April 26, 2017
Application programming interfaces (APIs) never used to be synonymous with business strategy. While APIs were useful for programmers when integrating business applications together, they had minimal value beyond that.
But this philosophy is changing, especially as consumers turn more and more to digital. APIs remain at the forefront of programmers’ minds but they are also an increasingly important part of any business strategy. Imagine building a business from scratch starting right now. With the technologies available in our digitally oriented world, would it be difficult to incorporate APIs into your business strategy? Not in the least. In fact, it would be a no-brainer. Making business interactions API-driven would automatically be a top consideration given the buzz around the API economy, cloud, etc.
However, our recent study, Executing Digital Transformation, found that technology is a primary area of struggle for most businesses, despite its ability to dramatically improve both internal operations and external relationships. Eighty-one percent of respondents are currently unsatisfied with one or more of the systems their organization relies on, and 22 percent must use five or more technologies to gain a holistic view or their organization’s users. In addition to other technology deficiencies, maintaining systems that struggle to work together results in an overly complicated digital environment and a poor user experience.
Building systems with an API-driven approach that have clear separations of concern provides businesses with the foundation to make employees’ lives easier and to please modern, omnichannel consumers. Particularly considering the many touchpoints available between business and consumers today, designing interactions to be API-driven opens business to benefits including:
Flexibility and automation
When business strategies are API-driven, the user experience or user interface is completely decoupled from a company’s core system (and vice versa). This separation enables the experience to be fully independent, which in turn allows team members to create and update it at its own cadence. Rather than requiring major overhauls, this technological divide ensures businesses can address user experience needs faster and with more adeptness.
Moreover, with a core system designed to be API driven, businesses can leverage the same information across different user interfaces, creating a consistent end-user experience across all digital touchpoints. For businesses that have yet to master omnichannel experiences, moving toward an API-driven strategy is a great stepping stone to simultaneously managing interaction points like web, mobile, Zero UI and more.
Finally, APIs facilitate automation of manual workflows. Compared with legacy systems that are controlled by a single interface, API-driven solutions are better equipped to handle the diverse needs of today’s digital organizations.
Single point of integration across disparate systems
The end goal may be to move away from legacy systems completely, but, with 84 percent of organizations still relying on disparate legacy systems, updates will not happen overnight. In the meantime, putting an API and integration layer in front of legacy systems can help businesses easily perform important tasks like optimization, aggregation and mediation. Enabling callers of the API to leverage disparate system means that businesses can make greater use of their existing IT investments.
New business opportunities
As a bonus, an API-driven approach can actually lead to new revenue channels for businesses. Exposing products and/or services to other businesses or business partners via APIs uncovers opportunities not easily possible with “closed systems” or non-API driven systems. We’re seeing this more often with popular companies like Twitter, Facebook and Uber.
Unfortunately, one in four organizations find it difficult or very difficult for third party partners or service providers to integrate with their existing systems. Not only does the quality of the end-user experience suffer due to deficiencies that third-party integrations could fill but these organizations also miss out on future business opportunities.
Integrated systems and scalable architectures will become commonplace moving forward, especially as stakeholders revisit APIs outside of the realm of programming. Technology is just one part of a successful digital transformation, but making the right technology investments now lays the foundation for digital organizations to succeed holistically in the long term.
Have questions about how your company could benefit from an API-driven business strategy? Download the full Executing Digital Transformation study to learn more.