Rethinking your API strategy
APIs are key to keeping data moving and processes flowing in the modern enterprise. But implementing APIs effectively means more than plugging in Product A to Product B and hitting go.
To fully unlock the benefits of application programming interfaces, you need a comprehensive API strategy.
So, where do you start, and why is it so important?
What is an API and what are they used for?
API is short for application programming interface. These are software-to-software interfaces. Or, in other words, they’re a nexus that let other programs talk to each other and share functionality.
So, with an API, one computer program can use the abilities of another.
They’re used to deliver information or functionality without user interaction. They facilitate integration between the disparate systems across your tech stack. And this means more efficiency across your business and its various workflows.
Data moves from A to B to C, System 1 triggers actions in System 2, and your whole ecosystem stays in sync despite the glut of different technologies in play.
Read more: ELI5: what is an API?
So, why rethink – or think at all — about setting an API strategy?
Our expectations for effortless digital interactions are growing. With APIs, it’s possible to deliver more value and more functionality to consumers in less time. After all, you can run seamless automations round the clock. And, in turn, this means the potential to offer more services and generate greater user satisfaction.
From a financial perspective, effective use of APIs also stands to reduce your operational and technology costs. Companies can make use of their own APIs to simplify development, meaning fewer resources and money spent.
The rise in efficiency also translates to the opportunity to increase productivity. You need less time to add features to your product – you can just use X product’s API. You don’t need to bounce between programs to manually copy-paste data. In short, you can get more done thanks to APIs.
Unlocking the value of APIs, however, is reliant on having an effective API strategy. That is, knowing how to implement APIs and manage them.
• Identify API opportunities
Before you can unlock the value of APIs, you first need to understand where the best opportunities to apply them lies for your business.
Step one is to identify potential API uses. Step two is to prioritise those opportunities that stand to have the most high-value impact.
It’s worth noting that there’s no need to create something entirely new to enjoy the value of APIs. Rather, the use of an API can allow you to add new functionality to existing services and products.
• Monetisation and resource management
With the valuable API opportunities identified, the next step of a good API strategy is to plan the management of resources and monetisation. This means asking (and answering) questions such as:
- What do you need to implement to capture the value you’ve identified?
You may need to consider any new processes, time set aside for development, or new software programs you want to integrate your systems with.
- What and how will you charge for the use of your API offering?
This means considering the different payment strategies you can use, from pay per use, to freemium, to more complicated arrangements. What you’ll charge, meanwhile, comes from the value of the data involved, and the functionality (and revenue streams) the APIs unlock, for example.
You should also take the time to look at the impact the planned API implementation could have internally. How and where can the APIs help you to save money?
• Get organised
Next in an effective API strategy is organisation — particularly, how you will manage and maintain your new APIs.
A good practice is to create a centralised governance. That is, a team or supervisor specifically in charge of managing API use in the organisation.
This means managing who makes use of the APIs assisting with things like developer access. They will actively identify more API opportunities and decide which APIs should be developed to further benefit the organisation.
They’ll also oversee ensuring that APIs are not duplicated and get reused where possible, and establish security standards for the APIs that are (or will be) put into use.
• Encourage adoption and growth
An effective API strategy also involves a considered approach to the adoption of your new APIs. It’s important to encourage use in a measured way to ensure that the API works as desired, then to ramp up adoption to drive growth.
You can then take the reduced costs and productivity boosts to drive API adoption and scale your product with more functionality, scale your API use, and scale your business.
It’s also key to monitor and manage API performance, and also to remember that API use opens opportunities for more API use.
Rethink your API strategy
APIs allow businesses to collaborate digitally. They allow software programs to share functionality, and they can cut costs.
In short, APIs are instrumental for businesses that want to stay competitive.
And unlocking the value of APIs is reliant on having an effective API strategy. So, when you get started, remember: identify, monetise, organise, and scale.