Accelerating Digital Transformation With APIs as the Key to Disruption

Every company has valuable data already stored within their systems – capitalizing on the data, however, means taking it out from silos and making it easy to use and integrate. APIs enable these connections by allowing developers convenient access to different systems, even if those systems were not initially intended to interoperate.

APIs (or Application Programming Interfaces) are, in their most basic form, how software talks to software. A shared convention that allows even the most different applications to cooperate. We may not be aware of their existence, but that doesn’t stop us from using them throughout our digital experiences. From ordering an Uber, to chatting with our high-school friends, everything is possible through the power of interoperability, of APIs. And although some may consist of just simple integrations between system A and system B, when an API is designed with a future-proof developing mindset, it can become extremely powerful.

According to a research conducted by Apigee, 56% of IT decision-makers view APIs as assets that help organizations build better digital experiences and products. In the healthcare industry, for example, COVID-19 is increasing the need to share data between healthcare providers, payers and pharmaceutical companies to an almost crucial point. APIs are key enablers of data sharing which in turn is a contributing factor in the impressive growth within the digital healthcare industry – according to a report by Grand View Research, the global healthcare API market size is expected to reach USD 336 million by 2027. Sure, this growth can be attributed to pandemic response efforts, but also the large-scale digital transformation initiatives play a key role here. 

API maturity 

Though API traffic has increased across industries, the range of possible uses is vast, and most organizations are not fully leveraging their power, with a still relatively low adoption rate. According to a survey by Smartbear, less than 20% have spent more than 10 years building APIs, while the majority of companies (55%) reported less than five years of development.

A company’s API maturity and ability to execute on digital strategies depend on how APIs intersect with other technologies. While some make legacy applications accessible largely in order to bring the past in line with the present, others are used for interconnecting cloud-native microservices that facilitate granular development techniques. It helps that APIs may be hosted anywhere and everywhere: in the cloud, on a private server, or via hybrid models.

Microservices is the leading technology driver in API growth, and it is rapidly gaining ground with many organizations for its fine-grained modularity, flexibility, and speed. 65% of the Smartbear survey respondents chose Microservices as the technology that will most likely drive API growth. 

With data exchange at its core, the concept of an API is not a new one. Computing systems have been communicating for decades and while some have done so through proprietary methods, others have followed various communication standards, released over the years. Starting with CORBA in 1991, following along with SOAP and REST at the beginning of the millennium (1999-2000) and continuing with modern approaches such as GraphQL and gRPC, the technology is always reinventing itself. Through the work of Bob Reselman, the fun people at RedHat have put together An Architect’s guide to APIs, which we recommend reading in case you want to get technical about everything API.

Challenges

API standardization continues to be the top challenge (58%) for organizations as they attempt to scale data sizes, formats and functionality. With development increasing, so has the challenge of backwards compatibility, with or without versioning in mind. If we consider Microservices to be the most suitable orchestration strategy, then limited skills and experience pose the biggest challenges. The process of adopting Microservices is being throttled by the trouble organizations are having in finding developers with appropriate skills. 

From a technical perspective, deadlines continue to be API quality’s biggest obstacle, while maintaining quality is critical to scaling any API practice. Limited time due to workload and increasing demands for speed of delivery were the top two obstacles cited by the Apigee survey respondents, followed by lack of budget, likely due to the economic impact of COVID-19. 

Focus on 2021

Looking to the future, the Apigee research indicates a plan from businesses to increase investments in API programs, as well as to enhance security. Companies report that their key priorities for 2021 include a focus on API security and governance (50%), growth and management of API adoption (41%), investment in building a developer community (38%), generating revenue by monetizing APIs (31%), making more services and data publicly available (31%), and growing their investment in API operations and monitoring (20%).

To remain secure in a growing digital environment, enterprises should ensure control over who accesses APIs while still providing self-service access and a friction-free experience. As risk increases with use, it is essential that businesses carefully manage their API keys, in order to identify if API calls originate from legitimate users. Apigee reported a year-over-year 172% rise in abusive traffic, which makes the ability to analyze this API traffic more crucial than ever to both company security as well as digital transformation plans.

Even if 2021 proves to be as disruptive (or even more so) than the past year, the investments that companies make in digital transformation – and the technological strategies that power it – offer control and flexibility. The digital ecosystems that customers prefer may change and new business models may come to replace old ones, yet with well-designed APIs, companies can ensure that they are able to adapt their business, regardless of the level of disruption.