Startups often face significant challenges. At a bare minimum, they need to define their value proposition, build a service, get funding, define a business model, drive sales, and recruit talent—all with a severely constrained staff. Many startups fail because of their inability to address any number of those challenges.
Companies that win in the digital economy share a common obsession: they're fanatical about delivering first-class digital experiences to their customers and partners.
One such company is T-Mobile. We were fortunate to be joined recently by this leading mobile services provider's vice president of IT Chuck Knostman. Chuck described how T-Mobile’s API-first mindset enables its IT and business teams to operate in lockstep and continuously improve how the company serves customers online and in its retail stores.
Check out this 30-minute video of the conversation between Chuck, Apigee's head of business transformation strategy John Rethans, and IDG's Tom Schmidt.
In this video, you'll also be introduced to Apigee Compass, an online tool that helps companies plan and prioritize their digital transformation journey.
From the nuances of managing microservices to best practices for ecosystem participation to the ways digital disruption has rippled across specific industries, a wide variety of trends and topics has been on the minds of developers, IT architects, and business leaders.
It has given Apigee’s deep bench of “thought leaders” a lot to write about during the past three months. Over the last quarter, we’ve published 16 new columns to help organizations harness their APIs to develop new services faster, improve efficiency, and accelerate their digital transformations.
In case you missed some of them, here’s a look back at the editorials we published in the past quarter.
Digital transformation best practices
Digital Transformation: Necessary vs. Sufficient by Jim Haar in CIO Dive
Digital transformation is a multifaceted challenge. Many technologies are necessary but few if any of them are likely to be sufficient on their own.
When Culture is a Cop-Out by John Rethans in Forbes
Why the tendency to label complex organizational operations as “culture” can be counterproductive.
Your Demand Chain is Dying by Michael Endler in Medium
The ways we buy things and consume services in a world of ubiquitous connectivity, proliferating mobile devices, and agile software experiences are different than the ways we did those things in the analog days.
Avoiding Digital Disaster: The 5 Things You May Be Doing Wrong by Becca Thomas in Medium
A poorly-executed strategy can topple even previously successful companies.
“Digital Transformation” is a Misnomer by Michael Endler in Medium
Digital transformation is neither just about digital nor about transforming from one thing into another; it’s about gaining the ability to perpetually evolve the entire business.
Busting 5 Digital Transformation Myths by John Rethans in Medium
As enterprises continue to invest in digital transformation, numerous anti-patterns have emerged—and businesses that want to succeed should take care to avoid them.
The Phases of Digital Transformation by Anant Jhingran and Michael Endler in CIO
How enterprises are accelerating their digital transformations by focusing on small, fast-moving teams, ecosystem participation, and machine intelligence.
Moving Faster with a Product Mindset by John Rethans and Michael Endler in Medium
Why businesses looking to evolve faster should focus on three core tenets: outside-in thinking, minimum viable products, and product maturity through iteration.
API management best practices
Using Metrics to Measure API-Driven Ecosystem Value by Chris Von See in Medium
A business can’t manage what it can’t measure—which is why businesses that are serious about digital transformation should embrace new metrics.
How to Ensure APIs Drive Everlasting Organizational Value by John Rethans in Programmable Web
Often, the difference between a future of options and a future of dead ends involves how a company designs and manages its APIs.
Understand the Power of Internal APIs by Brian Pagano in InformationWeek
Why missing the transition from legacy integration to using APIs to connect internal systems may prove the difference between success and failure.
How Microservices and APIs Make Beautiful Music Together by Brian Pagano in EnterpriseTech
Many enterprises have leveraged APIs and microservices to transform their businesses—but to succeed, it’s important to understand how these technologies work together.
So You Want to Monetize Your APIs? by John Rethans in Medium
Some APIs provide access to data or functions that are so valuable, the API provider can charge developers for access and even use the API to create new lines of business—but how does an enterprise know if its APIs are right for monetization?
Open Banking, PSD2, and GDPR
Will Branches Survive the Shift to Digital? by David Andrzejek in The Financial Brand
With the ubiquity of mobile apps, many people’s banking habits rely less and less on ATMs and other forms of physical infrastructure. What is the right branch strategy for the digital era?
Banking After GDPR: Consent and Agility by Paul Rohan in BankNews
As a consequence of technological and regulatory forces, new cornerstones have emerged in banking: consent and agility.
Do You Really Want to be the Next Big Banking Platform? by Rob Parker-Cole in Medium
For many banks, the most lucrative path may not be aspiring to be the platform at the center of an ecosystem so much as leveraging other ecosystem participants to offer better services and reach new customers and markets.
Interested in more tips for managing APIs and driving digital business? Check out the Apigee eBook, “The API Product Mindset.”
Enterprise leaders are learning that digital transformation isn’t really about transforming from one thing into another—there is no end state.
Rather, it’s about gaining the agility to continuously evolve—not to just bolt technology onto the existing business, but rather to leverage technology to change how the business operates, top to bottom, today and in the future.
This distinction is both important and, surveys suggest, challenging. How exactly does a business gain the agility to continuously evolve? Many enterprises may struggle to answer this question, given that research firm IDC has found that 59 percent of businesses are at a point of “digital impasse.”
As with almost every ongoing process, the key is to start small, with the right emphases and healthy habits, and then to grow. If you run a 10-minute mile today, you’ll need to be able to run an 8-minute mile before you can hope to eclipse six minutes.
Likewise, taking control of a company’s digital evolution often involves several phases, each with its own ingredients. These ingredients may change over time (they involve cloud technologies, APIs, and machine learning today) but the principles behind the phases are constant: speed from small teams, scale from ecosystems, and adaptation from constantly-refined data and intelligence.
Blog landing page image: Flickr Creative Commons/sophie
Editor's note: Today we hear from Remco Jansen, Telia Company’s API program manager who is responsible for API strategy and execution. Learn how this leading Stockholm-based telco uses APIs and API management to improve customer experience, partner connections, and organizational agility.
We at Telia Company have been working with APIs for a long time. Like many technology companies, we have thousands of APIs in use in our organization, but recently we decided to actively pursue a strategy to exploit the full range of possibilities with restful APIs—and also to deploy Apigee.
Three pillars for API success
When we decided to implement the Apigee API management platform for specific use cases, we soon realized that we needed to have a more clear API strategy to really leverage the technology. We had been building a lot of point-to-point integrations and also doing integration through an enterprise service bus, and we knew that this model was not going to be sustainable.
The driver for adopting the API gateway came from an architectural standpoint: we needed to have a way of decoupling back-end services from consumer services, but also needed to introduce common interfaces across the group—even when the back-end services were different across several regions.
We built our strategy on three pillars: customers, partners, and organizational agility. Our larger enterprise customers in particular expect us to have APIs to integrate their systems with ours. APIs also help us to improve the omnichannel experience for our customers, giving them the same high-quality experience, irrespective whether they visit our stores, go to our website, or use our mobile apps.
Further, we see APIs as a key enabler for collaboration with partners and aim to make our APIs region-agnostic to be even more relevant across our footprint.
And finally, we want to increase the agility in our organization by leveraging APIs so that it becomes easier and more cost efficient to develop new solutions and make changes to existing ones.
Innovating connected services
The results we’ve seen have been amazing; what can be done with a simple function has enabled some terrific use cases! I love APIs because they enable new unpredictable solutions to be created. The power of APIs is that you never know what people are going to build on top of them. That idea is clearly illustrated by our flagship use case, the Telia Zone service, which is a very simple API built on Apigee that uses the information about devices connected on a given Wi-Fi network with a Telia broadband connection.
Telia Zone now enables all kinds of home services to users, like smart doors, thermostats, ID services and logins, security, music, home automation, karaoke, and much more—all based on one simple API. About 900,000 households in Sweden have Telia Zone boxes, and soon we’ll be rolling it out in other countries, too.
Scaling for success
Over the last year we’ve seen immense growth in our API program. We’re exposing around 50 APIs and went from almost zero calls to 34 million per month by the end of last year. Our next big area of focus for the API program is productization. We’re working on getting all of our divisions to have a product manager for APIs so that we can achieve more collaboration at the product level within the company.
We will soon launch a new developer portal that will combine our existing portals and provide a single portal for all our APIs. My expectation is that the portal will drive further internal conversations about reuse and productization of APIs. We’re already seeing that even without the portal we’re starting to identify cases where we can say to stakeholders, “You know we already have an API for that.” And that’s the tipping point that we’ve been waiting for. That’s when APIs really become powerful and start to drive agility, when you can reuse APIs for new cases and don’t have to keep solving the same problem.
Digital transformation is hard. Imagine Atlas carrying the world on his shoulders. That represents the challenge of digital transformation a few years ago. Today’s digital transformation "Atlases" aren’t just holding the globe—they’re juggling ten of them.
Things like e-commerce and mobile apps—signs of digital sophistication just a few years ago—are now table stakes. The scope of transformation efforts has expanded to include cloud computing, machine learning, conversational interfaces and much more.
As enterprises wrangle with this growing complexity, they often look for inspiration — or simply to crib best practices—from large technology companies. Just last week, an intelligence technology leader at a Fortune 100 firm asked me, “How do we just do things the way Google (my employer) or Netflix does them?”
Read the full story in Forbes.
Landing page image credit: Je suis Eli (Flickr Creative Commons)
In this series of blog posts, we’ve been delving into the common ingredients we’ve discovered in working with hundreds of enterprises on their digital transformation journeys. In the the previous post, we explored the key aspects of alignment. In the final post of this series, we’ll wrap up with a discussion about the important elements of execution.
As we said in the first post of this series, aspiration is easy in business, but execution is hard. Over the years, we’ve observed many companies that try to execute their digital transformation plans but encounter strong headwinds due to a lack of executive support, basic disagreements about goals, and other problems that crop up due to insufficient vision and alignment.
When we assess execution, we look at how effectively the business can build and scale available APIs. This encompasses the software development lifecycle (SDLC), the ability to attract and retain strong technical talent, and “self-service”—the ease with which an organization’s APIs can be consumed.
Software development lifecycle (SDLC)
If you attempt to deploy an API-first approach using old governance and waterfall methods, you won’t achieve the speed, innovation, and cost reduction goals that motivated the transformation in the first place. Executing in the digital world means maintaining leverage amid ever-changing customer preferences.
To accomplish this, leading companies build APIs using modern, agile, iterative methods. Test-driven and behavior-driven design, as well as a focus on automation, are all parts of an API-first approach. Your SDLC is tightly coupled with how you fund and measure project success—in fact, it is an expression of how projects are funded and what is valued (project forecasting accuracy prioritized over customer experience, for example). Therefore, maturity in this dimension is predicated on proper alignment in leadership, metrics, and funding.
Developers are a key link in the digital value chain; they translate the raw materials of a company’s data and functions into apps and digital experiences that create value for the business. An organization’s ability to attract and develop strong technical talent is among its most important digital competencies.
Leading companies often require API skills of all software developer roles, and a solid understanding of digital business—including the role of APIs—should be required of all business roles. The API program will only produce results if it is paired with agile governance and funding, so organizations should empower developers to adopt modern development best practices such as automation and DevOps.
Talent retention is also crucial, especially as digital business skills have become more hotly coveted by employers. To keep developer engagement high and help teams produce impact, competitive enterprises establish communities of practice, including API evangelists and a developer portal to share updates, distribute best practices, and help developers more quickly and easily explore, test, and use APIs.
Self-service is where concepts—such as API-first strategies and developer-driven value chains—meet reality. If the developers you engage (internal or external) are not able to quickly consume your APIs, the program will fail to deliver impact. The gold standard for TTFHW, or “Time to First ‘Hello World’,” is five minutes.
To meet this goal, enterprises frequently build developer portals. Fully-developed portals typically include API catalogs to help developers quickly find the resources they need; API keys, sample code, interactive documentation, and testing tools that let developers start using APIs immediately; and forums and blogs to foster community.
Companies have always relied on one another to create business value: component suppliers feed manufacturers who feed distributors, and so on. But in the digital world, the complexity and fluidity of these relationships reach a new level.
Enterprises can extend their services with scale and speed that would have been unthinkable just a few years ago. They can focus on their core strengths while leveraging resources from other ecosystem participants, creating richer, more valuable digital experiences than most companies have the resources to produce alone and spreading their businesses to new audiences and markets. The speed of change and the range of opportunities are dizzying—which is why it’s so easy for businesses to hit hurdles or chart the wrong course.
Though there is no single “correct” path to digital competitiveness, there are common dimensions that virtually all digitally sophisticated organizations share and common relationships among those dimensions, regardless of industry.
To chart next steps, businesses should understand not only how these dimensions currently manifest within their organization but also how the dimensions interrelate—how strength in one area, such as funding, may be a prerequisite to excellence in another, such as agile software development cycles. This perspective helps business leaders to prioritize which steps, among seemingly infinite options, will actually bring the company closer to its digital transformation goals.
To help organizations with this process, we launched Apigee Compass, an online tool to help businesses chart a path through their digital transformations. Apigee Compass curates and delivers the information we've gathered and the lessons we've learned from working with Walgreens, Pitney Bowes, Magazine Luiza, Experian, and hundreds of other companies. The interactive, self-service tool can be used by anyone to assess their organization's digital maturity and chart a path to digital success.
Once you’ve assessed your business with Apigee Compass, focus on the dimensions in which your organization is weakest. Use the recommendations to understand what other dimensions this weakness affects as well as the steps you can take to remedy this weakness and advance to the next level of digital capability.
In this series of blog posts, we’ve been delving into the common ingredients we’ve discovered in working with hundreds of enterprises on their digital transformation journeys. Previously, we explored vision, one of three broad digital transformation concepts. Here, we will discuss the key aspects of alignment: leadership, funding, and metrics.
As Conway’s Law observes, systems reflect communication patterns. If your organization is siloed, your systems will be too. These divisions can fragment the brand experience your company presents to end users and hinder your company’s ability to change. Teams typically grow accustomed to existing methods and incentives, so don’t expect change to occur organically. Because digital transformation relies on not only deploying new technologies but also adopting new organizational approaches, leading organizations drive change from the top.
A top-down commitment is required to achieve the necessary cultural alignment. Apigee customer Magazine Luiza, whose omnichannel strategy has helped it thrive in a tough Brazilian economy, made this point clear in its Q4 2016 earnings statement, writing, “Technology [must move] from the background to center stage—and [be] seen as the brain of the business … Hierarchical structures, paralyzed by excessive bureaucracy, the fear of change, and attachment to past successes, usually strongly reject the digital culture.”
Modern business demands agile operations. API programs typically struggle when saddled with funding models, development cycles, and governance processes built for waterfall methods or other legacy approaches. Explicitly funding the API program as a platform can free teams to use data and iterate without having to frequently lobby for more money or navigate organizational bureaucracy. Organizational processes that support agile digital product teams are mandatory.
Because APIs are at the heart of modern business interactions, leading enterprises typically embrace metrics rooted in API consumption patterns. Traditional enterprise ROI metrics assume certain conditions: long payback periods and predictable patterns around transaction volume and pricing strength, for example. Digital business operates under different conditions, such as shorter opportunity windows and more fragmented customer segments, and these require different metrics.
Arbitrary metrics are even less useful than no metrics. Avoid measurements that are not connected to business results, such as the number of APIs produced. Focus on metrics that reflect API consumption and how APIs drive transactions; for example, which APIs produce the highest-value transactions per call, which APIs generate the highest partner and developer engagement, and which APIs are decreasing time-to-market for new products.
Leading businesses use metrics not only to inform new strategies but also to align leadership. Executive sponsors support things they can see—such as an API that’s attracting substantial developer attention or accelerating delivery of new products. Enterprises can accelerate their transformations by using API metrics to unite leaders around digital strategies and justify continued platform-level funding for the API program.
Coming up next, we’ll explore the final big topic that’s key to succeeding in digital transformation: execution. And for more on these topics, check out the eBook, “The Digital Transformation Journey" and explore Apigee Compass to get tailored recommendations for your company's digital journey.
Cambridge Assessment has been around for over 160 years, so we’re definitely not what you’d call a “digital native.” But like many organizations today, we’re on a digital transformation journey, and APIs are playing an important role.
We’re a wholly owned organization within the U.K.’s famed University of Cambridge. We operate three exam boards that provide assessment services to leading academic and government customers in more than 200 countries. Every year, we serve millions of people.
Our assessments are used for everything from visa to university applications and, as you might imagine, our services are of enormous importance to people at pivotal points in their lives. The results of the assessments they take, whether it’s to qualify for a job, temporary residence in another country, or acceptance in a university, can determine their future.
A platform for accelerating business
The nature of assessments is constantly evolving around the globe, and transitioning from paper to digital (though a lot of tests are still completed on paper). Consequently, the materials used for assessments is changing as well, to include more digital, audio, and video. From an IT perspective, we have to manage a growing body of digital information.
How could we be more efficient, better serve our customers, and open up new revenue streams? APIs are a core part of our answer. We’d been using APIs for more than nine years to share information with partners. But now we understand the full potential of APIs to benefit our partners as well as our own organization.
An on-premises platform with powerful management tools
Our initial implementation is on-premise, allowing us to take advantage of the Cambridge University Tier 3 data centers. In addition, we wanted a platform that offered powerful management tools, faster development, and the ability to more securely provide customers with access to our APIs. The Apigee platform performs exceptionally on these and other tests.
One of the first things we did with Apigee was build APIs to enable employee data access from one of our apps. We were able to build those APIs in one month, saving us £50,000 by reducing development time by about three months.
Building a chatbot from conversational APIs
Since then, we’ve put six APIs in production from the Apigee platform, with more in development. For example, we have a new headquarters building, The Triangle, where we’re consolidating staff from 11 offices around the city. We used conversational APIs on the Apigee platform to build chatbots that allow employees to easily find and book meeting rooms in our new headquarters using an app. For us, that’s exciting.
Additionally, with Apigee we created an internal API development portal to accelerate information sharing among our users. The ability to quickly turn on an internal API that allows parts of applications to access data is something that would have taken as long as six months to accomplish in the past.
Gracefully handling sudden peaks
For us, a key requirement in an API platform is the ability to gracefully handle sudden, enormous peaks in people accessing our services. When we release assessment results for universities, there may be a sudden surge of 200,000 candidates, all wanting to access the test results portal. The demand may only last for several hours, and then it dies down for another few months. Apigee handles this surge with ease.
To be sure, Cambridge Assessment is on a transformational journey. And transformations like this don’t occur at the speed of light. And yet, the Apigee API platform has already sped up the delivery of value to our business in many ways—and we’re just getting started.
Sam Patient is head of integration and API services at Cambridge Assessment
In a previous post, we introduced three broad and important concepts—vision, alignment, and execution—and the 10 core digital transformation dimensions that fall into these areas. Here, we’ll dig into vision.
When we talk about vision in the context of digital transformation, we consider how an organization has the right mindset to achieve digital transformation, and whether leaders understand the scope and core concepts involved. It encompasses the following dimensions: Platform, APIs, Outside-In, and Ecosystem.
Modern businesses are agile: they combine and recombine software to repackage their core capabilities for new use cases, interaction models, and digital experiences. Legacy IT architectures and traditional systems integration techniques can’t achieve this kind of speed. A platform approach is required. Enterprises build platform capabilities by creating APIs that empower developers to leverage core systems and data to build new services and products.
Apigee customer Magazine Luiza, one of the top retailers in Brazil, has leveraged its API platform in numerous ways. In June 2016, for example, the brand launched a new digital marketplace that enables third parties to sell under the Magazine Luiza banner, with new participants entering the ecosystem via Magazine Luiza’s API platform.
This approach means the company incurs virtually no marginal cost to add new marketplace customers. Magazine Luiza’s marketplace dramatically expanded the company’s e-commerce capabilities, supplanting a legacy sales and distribution system that supported only 35,000 SKUs. As of late 2017, the marketplace offered over 1 million SKUs.
Magazine Luiza’s other platform initiatives include an ecosystem of mobile apps that enable new services, from an app for in-store associates that provides real-time inventory information and enables customers to pay on the spot to a logistics app that coordinates hundreds of delivery contractors across Brazil.
Modern, RESTful/JSON APIs are the backbone of a digital transformation. They encourage developer productivity by providing both programming flexibility and an intuitive, accessible interface for accessing core systems. Leading digital businesses typically recognize APIs as strategic assets—to be designed and managed as products that empower developers.
If an enterprise treats APIs as middleware—as a way to do systems integration or to expose assets—it can undermine virtually all of its digital transformation efforts.
Sophisticated organizations monetize their APIs by packaging them for the needs of different developers. When Apigee customer AccuWeather began designing APIs for individual external developers, for example, it recognized that some developers would need up-to-the-minute weather information, which would generate billions of API calls, whereas others would prefer daily forecasts, which impose a much lower data overhead. The company customized multiple API packages to let developers purchase according to their needs.
Successful digital businesses adopt an outside-in perspective that focuses on how customers and partners experience the brand. Our most successful customers are typically also those most fanatical about exceptional customer experiences.
Organizations that master this dimension use analytics to understand the needs of both customers and the developers translating APIs into experiences for those customers. Armed with this information, companies can produce a more relevant set of APIs and offer apps and experiences that seamlessly cut across product, service, and internal organizational boundaries.
As the preceding examples demonstrate, digital ecosystems enable companies to focus on their strengths while relying on developers, partners, and other ecosystem participants for the infrastructure and services that turn those strengths into fully-featured digital experiences, expand the reach of those strengths, generate more demand, and facilitate entry into adjacent businesses.
This enables enterprises to distribute demand generation and value creation across potentially infinite digital networks. In many situations, it can also create network effects that cause momentum in one part of the ecosystem to spread elsewhere, creating the conditions for non-linear growth.
Competitive businesses recognize that ecosystem strategies are diverse—that a business doesn’t always need the gravitational center of an ecosystem to be successful. Often, rather than attempting to build a platform on the scale of Android or Facebook or attempting to be the central platform for an industry, companies grow simply by partnering with other ecosystem participants to expand their reach.
APIs can enable ecosystem participation by enabling companies to combine and recombine software and data without friction—but only if those APIs are designed and managed for this purpose, with developer and partner ease-of-use in mind.
Pitney Bowes, for example, has expanded its ecosystem by offering productized APIs to developers via its Commerce Cloud, as mentioned above. The company also leverages the Android operating system for its SendPro C-Series of all-in-one mailing, shipping, and tracking solutions, opening the devices up to the ecosystem of Android developers.
It will soon launch an online marketplace, built with Google Cloud’s Orbitera platform, to deliver apps built around its services. These ecosystems of external software, infrastructure, and developers have combined with the company’s internal strengths in shipping, logistics, and technology to open new revenue opportunities that arguably wouldn't have been available without an ecosystem approach.
Coming up, we’ll delve into the next important digital transformation concept: alignment. And for more on these topics, check out the eBook, “The Digital Transformation Journey” and explore Apigee Compass to get tailored recommendations for your company's digital journey.