Emergence of API Zone in Enterprise
For the first time ever on a black Friday more people shopped online with their mobile phone than in the store. There is tremendous amount of tail wind behind us around movement of cash to digital and the explosion of mobile devices providing the power of a branch in our hands. Thus retailers, merchants and banks are looking at digital to be closer to consumer.
Focus on Consumerization is becoming the driver behind the emergence of API zones in enterprise. Focusing on how to innovate consumer journeys across different touch points and form factors are the top priorities for enterprises.
After working for many years in Integration space, when I heard about hype around API for the first time, I immediately had a Déjà vu moment. However it took me some in depth analysis, discussion with my close friends who are in retail and banking business and some really intense customer workshop to demystify the API hype.
Last 3 years I have had multiple opportunities to work with some large Banks, Telecom Companies and Retailer on their digital strategy and increasingly I believe API strategy will become a key pillar for addressing organizations need around regulatory, diversification and business growth
Here are some of the perspectives around emergence of API zones in enterprises:
- The simplest and most common use cases today are around channel transformation where organizations are developing set of APIs to support intuitive customer journeys across form factors and devices. The considerations for API zone are-
- Intuitive customer journeys
- Ability to change
- Security - Network Edge security such as DDoS, XML/SQL/JS Injection, entitlement, Anti-virus etc
- Monitoring - Throttling of API, API analytics etc.
- Exposing catalog of services to partner, client and supplier ecosystem. These set of use case do have similarity with erstwhile B2B message exchange, however with an API approach the possibilities are much more. The considerations for API zone are-
- Onboarding and Management of consumers
- API SDK enabling client and partner ecosystem integration
- Security - Network Edge security, Authentication & Authorization
- Monitoring and Metering of APIs
- Lastly and the most impactful use case is the ability for enterprise to combine its own core capabilities with partner and third party provider to provide a differentiated experience to its customer. This is where enterprises are focusing heavily to differentiate itself in this competitive environment. The considerations for API zone are-
- Ability to compose API supporting interaction across customer life cycle (Find / Search, Asses, Evaluate, Select, Buy, Onboard, Service, Off board) for a product or service
- Partner / Third party API management and metering
- Open APIs
Payment Service Directive 2 (PSD2) succeeds the original PSD, which was implemented in 2009 and enabled the introduction of SEPA. PSD2 aims at broadening the scope of the regulation and is the first regulation which demands banks to provide (payments related) API's. And this is just the tip of the API Iceberg.
However the implications of APIs are going to be different for different business stakeholders and hence it is important to contextualize API strategy looking at your channel strategy, regulatory environment, partner & supplier ecosystem and off course customer to name a few.