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API: Is it Now Essential for Growth?

by Mohcine Aterhzaz
02/2023
in Tech and Digital
Gourmet natural honey in honeycomb

API development is moving at a faster rate than ever. This pace is influenced by a range of challenges that can impact an organisation’s ability to deliver reliable and efficient software to its partners, collaborators and customers. According to Mohcine ATERHZAZ, API Leader at Wemanity, companies must think about working with an ecosystem to invent new use cases and new business models. Check out all these new API solutions that will keep you in the game!

1. APIs, Products to Open Up Ecosystems and Invent New Business Models

An API, what is it?

An API, it is an interface that is clearly delimited and that will allow applications to communicate with each other in an efficient and secure way. It is also documented, contractual, supervised and secure. It can allow others to cannibalise you, to use your logic and by doing so: making you grow. 

Often defined as a technical asset of a company, it is above all a lever. Here, we will focus on its business aspect, that is to say API as a product. This is the same technical interface, but based on a business model and driven by growth objectives.

Discover our value proposition

An API product, what is it?

Today, we are focusing on Product APIs because APIs have become crucially important in the world of business and in the digital economy. They have evolved into products in their own right that can be sold and bought, just like any other products or services.

Indeed, APIs allow companies to make their data and functionalities available to other companies or developers, which can lead to new opportunities for collaboration and growth for both parties involved in the process. By strategically using APIs, businesses can expand their reach and impact to create new revenue streams.

APIs can be used to improve the efficiency and speed of developments also by allowing organisations to relentlessly focus on the topics that bring value rather than spending time squaring circles.

Examples of API applications

Take a car insurance company, for example. By using weather APIs it can set up an automated real-time notification system to warn its customers in the event of a storm. This can help the company minimise damage and properly provision its convenience store fleet. 

Or this insurance company could include its offers during the process of buying a car from another dealership. Which allows buyers to purchase insurance immediately while purchasing their vehicle at a partner store.

APIs make it possible to find new types of applications for any digital product or service; by turning towards the basic logic of sharing. This new perspective benefits the most opportunistic and the most creative of this open market.

2. The Promises Behind API Products

Bringing business and IT together around a common goal

A software development approach based on the notion of API products allows business and IT departments to work together effectively. Together, they will create digital products based on an API and driven by value. According to the different business usages, this coalition can maximise the return on investment. Thus, the API as a product must be a common language for all. The fluidity of the exchanges between the different domains, projects and partners, allows better coordination and greater efficiency in the realisation of projects.

Create new ecosystems

The use of APIs makes it possible to combine offers from different sectors and players to create new products or improved customer experiences. It also facilitates and accelerates the process by integrating additional and essential services such as social login, payment in instalments, GPS, delivery of third parties and insurance. This industrialised approach also reduces Time to Market delays while making it possible to contract interactions with a large number of partners at a reduced cost, whether they are multinationals, SMEs or startups.

In an ecosystem, the use of API products is beneficial for all the actors involved, the suppliers who expose their products and those who consume them.

3. The New Challenges of APIs for Companies

Companies must move fast, always innovate, stay ahead of the competition and not just stay in the heart of their business. They must think about working with an ecosystem of partners to invent new use cases and new business models. To be able to innovate today, a company can no longer just rely on its Information System, but open up and see other facets of the market: partners, sometimes competitors and APIs that will be able to enrich the customer’s experience. This requires the creation of platforms that promote openness and innovation.

According to Mohcine Aterhzaz, “technology” is not the most important issue of the company today, but rather its “philosophy”. The main challenges are innovation and the optimisation of interaction at all levels: internally, with partners and with the outside world. And the API is today a formidable competitive factor for rethinking its ecosystem because an organisation must be flexible in order to better organise itself and meet the demand for speed of the digital economy. So you understand that these issues go far beyond the technical disciplines. APIs are at the heart of the global paradigm shift, and their role is growing in the footsteps of the new digital economy.

API security

Due to the increase in innovations and automation of business processes by APIs, the risk of cyber-attack linked to these new gateways into information systems is on the rise. This is why putting this concern at the heart of your API transformation is a priority. Open Web Application Security Project® (OWASP), a nonprofit foundation dedicated to improving software security, lists the most common API vulnerabilities and security risks. This is a good reference to start with.

The quality of APIs

The quality of the APIs is a vector of income. Their absence is often due to the fact that companies consider them only from a technological angle (hence the importance of exposing APIs). However, it is essential to take into account the aspect of the consumer (and therefore the experience of the developer) who uses them: who are they? What use is it to them? What value is thus created?

Related post:  DevOps Culture in a Siloed Work Environment: What Are the Challenges?

Without considering the uses and experiences of developers, it is difficult to design quality API products. There is therefore a risk that companies, when evaluating their transformation strategy, do not give APIs the strategic importance they deserve, because due to their lack of quality, adoption could be limited and send negative signals.

Within Wemanity, we have implemented a guide to best practices in API Design and a tool for automating the measurement of quality. These two topics will be the subject of a future article on our blog.

API governance and organisational scalability

Designing, developing and exposing APIs are now complex subjects for companies, because adopting an API approach involves bringing together teams from different trades: security, DevOps, development, marketing, communication and partnership. The issue of governance between these stakeholders is therefore major.

This is why basically an organisation must:

  • Ensure the alignment of all players by communicating effectively and educationally on best practices.
  • Make the API management team a central point of exchange for all API discussions.
  • Transmit knowledge to different teams as much as possible.

There are two modes of API governance:

  • Decentralised governance where the API management team makes it easy and efficient for everyone to contribute to projects. This core is there to frame, guide, help and support, but not to define or implement the APIs. This way of managing APIs allows other product line teams to work independently.
  • Centralised governance: this second API management team brings together all the necessary skills and works independently to design and implement APIs.

Here, the challenge is to adapt to the maturity and autonomy of the API actors of the company with a common objective: that of scaling the organisation to follow the speed at which the API Economy evolves.

4. How to Start?

Before embarking on an API program to achieve their strategic goals, companies need to determine how they want to use them. This approach is based on the support of the various internal and external actors in the project and this involves five pillars…

  1. A definition of the API strategy: to bring out the value offer in terms of products.
  2. An IT focus on the design and implementation of APIs: setting up the methodology and tools adapted to each category of stakeholders in the API design and implementation phases.
  3. A focus on operations management: mastering tools, planning technical resources to better manage change.
  4. A focus on the developer experience: communicate, share and forge links with the community to bring them together around the API.
  5. A focus on the organisation: set up roles, define responsibilities and establish the documentary base to support the process and anchor good practices from the first days of the project.

In summary, let us remember that APIs play a crucial role in the connectivity of systems and that this upsets the traditional models already established. This position makes the gains promised by the digital world much more accessible for companies that join the dance. So today, in an environment increasingly focused on platforms that demand increased responsiveness, ignoring the importance of APIs seems inconceivable.

So it’s a big YES to get started with APIs! Discover an unmissable opportunity to get ahead of your competitors and thus become the leader in your market.

Do you need support in setting up a technological or agile project?

Get in touch with our Agile IT experts

In summary:

An API, what is it?

An API is an interface that is clearly delimited and that will allow applications to communicate with each other in an efficient and secure way. These are the same technical interfaces, but based on a business model and growth objectives.

An API product, what is it?

By using APIs strategically, businesses can expand their reach and impact, and create new revenue streams with a fully fledged product that can be sold and bought just like any other product or service.

What are the promises of API products?

The use of APIs brings business and IT together around a common goal and creates new ecosystems with better coordination and greater efficiency in carrying out projects.

What are the new challenges of APIs for companies?

Companies must think about working with an ecosystem of partners to invent new use cases and new business models in order to remain or become the leaders of their market, but technology is not the most important issue, it would rather be the philosophy of the company.

What precaution should be taken with APIs?

Due to the increase in innovations and automation of business processes by APIs, the risk of cyber-attack linked to these new gateways into information systems is on the rise.

What are the types of API governance?

There are two modes of API governance: decentralised governance and centralised governance. In the first, the API management team allows everyone to contribute, but does not define and implement the APIs. In the second, the API management team brings together all the necessary skills and works independently to design and implement APIs.

What is the process for getting started with the API?

You must first define an API strategy, then focus on the design and implementation of APIs, a focus on operations management, on the experience of developers and finally on the organisation.

Mohcine ATERHZAZ

Mohcine ATERHZAZ

API Leader : Helping Organizations to build an API-Driven Strategy and deliver successful API Platfroms.

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