The benefits of APIs are becoming more clear in an ever-evolving tech landscape, yet ITDMs still struggle to convince executives and investors to buy into an API-first strategy. Here’s a look at the importance of APIs in a changing world, and how ITDMs can make the business case in order to secure the best API strategy for their organization.

According to Google Cloud’s new “State of the API Economy 2021” report, a majority of IT decision-makers view application programming interfaces, or APIs, as essential ingredients in improved customers experiences, expanded partner engagement, accelerated innovation, and other demands of today’s business environment. This is encouraging: APIs are how software talks to other software, and since much of digital transformation involves combining disparate data and functionality into rich user experiences and process automations, APIs are an essential ingredient in modern business strategies. 

What’s less encouraging: the research surveys primarily IT professionals, not business leaders. It’s clear that IT people see the benefits of APIs in the ever-changing tech landscape, but we still hear regular concerns from these same people that they have trouble convincing executives and investors to buy into an API-first strategy. In this article, we’ll look into why they are having these difficulties and some proven ways to successfully position an API strategy not just as a technological solution, but also as a business requirement.

The importance of APIs in a changing world

The rise of APIs has been heavily influenced by the introduction of disruptive new business models and evolving customer preferences that traditional technologies are not positioned to quickly and efficiently address. 

For example, traditionally, if your business sold tickets to events, it would build physical ticket booths and maybe a website or first-party mobile app. Today, tickets in many cases aren’t so much a physical thing presented to an usher as a digital code that an usher scans. Likewise, tickets are less-often purchased in person as opposed to online, and reliance on a first-party website can be unnecessarily restrictive. It places the burden on the business to attract customers, whereas surfacing organically in social media, search engine results, and other digital experiences lets the business meet customers where they’re already assembled. 

Moreover, as COVID-19 continues to disrupt events throughout the world, many ticket sellers—and most organizations, for that matter—have pivoted to digital-first business interactions as a matter of necessity. All of these changes in the business model, and all of the interacting systems and functionality that underpin them, rely on communication among APIs. 

Similarly, today’s banks cannot grow by simply building more branches or hiring more tellers. Instead, they need to make financial information and functionality available when and where customers require it, whether that means via an ATM, a first-party app, or within some other digital experience. Many banks also need to do more than just present this functionality, as customers are increasingly interested in the analytics and insights their spending patterns can yield. Again, all of these interactions—from customers making a purchase within an app to banks applying machine learning in order to offer customers financial insights—are enabled by APIs.     

Related: The “State of API Economy 2021” report describes how digital transformation initiatives evolved throughout 2020, as well as where they’re headed in the years to come. Download for free.

When guidance meets resistance

These examples do not illustrate technology that updates the status quo, but rather technology that unlocks business opportunities that transcend the status quo—and that help businesses to thrive even as the status quo fades into irrelevance and obsolescence. APIs are thus not just an IT topic but also important business enablers that should be understood by everyone involved with the enterprise’s investments, from internal stakeholders approving business strategies to external shareholders trying to assess an organization’s trajectory. 

The challenge for investor relations is to convey these financial and operational benefits in a way that clearly communicates the need for a new business model rather than refinements to the existing models. It’s essential that IT professionals understand APIs, but it’s also essential for business leaders to understand them too.

This is even trickier given that arguments for API investments are often based on future potential, while arguments for more conservative alternatives are based on past success. 

At a high level, the API value proposition is clear: In the past, valuable functionality and data have been encased in systems and applications, making them difficult to scale or leverage for new, evolving use cases. In contrast, APIs make functionality and data infinitely reusable, infinitely scalable, and modular such that APIs can easily be combined for new uses. All of this accrues to richer user experiences and more flexibility than ever for companies to monetize their digital assets, share them with partners, or combine them with assets from third parties. 

It’s essential that IT professionals understand APIs, but it’s also essential for business leaders to understand them too.

But investors typically want as much information as possible because their decisions can affect not just productivity and output, but company stock prices and potential future growth. High-level arguments may not be persuasive. The deeper assurances investors crave would normally come from guidance.

Guidance in this context refers to insights based on growth forecasts and customer adoption, but this can be difficult early in market entry. Robust forecasting processes need to be developed to demonstrate the efficacy and value of the API economy, which can be hard to predict: whereas APIs are well understood in some sectors, and especially among digital natives, they are in the early stages of the growth rate in other verticals, making it challenging to forecast developer adoption of a given API. And since there is a shortage of information, trying to use traditional guidance comes with a risk of being wrong and thus of little value to investors.

Related: Set your 2021 API resolutions with these top 2020 posts.

How to deliver a more useful value proposition

While guidance may be premature during the early stages of market entry, investor relations teams still need to convey the full value of an enterprise to investors. To do this, they need a value proposition that emphasizes the intrinsic value of the investment while reinforcing the benefits that can best drive business and stock growth. Considering how large an investment of time, effort, and money transitioning to an API economy can be, it is vital to convey that the benefits are substantial.

A solid value proposition should demonstrate maximum returns, and while this shouldn’t include far-fetched or unobtainable claims, it can include reasonable aspirational visions alongside statistical insights. To craft these aspirational narratives, investor relations teams should look to their organization’s existing business needs and challenges, and then demonstrate how APIs can benefit the organization in these areas. Here are some options that speak to a number of common business requirements:

• Sales channel: API investments are reusable, improve speed to market, enable automated processes and partner onboarding, and can uncover unanticipated opportunities.
• Cost: Businesses can reduce operational costs by using and reusing APIs for innovation and business development, and by using the services native to your partner’s digital surface, you can further reduce innovation costs and risks.
• Earnings: API-enabled digital ecosystems unlock a variety of partner services that leverage the business’s shared data to drive new customer acquisition, new market positions, new transaction volumes, and direct API monetization.
• Risk mitigation: By investing in a credible API, businesses can mitigate downside risks that traditional enterprises can face from market disruptors, industry-wide shifts to digital tools, and inabilities to ingest and analyze growing data sources.
• Intellectual property: Unlike project-driven innovation and customized, point-to-point integration that traps enterprise knowledge in small teams and divisional silos, APIs are reusable and modular, breaking down silos and encouraging intra-organizational collaboration.
• Speed to market: The efficient, repeatable API interface informs improvements to the fulfillment process with consistent access to data from across the organization, which drives solutions that more quickly and efficiently meet customer needs.
• Ethics: APIs offer the flexibility and economical advantages that give organizations the capacity to focus on their brand’s ethical “reason for being” beyond profitability by serving economically marginal and underserved market segments.
• Customer credibility: Organizations can deliver the extended, connected digital experiences that customers expect with the tools and flexibility included with API products.
• Employee retention: Businesses can avoid losing key employees by updating their legacy technologies with APIs, giving employees the opportunity to enhance their skills with modern technologies.
• Corporate strategy: Enterprises that use APIs’ reusable, modular structure and tools are more capable of adapting to rapid structural shifts in customer demand patterns and sectoral changes in the economy.

Whichever of these business challenges a team speaks to, it is imperative that they demonstrate the benefits of APIs, and that once they’ve determined the angle they intend to use, they keep their message consistent. While we’ve seen a number of viable ways to position APIs as a winning strategy, switching among them could make the presentation—and APIs in general—seem insubstantial and unreliable. 

This is why it’s key to decide on the most relevant business concerns, and once you’ve tailored your presentation, to make sure that you have message alignment, including buy-in and support from C-level executives. With a strong pitch built around solving existing business concerns and solidarity from relevant stakeholders, you can go into your investor meeting with the confidence to secure the best API strategy for your organization.

Strengthen your pitch with additional insights. Here are five key trends in 2021 for API-first digital transformation.

About the Author: Paul Rohan is a researcher on Open Banking and a Google Cloud solutions consultant. Paul works with banking C-Suites that are examining the impact of the Platform Economy and Digital Ecosystems on financial services industry growth, market structures and governance. Paul is the author of “PSD2 in Plain English” and “Open Banking Strategy Formation”.

Editor’s note: We invited partners from across our retail ecosystem to share stories, best practices, and tips and tricks on how they are helping retailers transform during a time that continues to see tremendous change. This original blog post was published by OnlineSales.ai. Please enjoy this updated entry from our partner.

Tata’s online healthcare entity, Tata 1mg, aims to revolutionize how a consumer finds the right healthcare professional for their needs. The platform offers e-pharmacy services, diagnostics, and health content and has more than 200,000 active brands in its rapidly expanding list of suppliers, sellers and manufacturers. Several of these brands would need regular involvement from the marketplace team in order to set up and run ad campaigns. As one of the largest platforms, Tata 1mg approached OnlineSales.ai to address their growing needs for an efficient Retail Media Monetisation suite to help scale up their existing monetisation efforts. 

Tata 1mg needed more data-driven insights and customizability for their monetisation efforts

Tata 1mg saw several challenges that they needed to address.

1. Manual effort: Tata 1mg marketplace team’s monetization process was largely manual and required heavy time and resource investment to activate advertisers, which subsequently ate into their overall ad revenues.
2. Non-scalable framework: Given the fast-growing number of advertisers on their marketplace – well into the hundreds of thousands – it became increasingly clear that their existing monetization framework was not scalable.
3. Inadequate reporting & analytics: The existing framework facilitated only simple reporting, and brands were not able to draw the deep insights they needed to make data-led decisions and refine their advertising ROIs.
4. Steep learning curve: Several brands lacked dedicated advertising experts who could bring the experience and skills needed to plan successful ad campaigns and optimize budgets. The involved learning curve led to increased advertiser-churn.
5. Lack of personalized offerings: The manual nature of Tata 1mg’s monetization framework left little room for customizability, and account managers could offer very little in terms of tailored ad-buying experiences to different types of advertisers.

All of these issues led to regular revenue leakage. Tata 1mg realized the need for a central platform that addressed the above-mentioned issues and would also be able to cater to new ad channels and the requirements thereof. Developing such a solution in house was evaluated, but was found to be expensive and would require a lot of time to build.

OnlineSales.ai’s AI/ML-powered solution on Google Cloud offered the automation and flexibility to support modern omnichannel advertising needs

Therefore, Tata 1mg looked to OnlineSales.ai Monetize, an AI/ML-powered retail media monetisation suite on Google Cloud, to help address their needs for a cloud-based monetisation platform that offered the flexibility to support omnichannel advertising models, had automation built in to reduce manual tasks, provided detailed intelligence and analytics, and delivered quick, reliable scalability.

1. White labeled self-serve platform: OnlineSales.ai’s retail media platform was implemented within a short 4 weeks. After thorough testing and implementation, the platform was successfully launched, and enabled sellers to run ads on a fully self-serve platform. This required zero involvement from the Tata team.
2. Unified omni channel buying: The team at OnlineSales.ai worked closely with the platform’s core teams to activate and mobilize various advertising products through a self-serve platform, while simultaneously addressing any unique requirements they had.
3. Omnichannel analytics with AI-led suggestions: Sellers are now also able to generate detailed reports that provide them critical insights into campaigns, and help them make better use of their budgets – enhancing their experience and interest in advertising on the platform.
4. Personalized buying experiences: The tailored UX offered by OnlineSales.ai’s Monetize helped Tata engage brands of all levels in technical aptitude to use the platform easily. This also allowed admins to configure what types of inventories were available to different brands or advertiser segments.

OnlineSales.ai makes use of Google Cloud Dataflow to facilitate computations on real-time streaming. Microservices are deployed on the Google Kubernetes Engine (GKE) platform due to the solution’s well-known ability to handle scale.

In addition, Dataproc is used by the company to run batch processing apps while Cloud Load Balancing helps manage traffic across different regions; all at scale. Onlinesales.ai also uses Memorystore as a database for their ad servers in order to have very low latency, and deploys BigQuery to run analytical applications and facilitate powerful reporting. The bulk of their office applications are deployed on different VMs on Compute Engine, and the company also makes use of Cloud Storage for data storage and transfers between applications.

Learn more about OnlineSales.ai available on the Google Cloud Marketplace.

^{About OnlineSales.ai}

^{OnlineSales.ai, offers a fully white labeled retail media platform which helps retailers unlock additional revenue by activating advertising real estate on their platform. With its AI/ML-powered solution, OnlineSales.ai allows retailers to turn brands of all sizes into advertisers – at scale. Its self-serve platform simplifies the ad buying process, and enhances outcomes with smart automation, boosting ad retailers’ ad revenues by multiples.}

Google Cloud Results

• Replaced conflicting, time-consuming paper logs with a near real-time, transparent app
• Scaled rapidly and easily to accommodate new teams thanks to Google App Engine
• Enables photographic and video communication to replace confusing text
• New factory solution rolled out in just 15 days

In 1877, Pietro Barilla set up a small bakery to make pasta and baked goods for the people of Parma, Italy. Today, Barilla applies its 140 years of baking knowledge on a global scale, with six major manufacturing sites in Italy and an international network employing over 8,000 people. As the world’s leading producer of pasta, Barilla knows that when it comes to making quality food, great communication is key. That’s why the company plans to become a completely digital, looking to technology to improve the way it works.

Teams at the Barilla factory in Cremona work along a production line more than one-kilometer long, staffed by three shifts of workers a day. When one shift handed over to the next or requested machine maintenance teams, they used paper notebooks and unofficial instant messaging to communicate. That meant there was no authoritative, real-time record of events, communication was messy, oversight was poor, and teams had to hold daily morning meetings to synchronise notes.

Barilla worked with the Google Cloud Partner Injenia to create a solution, beginning with a consultative process on the factory floor.

“We had the idea to to start from the bottom and work up,” says Cristiano Boscato at Injenia. “Barilla’s top staff were brilliant about letting us do it. Eight of us from Injenia spent months on the factory lines with Barilla workers, collecting ideas on Google Docs, making presentations with Slides and collecting feedback with Forms. The CollaborAction app we created is the result of an amazing partnership.”

Co-designing a team social network

“Everything at the Cremona plant was managed offline, with paper,” explains Alessandra Ardrizzoia, Digital Engagement Senior Manager at Barilla. “Workers on the line would track events in notebooks, the shift leader would have another notebook, and the leader of the maintenance team would have yet another notebook. Everybody wrote their own text description of events, so there would be mismatches in the information going around.”

To resolve this, teams would meet at 8:30am every day to reconstruct a consistent narrative. In addition, machine maintenance workers were already using instant messaging to communicate with the line. Barilla and Injenia looked for a solution that could deliver a searchable, single version of events, with the ease of use of a mobile messaging application.

After consulting factory workers for ideas, Injenia created CollaborAction, a custom-built app that brought G Suite collaboration tools together on an Google App Engine platform, using Google Cloud SQL to index files. Google+, Google Drive and Hangouts were not only highly available and easy-to-use, they also “helped with fast adoption, with interfaces that workers could already relate to.” Meanwhile Google App Engine enabled the Injenia team to deliver updates and new versions at speed, as part of a feedback process with workers who offered suggestions through a link to Forms embedded in the app.

Google+ provides an intuitive social media dashboard that workers felt comfortable with. Now teams use company tablets placed at intervals along the line to log in, report issues to other teams, photograph problems, schedule maintenance, give status updates through Hangouts chat, and have visibility on the whole process as it takes place.

“Everyone in the Cremona plant was really happy with the new social collaboration process. Because they were involved in designing the solution, they felt involved and really engaged with the process,” says Alessandra. “And now that everyone is aligned with CollaborAction, all the work in the plant is more effective. They are more agile and can use their time in more added-value activities.”

Optimization and a national roll-out

Created in Cremona, now CollaborAction connects over 1,000 users in six of Barilla’s factories in Italy. “The pilot at Cremona took one month, and adoption has been easier and faster in every plant we’ve taken it to,” says Cristiano. “We have another five or six plants more, and it takes no more than 15 days to introduce. That’s incredible.”

Because CollaborAction is a mobile app built on Google App Engine, scaling to meet new demand has been simple. Now maintenance teams use the app on smartphones, line workers use it on tablets, and shift leaders use it on laptops, so the entire team is aligned in close to real-time on a single version of events. And now teams communicate with video and photographs as well as text, there’s less room for confusion, as Alessandra explains. “It’s no problem understanding what’s happening in a video or picture, compared to a message that just says ‘something is going wrong.’ On a production line, where one part leads into the next, that speed makes a difference, and means we don’t have to throw as much food away when something breaks down.”

“Now we’re collecting feedback from all of the plants using CollaborAction and using it to create a standardised solution that we can apply across all of our plants,” says Alessandra. “We’re side-by-side with the workers in that sense, trying to address their needs with new features. It’s a way to make the workers feel like part of the solution, and that the app represents their needs and their voice.”

Solving a universal problem

By the end of 2018, Barilla and Injenia aim to have deployed CollaborAction to 2,700 employees at 18 factories worldwide. Barilla has already collected more than 50,000 posts with the app, including around 20,000 photographs and videos, and is now considering ways to apply Cloud Machine Learning Engine to create a maintenance chatbot or direct IoT connection with machinery.

“CollaborAction hasn’t just made our maintenance processes faster and more efficient, its also exponentially increased the knowledge and understanding employees have about their work,” says Alessandra. “It’s improving team spirit, too, such as when employees use CollaborAction to arrange to play soccer. It’s become the main communication tool for the entire plant.”