The importance of APIs – often dubbed as the ‘fossil fuel for the next generation’ – is growing rapidly in the world of business. In a recent survey, it was found that around 72% of all enterprises already have well-defined API strategies in place. What’s more, 1 out of every 2 companies were generating (or were likely to do so within a year) significant revenue from their API programs. However, these stats do not automatically mean that working with APIs will guarantee big success for your organization. A properly optimized API strategy needs to be in place, and the following tips should come in handy in that regard:
Understand the need for an API strategy
Let’s get this one sorted out at the very outset. Don’t go for an enterprise API program simply because ‘all the others are doing it’. Take out time to analyze how an API strategy would help the core product/service development processes at your company. In other words, avoid focusing on the standalone value of APIs (unless, of course, you plan to offer APIs as final products), and consider how they are going to complement your business. Only if you find that there is a demand from customers, or a scope to network better with partners/collaborators, or even for building up a stronger mobility platform and ecosystem, go for an API strategy. Keep in mind the potential risks (security, quality, etc.) as well.
Note: With APIs, you can turn your business setup into an infrastructure-as-a-service (IaaS) architecture – building up your overall reach in the process.
Get an idea of the API value chain
For make your API strategy successful, you need to know the flow in which APIs are used. This is referred to as the ‘API value chain’. It has the existing backend systems/enterprise IT systems at the first block. Next up in the chain are the API providers, who create and deliver the interfaces to the web/mobile app developers. The latter use the APIs to create client applications. These, in turn, are downloaded and used by the end-users or the general public. So, the ‘API value chain’ looks something like this:
Backend architecture → API Providers → Application Developers → Client Apps → Final Users
Do a cost-revenue analysis
Remember that APIs do not have (in most cases) any intrinsic value. They are NOT technical solutions per se, but are meant to serve as important components in your overall business strategies. As such, it only makes sense that you should estimate the net returns from developing and implementing an API program. Calculate the overall costs of building the APIs – based on the total resources used up and systems engaged in making them, and compare that with the additional revenue channels that are likely to open up due to the innovations brought about by your strategy. Customize your API strategy in a way that your revenues are always (significantly) higher than your costs.
Study the importance of API version control
Having an API strategy without a version roadmap is like trying to control a rudderless ship. There can be heightened security threats, app makers can start using them to make applications (and make changes in the API themselves), and outdated APIs can get dragged along for too long. As the API entrepreneur, the onus is on you to settle on a version control system for your application program interfaces. Plan how your APIs will be tracked and monitored (consider all the measurable metrics), what the security protocol and related updates would be, and how you will retire/phase out the older APIs. For that, you will also need to have an idea about the four stages in an API lifecycle:
API Analysis → API Development → API in Operations → API Retirement
Pay attention to the technology
From a purely technical perspective, there are several choices to be made when you are laying the blueprints of an API strategy program. XML or JSON can be used for data formatting purposes, you can go with either the experience-based or the resource-based design guidelines, and obviously, take a stand on whether to go for SOAP (Simple Object Access Protocol) or REST (Representational State Transfer protocol) APIs. Whatever may be your final choices, make sure that they are taken with an eye on the long-term viability of your business. Remember that APIs are not short-term fixes, and the ideal API architecture for one company is not likely to be suitable for another enterprise.
Public APIs vs Private APIs
You have to specify the target developers who would be using your APIs to churn out applications. For that, depending on your company’s requirements, you have to decide to go with either Private APIs or Public APIs. The former are meant to be used only internally within an organization – by in-house developers for their own projects. Open APIs (as Public APIs are generally referred to), on the other hand, are accessible by third-party developers for making apps. While Private APIs are more ‘inward-focused’, the Public APIs are instrumental in making the maximum use of the existing IT assets of enterprises. Find out which type of APIs will be best suited for your business, and decide accordingly.
Note: Designing public APIs is trickier than doing the same for private APIs, particularly from the security viewpoint.
Know the role of everyone in an API program
It’s all very fine to have an API strategy on paper. However, it’s an entirely different ball game to actually implement it within your enterprise. Not engaging the right personnel in the right roles in API management is one of the biggest reasons for the failure of many enterprise APIs. The enterprise architect(s) should be working as the lead managers in your API strategy, overseeing the development, designing, modifications and deployment of APIs (along with their backend integration). Product managers should double up as the connection/communication channel between the ecosystem of API developers and API customers. The responsibilities of maintaining the API architecture should be taken by the system administrator(s) of your company. Other important team players involved in your API program include API testers, senior software engineers, internal/external app developers, and other stakeholders.
Build a MVP version of your API
Select the right API design style
Designing an API that would deliver value to your enterprise is not the easiest task in the world, and going with a wrong design model can further complicate matters. Based on your business goals and pre-specified API visions (i.e., how APIs are going to boost your business operations), you can choose a Pragmatic REST model, a True Rest (Hypermedia) design model, or a Web Service Tunneling model. With the importance of Internet of Things (IoT) rising, many enterprises also opt for the Event-driven API designing style. Make sure that the API design strategy you pick will make the interfaces in sync with your backend systems.
Manage the layers
Familiarity with the architectural design is vital for optimizing the overall API strategy for your business. The design, of course, has to be deployed in the core infrastructure of the API, for proper functionality of the latter. Broadly speaking, the data contained in APIs need to pass through 4 layers. The first is the Security Layer – where security standards and authentication tools (OpenID Connect, OAuth, etc.) are deployed. Next comes the Caching Layer, which keeps a tab on the total API implementations, by managing common requests with cached responses. The Representation Layer is the third in the API architecture hierarchy, where the focus is on presenting your APIs in a easy-to-understand form to target developers, so that they can make the best use of the APIs. Rounding off things is the Orchestration Layer, where multiple backend systems can be managed, and data from several sources (APIs) can be securely clubbed together.
Pay attention to the API Gateway
An API strategy might be good in theory, and it might even have a captive developer audience (a ready set of customers). However, all the good work might be undone, if you are not careful while creating the ‘API Gateway’. The gateway is supposed to deliver all the functionalities included in the core API infrastructure – right from orchestration and caching, to data security and access control. For an API program to be usable, its gateway needs to be very carefully developed.
Shorten the API development cycle
This won’t happen overnight, but as your business expands and demand for APIs increases, a shorter development cycle will become very important. Settling on a well-defined ‘API Practice’ is the best possible way for doing this. The standard methodologies, tools and standards should all be mentioned in this API Practice, together with an overview of the roadmap/version control of the interfaces. There are several web-based frameworks and API lifecycle management tools (software-as-a-service, or SaaS), which help in establishing a proper API Practice for enterprises. The main use of this is shortening the development cycle by standardizing the overall process and ruling out uncertainties as much as possible.
The overall quality factor
Having an underperforming API out there can prove to be counterproductive for your business (in the form of faulty marketing, production glitches, and even loss of external developers/customers). You need to ensure that APIs are easily pluggable to multiple systems simultaneously, are scalable and available, and handle high volumes of network requests (API calls) without any problems. Be careful about the fault tolerance of your APIs as well – as significant API downtimes are likely to create a negative impression on customers. Quality is, by far, the most important concern among API providers – and the problems often get exacerbated due to inabilities in finding the root cause and/or employing the wrong set of people to fix API issues. Perform all the standard API testing procedures – unless your APIs are good, your strategies won’t work!
Like any other business venture, setting up an API program represents an investment by your organization. The focus, hence, has to be on earning a profitable return from this investment – and that is precisely where the importance of API strategy optimization comes into the picture. Around 8 out of every 10 enterprises with 10000+ employees manage to earn $5 million annually, from APIs. Clearly, there are rewards aplenty for a well-managed API strategy, and these tips should get you started in the right direction.
Data resource: https://www.scribd.com/doc/313089698/The-Rising-Value-of-APIs
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