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The Why and How of APIs: The Open API Model

Brian Mulloy
Aug 14, 2014

In previous posts, we delved into internal and partner API initiatives and explored how and why these programs are great first steps on the road to digital transformation.

Having developed internal and partner projects, the API team will have built institutional knowledge and confidence for opening the API to the world of innovative developers, who can take the API in creative, valuable directions for the business.

Innovation, of course, is fostered wherever APIs are available, be it inside the company, among partners, or “in the wild.”

Open APIs, because they are accessible to developers outside of your business, can attract new and often unexpected innovation by enabling your core business service to be “remixed” by others outside of your company. Open APIs are documented, available via self-service (developers can sign up and get a key on a website), and employ open technologies.

Additionally, the burden of being an expert in the hundreds of different platforms and devices out there is shifted away from your enterprise and onto developers. Perhaps more importantly, many businesses have found tremendous advantage in opening up their data to innovative developers outside of their companies and enabling them to create new experiences for customers.

An open API enables the gathering of important data about how developers build on an API; this helps an organization create a differentiated experience that attracts more developers.

Benefits of open APIs

Breakthrough innovation:  The most common of all use cases, and a well-known paradigm given the success of companies like Twitter, Foursquare, or Facebook, this is the case for innovation by leveraging the creativity and know-how of hundreds of thousands of developers around the world using your API to create cool apps and make big breakthroughs.

Niche markets: A company may have a geographical or demographic niche that represents a nice new value proposition for the business. But it may not have the resources or the budget to get the value proposition into those niches. Taking advantage of an open API program, any developer can create an app that generates new value for both themselves and the API provider.

Direct incentives: A directed approach may be to run a contest or a hackathon and an incentive to build against your API. The automotive industry, for example, has successfully used this approach to solve problems. It extends R&D budgets and resources beyond the borders of your business and spurs innovation on a broad scale.

Choosing the right API program for you

Many successful enterprise API initiatives start with internal models, expand to partner APIs, and then possibly to open APIs, with each stage building on its predecessor.

Yet there are no absolutes. Generally, when you know you need an API, you’ll start where the business drivers are, or where you have the most trouble. You could ask: “How or where could APIs help us achieve our key business objectives?”

An API program might be internal, if you are meeting a demand for mobile and social apps within your enterprise. Perhaps, if you need to innovate with partners to deliver on a backlog of business development opportunities, a partner strategy is the way to go. An open API is the right path if you wish to inspire a broad community of app developers to innovate and create growth opportunities for your business.

Getting the right mix of API program scenarios can push an enterprise toward becoming a robust platform for innovation, enabling it to compete in a world of new expectations and compelling opportunities, speeding it on its way to digital transformation.


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