What are the basics of an API strategy ?

What are the basics of an API strategy ?

API : Application Programming Interface

Per WIkipedia: " In computer programming, an Application Programming Interface is a set of subroutine definitions, protocols, and tools for building application software"

But what does it actually mean for the end user ?

APIs make it easier to integrate and connect people, places, systems, data, services and algorithms.  They ;

  • Create new user experiences
  • Share data and information
  • Authenticate people and services
  • Enable transactions
  • Leverage third-party algorithms
  • Create new services and business models

To summarise: they are fundamental to scaling applications into platforms which increase the value of offerings. This ultimately drives more end-user engagement and adoption 

To explain with an everyday example:

  • You hail a taxi/ cab using a booking app (core service)
  • The booking app uses Google Maps/ Mapbox API to send out a booking query (from point A to point B)
  • The map API connects this booking query with GPS co-ordinates of drivers who are open to taking passengers
  • Driver accepts your booking
  • You pay for the service
  • Your payment is shared between all connected parties

APIs are like glue which connect a SaaS world.

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In an increasingly digital landscape, they have become fundamental to growth (especially for SaaS organisations). This is because digital services are often inter-dependant and no one company can capture and deliver all the niche service offerings that consumers need, for a seamless experience in completing a transaction or an end-to-end service. 

Consecutively, they enable SaaS companies to

  • Analyse their business
  • Expand their distribution of services/ content
  • Multiply user growth
  • Monetize digital assets
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Inferring from above, the fundamental transformation that APIs drive is around converting a business from a point software solution to a platform solution which can be leveraged by multiple businesses (and multiple softwares)

So why are platforms so important ?

The simple answer lies in increasing revenue share.

  • Platforms allow creation of digital business models which enable eco-systems of people, businesses and connected services to create value from an outside-in perspective
  • They thereby open up new lines of revenue
  • They also work on the fundamentals of scale and leverge which makes it easier for businesses to grow
  • Businesses can increase revenue by exposing existing assets like algorithms, data and analytics - ie there is no need for additional work or investment in new assets

It is a win-win situation in most cases.

So how does one start about bringing this strategy to life?

The three fundamental blocks are

  • Adoption of technology that can create APIs from existing business assets like data, algorithm and transactions
  • Investment in API management software which can deploy and manage the platform while maintatining data protection, user information sanctity and enterprise security
  • Transformation of business processes which can scale curation of services from eco-system partners while being ethical, secure, reliable and compliant
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References: Gartner, RapidAPI, Akana Software

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