7 steps to making modern digital ecosystems with APIs
The need for businesses to embrace digital ecosystems both inside and outside their organization is widely understood. A business product that is not exposed by an API cannot easily participate in a digital ecosystem.
APIs make modern digital ecosystems possible.
They solve the problem of information silos by enabling you to create reusable integrations for your applications and data internally. They also enable more efficient customer experiences and more effective partner relationships by letting an organization share relevant data externally. APIs give developers in and outside of your organization a pattern to create products and invoke services that are by their very nature dependent on your business processes, products, and IT systems. This will generate revenue both directly and indirectly.
Typically, an organization will contain both “APIs as a Product” and “Products as APIs”, the former being specially focused on monetization of the API directly and typically making up a small portion of APIs. The creation of an API Catalog, in principle, can be achieved by surveying and listing a group of digital assets and exposing them through an API Portal. However, a key part in the success of a Catalog is alignment with a broader API strategy which is in turn in alignment with a business strategy.
As such, the first steps in the creation of a Catalog is to define and confirm the business goals and products that will be enhanced by the APIs that will be created and cataloged.
Also, a broader API Strategy needs to be put in place to ensure that APIs are used in the design, automation, and testing of business functions. From a technical point of view, an API Catalog needs to support functions such as governance, documentation, discovery, developer onboarding, security, and KPIs. Here are your 7 steps:
1. Define business ecosystems and outcomes
An obvious but sub-optimal approach when defining goals for an API strategy is to start with applications and data and then work backwards from there. More desirable goals would include creating a new revenue channel, driving new business leads or removing IT bottlenecks. As a first step, Business and IT leaders must come together and critically self-assess the core capabilities through which they wish to compete; they must objectively consider their unique advantages that will serve as the source of competitive differentiation.
Business and IT Leadership must also align around a common set of business outcomes that these core capabilities will support, to agree on the quantitative metrics that will define success, and to bring together the right organizational leaders.
A part of this would be a definition of the ecosystem in which the business outcomes will be focused, for example.
A key differentiation for an API is to understand who the API caller is and design and modify the API to meet the needs of the caller. For example, in the above example, a core business product may be exposed to Advertisers, Distributors and Consumers but each caller should have an API designed with them specifically in mind.
2. Align Organization and Culture
APIs represent a paradigm shift in how businesses meet objectives and how IT delivers projects. Ultimately, the people in your organization responsible for driving this shift in thinking will play a much more significant role in the success or failure than any technology implementation considerations.
This is why it’s so important to instill an API-driven culture. It starts from the top — organizations that can obtain and evangelize an executive mandate for the use of APIs will ultimately be much more successful at implementing this type of culture. One need look no further than the now infamous “Bezos Mandate” — where Amazon CEO Jeff Bezos dictated to his internal development teams that “All teams will henceforth expose their data and functionality through service interfaces.”
Because of this, APIs have been a fundamental driver of business model transformation at Amazon over the past 15 years, playing a significant role in their rise to market dominance. This is not to say that CEO level buy-in is required for APIs to succeed, Amazon is an extreme example of an entire enterprise being built around the concept of APIS but for APIs to enjoy true success in an organization, department or project the concept requires support from that group’s leadership.
3. Define KPIs
The establishment of API KPIs allow an organization to track the effectiveness of an API Catalog. This can provide the necessary visibility and ensure that the APIs do not devolve into technically focused cogs that are not aligned to a business strategy.
4. Define the API Lifecycle
A key portion of establishing an API strategy is to define an organization’s API lifecycle that enables the development, use, monitoring, management and measurement of your APIs.
Not all steps need to be in place initially, but the definition of the lifecycle should be made intentionally and should evolve over time:
5. Survey Digital Assets
Once a company’s core IT assets have been identified, they must then be ‘packaged’ so that they can easily be accessed (and monetized) by consumers. Remember that consumers can come in many forms depending on the business ecosystem. The IT assets may be leveraged by multiple parties and packaged and repackaged in different ways, and it is by bringing multiple capabilities together an API driven digital ecosystem starts to emerge.
6. Select underpinning API Catalogue Technology
Taking into account the desired and future API Lifecycle a selection of an API Catalogue technology will be undertaken
7. Populate the API Catalogue and Drive Adoption
It’s best to start with a small API program before publishing a suite of APIs for an entire ecosystem to use. Look for developer communities to consume the APIs that are supportive of the API Strategy. Create an execution plan so you can measure the success of the API project. Experimentation is key in these early stages. You need to see what is and is not working, uncover potential vulnerabilities in your integrations, and identify ways to drive adoption for your API when it goes live.
Mark Janzen is a Practice Area Director for Slalom’s MuleSoft capabilities focused on MuleSoft, API Management, and Systems Integrations.
