Opinion: Radha R, EVP and Head Digital Business at Mindtree, urges businesses to embrace the API revolution.
From an omnichannel overhaul to a value chain digitization to a data analytics upgrade, the expanse of digital transformation projects that businesses might undertake can be a little overwhelming. Where should they invest their dollars when there is so much to do?
A lot of the time companies come to us asking, essentially, where the low hanging fruit is. They want a relatively simple project that can get them a big bang for the buck.
And more often than not, the answer involves using the application program interface (API) to expose their data, products/services and digital infrastructure to third party developers.
"Expose" can be a frightening word when it comes to proprietary data and digital assets. But a self-service API layer can selectively open up only the necessary parts of their back end systems, allowing outside developers and niche startups to build innovative experiences and new offerings around their products and services.
The key part is that these experiences and offerings reach customers that the company itself may never have discovered.
For example, at Mindtree we carried out an omnichannel overhaul for a large retailer, and in the process we put an API in place that allowed the third-party developer ecosystem to gain access to the retailer’s catalogue, pricing and supply chain information. These developers found unique ways to spread this retailer’s products to new markets:
– A niche app serving gardening enthusiasts brought the retailer’s gardening products directly to their customer base.
– A professional networking site for contractors made it easier to get material costs and build estimates.
The developers benefited by making their own products and services better, and also took a percentage of any revenue they helped generate. For the retailer, with their product information spread widely into new markets, they brought in more than $1 billion in extra revenue.
Scale Out, Not Up
We call this "scaling out" rather than "scaling up," because aside from the technological investment to put it in place, there’s nothing else to add. No new products to develop, no new physical locations to grow to, no added promotional or human resources investments.
And it’s not just for retailers. APIs are vitally important in the travel industry, connecting airlines, hotels, taxi services, car rental companies, local restaurants, and so on. Aside from cross-pollinating the goods and services for all these businesses, it makes the customer experience far easier and more efficient, from booking to check-in to finding evening entertainment.
We have also done API work for major banks, creating a strategy that enabled them to expose certain data (historical and aggregated) to only a very select developer community. The Open Bank API platform is now shaping up to be an "App Store" type of platform where developers and entrepreneurs can build innovative apps that can connect to any bank API that adheres to its standards.
– Banks are opening up things like Treasury Services to their partners, who can use the bank’s infrastructure and back-end services to create fresh offerings and products.
– Entrepreneurs are offering their products and services using their own eWallets. Banks are exposing eWallet APIs, which the partners/entrepreneurs can white-label for personalized experiences.
Do More With Less
The API revolution goes hand in hand with other modern phenomena such as open source programming, crowdsourcing and the sharing economy. The fun thing about implementing APIs is that you take the leap, and then wait for the results as the entrepreneurial developer community does the work for you.
They build innovative systems and experiences that are powered by your business’s deep domain expertise, customer insights and optimized core systems.
This kind of work is moving at lightening pace, and early adopters will be the biggest beneficiaries. If you haven’t already, it’s time to pick the low hanging fruit.