find the best combination of services, capability and flexibility to get the job done, as cost-effectively as possible. By the same token, they want “one throat to choke” – work with a single MSP that has the integrations with a variety of cloud providers to deliver this kind of flexibility, with one bill at month end.

This leaves MSPs scrambling to figure out how to provision, accurately monitor usage and efficiently bill for a buffet of cloud services. The issue in the industry has long been the lack of a truly viable “universal remote” or “single pane of glass” which they can procure from a third party to address these business challenges.

So they try to build their own. And when HyAlto comes along with a purpose-built platform, these MSPs are reluctant to backtrack from the DIY route they have already undertaken, perhaps suspicious that HyAlto can deliver the goods as promised.

Fair enough. We fully expect to have to prove ourselves. But an MSP in this situation has to ask itself a few tough questions:

  • What impact is this in-house development having on our financial resources, technical resources and ability to spend billable hours on the clock with clients?
  • How scaleable will it be to serve as the foundation for a multi-cloud growth strategy? (Because there’s no denying that a majority of our clients are moving in this direction.)
  • How much will it cost to maintain?
  • Does our in-house build have the automation tools to drive more accurate and timely billing and usage monitoring?
  • Will it have a client-facing portal, so that our customers can have greater control and real-time insight into their cloud usage and provisioning? (If a customer doesn’t want this now, it will tomorrow.)

Martin Banks touched broadly on the issue in a recent article on Diginomica, Cloud services shouldn’t involve “building your own car”:

“There is no reason now for the vast majority of businesses to want to stay in the land of ‘cloud DIY’ – that is like buying self-assembly cars where the main pleasure is the cussed delight in the building process. Most people buy cars to get from A-to-B with the level of reliability and comfort they consider appropriate. With the range of cloud service options available these days it is the same for users.”

We couldn’t agree more.

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