How to future-proof digital transformation with an API strategy
This article was originally called How to future-proof IT for digital transformation and published on Gigabit.
Few trends have been at the fore more than digital transformation in recent years. Could 2020 be the year where reality finally catches up with the hype?
Recent research has revealed that nearly every organization is currently planning digital transformation initiatives, but there are still a number of challenges to overcome before most of them reach maturity.
Globally, transformational initiatives are held back by cultural challenges and the need to integrate legacy IT systems with data silos.
Organizations typically struggle with this: on average, only 28% of applications are integrated, preventing the true power of digital capabilities from being unlocked to fuel innovation and growth.
Taken as a whole, it’s mission-critical; 73% of global organizations fear their revenues will be negatively impacted in the next 12 months if their digital transformation projects fail.
Applications are at the heart of these projects, giving organizations the ability to offer differentiated customer experiences and drive operational efficiencies. But their value is diminished by running in silos: the vast majority (85%) of organizations said integration challenges hinder their ability to drive through digital transformation effectively.
With that in mind, it’s vital that organizations find a way to bring together applications, data, and devices seamlessly, regardless of whether they’re legacy or cutting-edge. This is the only way that they can truly unlock the new revenue channels with the data-driven insight that underpins digital transformation strategies.
Those with an API strategy in place are in the best place to achieve this. However, while the majority of global organizations appreciate the benefits that APIs can bring, few are doing so strategically in an efficient, cost-effective manner.
Amid increasing pressure to drive the organization forward, centralized IT departments are struggling to keep up with the demands placed upon them.
Alongside the constant challenge of day-to-day maintenance, IT teams are expected to innovate quickly to support the organization’s digital ambitions by developing new apps and capabilities in response to market demands.
Yet, they often find it difficult to juggle both priorities, and innovation often loses out. While the amount of projects IT teams are being asked to deliver has increased by 40% over the past year, many are unable to keep up, with 59% of IT teams reporting that they were unable to deliver on all their projects last year.
There’s an API for that
A well-considered API strategy can go some way towards reducing this strain. When implemented effectively, reusable APIs can take much of the burden of transformation away from the IT department.
APIs can unlock data and digital capabilities to enable a more composable enterprise, empowering line-of-business users to become ‘citizen integrators’ capable of creating their own digital solutions.
This enables the organization as a whole to become more agile: globally, 46% of organizations that implemented an API strategy reported increased IT agility as a result. In addition, over half (53%) of organizations with some form of API strategy in place say that IT has generated the most business value by building reusable integration assets that save time and money on future projects.
Despite this, there’s still much work to do.
Less than half (48%) of organizations worldwide currently use APIs to increase the efficiency of development processes, and most say they don’t have an effective way to share APIs.
Typically, this stems from a lack of an overarching API strategy. All too often, organizations struggle to make the most of API-led connectivity because they don’t have a dedicated team to oversee integration work. Non-IT staff are often left without crucial resources, and efforts, therefore, data remains piecemeal and siloed.
Those that follow this approach can maximize business value not just from customer engagement and growth, but also from increased productivity and greater agility via self-serve IT.
Atom Bank, the UK’s first mobile-only bank, is one company doing great work in this area.
Previously, its approach to integration consisted of a network of tightly coupled point-to-point integrations to connect disparate systems, but this blocked innovation.
By instead pursuing a reuse strategy enabled by an application network, the digital-native bank reduced the number of APIs it needs by half, while cutting the development cycle from one month to just a day, enabling it to drive innovation at speed.
Elsewhere, global aerospace giant Airbus offers another real-life example. The manufacturer has prioritized faster, easier access to data across the organization, through API-enabled reuse.
Its projects range from integrating bots and social media feeds with its employee collaboration platform, exposing its legacy SAP apps to a mobile front end, and connecting SharePoint to artificial intelligence systems to improve end-user experience with its IT services.
Looking to the future
Judging by the results of the Connectivity Benchmark Report 2020, organizations worldwide are making good progress with their API strategies: four in five (80%) are now using APIs as part of their digital transformation programs.
However, change is the only constant in the world of enterprise IT, so there’s no time for organizations to rest on their laurels.
They must continue to evolve their API strategies and embrace a composable enterprise mindset. As the demands on IT continue to rise, this mindset will be crucial for driving faster innovation and sustainable growth in the long term.
For more insights, download the 2020 Connectivity benchmark report.
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