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Adapt or Die: The Leap of Faith Moment

Oct 21, 2016

At the San Francisco stop of our Adapt or Die World Tour in September, our customers and partners shared a wealth of experience and know-how on how organizations adapt to digital.

At Adapt or Die New York last week, I was struck by some nuggets of wisdom about what might stand in the way.

Joe Trelin, who joined Clear to build new lines of business powered by an open biometric identity management API, put it succinctly: “At some point, the board of directors at every non-software company has to reach a ‘leap of faith’ moment.”

That’s because no amount of market research and internal debate can deliver absolute certainty about how a move into the digital ecosystem game will play out.

App store speed

The reasons are twofold. First, the market context is changing rapidly. Smartphones and app stores are less than ten years old, and we’re already breaking new ground in how people use digital to interact and do business.  

In barely more than a year, developers added 3,000 skills to Amazon’s Alexa (a “skill” is the ability to do anything from getting a price quote on a flight to controlling your thermostat using only your voice). In even less time, developers built 30,000 bots on top of Facebook Messenger, enabling its billion users to get information or make purchases without ever leaving the app.

Value creation versus value capture

Second—and more importantly—in a rapidly changing digital ecosystem, “getting in the game” with APIs is itself a powerful way to detect opportunities.

Boards and management need to champion taking action for the sake of learning; it should become a core competency of a software-driven business.

Pitney Bowes has built digital products and services into a $1 billion annual revenue stream not by having everything figured out from day one, but rather by embracing this principle.

As the company’s executive vice president of technology James Fairweather explained, “When we initially offer something, we look and see if anyone is paying attention—how it’s being used and if there are any especially interesting uses.”

Pitney Bowes take a strategic view of the difference between “value creation” and “value capture.” The beauty of APIs is that they give you the flexibility to be very open and liberal about enabling your own employees, close partners, external developers (or all three) to use them to create value—while watching and learning how best to capture value for your own organization.

The answer might be surprising.

The answer might change over time.

And there might be more than one answer.

The API portfolio mindset

Google Maps APIs are a case in point of direct, indirect, and use-case based value capture.

You can embed a map—that may include on-map advertising—into a public website at no cost whatsoever.

You can use the Google Maps API in public apps with a standard plan that provides certain uses and quotas for free, with per-use charges beyond those—except if you’re using Google Maps APIs for asset tracking, where you must use a premium plan.

And for private apps, the standard plan is available for those built on Google’s Android operating system—while apps built for others must use premium.

That kind of portfolio thinking about APIs isn’t just for the Googles and Ubers of the world anymore.

The good news is that in city after city, Apigee customers have been incredibly generous in sharing how they’ve made it happen in their organizations. I encourage you to take advantage of the opportunity coming up on Nov. 17 in Chicago to learn from Walgreens, Allstate, Humana, and many more. Two cities in to the Adapt or Die World Tour, I am confident I will.

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