API management use cases: Extending the CEO’s vocabulary

API management use cases
API management use cases

Have you ever thought about how our lifestyle changed in the last four to five years? Mobile phones have become an important part of our lives: searching and buying products with one click, tracking your health, attending online meetings, booking travel, paying bills and so on. This shift comes from a number of innovative companies that find new ways to engage us in their business through a seamless experience through various API management use cases.

While all these examples come from personal experiences in the consumer world, interactions between businesses follow the same pattern.

What drives this market transformation? Of course, there is a new type of business leader that sees something that others don’t. But behind new business ideas, we see a technology enabler, APIs, that have become the backbone of springing this innovation.

While, a few years back, APIs were the topic of software architects and developers, nowadays even business leaders of the world’s largest banks, government agencies and healthcare organizations embrace the word “API.”

“Our shared technology infrastructure—our networks, data centers, and the public and private cloud—decreases costs, enhances efficiency and makes all our businesses more productive. In addition, this allows us to embrace the fact that every business and merchant has its own software and also wants easy, integrated access to our products and services. We are delivering on that through the creation of a common JPMorgan Chase API (application programming interface) store that allows customers to add simple, secure payments to their software.”

JPMorgan Chase annual report

APIs are like blood vessels in a digital economy that brings innovative solutions to life in every industry, government and social area. The number of public APIs has grown dramatically in the last two years. This growth enables the creation of advanced services and widens opportunities to develop new and attractive applications.

API management use cases

As the API market gains momentum, companies not only need to accelerate their API programs but also develop a clear strategy to be successful in their respective industries. API management use cases that deliver business value can be broadly split into the following categories:

  • Driven by well-formulated business initiatives
  • Driven as a result of industry or government changes
  • Technical enablers

READ MORE: API market growth on the rise in the marketplace.

The common theme across all these API management use cases is a customer experience (CX).

Business-driven programs

The pace of change is ever-increasing. To fuel this pace, companies must reinvent a business approach and transform their business practices. This is primarily driven by changing a company’s culture to include distributed decision making, breaking silos, and quick and convenient access to business data, as well as give developers more freedom in delivering new solutions quickly.

Analyzing how customers or partners engage with your company’s services and applications helps to identify API opportunities. Pulling together business leaders, IT architectures, and developers in one room initiate a creative collaboration that triggers new ideas for using APIs in relieving existing business pains.

For example…

For example, a manufacturing company brought together business and IT people to analyze and improve a slow and painful partner onboarding process for a B2B solution. By giving developers an in-depth perspective on a partner experience with the existing solution and clearly identifying inefficiencies in this process, the line of business helped IT to identify a potential solution.

The creation of an API layer on top of the existing B2B solution enabled this company to automate and streamline an onboarding process by integrating B2B with email and document sharing applications. This led to reduced costs and high partner satisfaction/retention.

Taking a similar approach to bring everybody into one room, a paper product manufacturing company realized that by improving their distribution center operations, they could reduce delivery time and cut operation costs of the distribution centers. A development team created an orchestration flow for sending and receiving requests between manufacturing systems, robots, and machines to deliver and store products in the distribution centers. The core system that enabled this use case was an API Management solution that provided a reliable and flexible backbone for synchronizing and orchestrating this flow.

To improve the well-being of their patients and reduce costs, a healthcare provider created a solution based on APIs and microservices. It helps patients and doctors in tracking prescription medicine usage. Using IoT-enabled medicine bottles, this solution tracks if a patient takes their medicine as prescribed by his/her doctor. If a patient forgets to take their medicine, s/he receives a reminder.

If the patient doesn’t take the medicine after a predefined period of time, his/her doctor is alerted, and a nurse calls the patient. The solution sends SMS notifications, checks schedules and records medicine usage. This solution helps patients to better maintain their health conditions and reduces emergency room visits and other associated costs for patient care.

Industry and government regulations

There are a growing number of use cases that are dictated by industry or government agencies. The most known examples come from the banking industry—PSD2 in the EU (and similar directives in other countries/regions), FHIR for the healthcare industry and many state/regional initiatives to provide access to state/government information to the citizens.

Look at LUXUB. With the introduction of PSD2, LUXUB has realized that it is more cost-efficient for banks to all agree to work quickly, share the same PSD2 model, and publish their APIs together so that each bank can then compete on their unique differentiation, whether that be extended API products or by building relationships with specific developer segments.

LUXHUB helps banks to offload PSD2 complains from the banks: banks enable APIs to access their data and services and LUXHUB adds a security and compliance layer, so banks don’t have to implement and follow all details of PSD2 regulations.

In the healthcare industry, companies may see FHIR as a mandate that requires additional investments, but forward-thinking organizations see this as an opportunity. Consider a hospital that uses FHIR APIs to extends its data access to drug manufacturers, personal genomics companies and research institutions. This provides an opportunity for chronically ill patients to be more easily matched to relevant clinical trials or new precision medicine treatments designed to optimize efficiency or therapeutic benefit for particular groups of patients, using genetic or molecular profiling data, improving access to more personalized treatment options for the patient.

READ MORE: “Playing with FHIR” to ignite digital patient engagement.

IT-driven use cases

There are a number of great API management use cases that come from within IT. The following examples are common in many innovative companies:

  • Unlocking creativity of the development teams by giving them free and self-descriptive ways through API portals to deliver new apps and solutions
  • Enabling a single secure entry point from external clients and applying the company’s approved security policies, monitoring, and audits
  • Integrating different applications and data sources through APIs in order to automate processes and improve visibility into the company’s operations.

READ MORE: API portals foster engagement and innovation.

Enabling internal or external developers, partners, and third-party companies and startups ignite creativity beyond one’s imagination. Hackathons are a great way to inspire innovation.

A bank went through a transformation in its development approach and created a portal with APIs for internal use. The company ran a hackathon among its developers with attractive prizes for the three winning teams. It achieved the tremendous benefits of:

  • Softly pushing its developers to learn APIs
  • Generating ideas of how these APIs can improve the bank’s operations and customer outreach

By taking on this approach, the bank reduced IT development costs and increased the number of product releases by a factor of ten.

Word of caution

To understand and develop new use cases for an API-driven economy, companies need to estimate potential business benefits and priorities of those use cases. This includes not only the business/monetary value but also the readiness of the IT (experience, available headcount, etc.) to bring quickly those use cases to life. If IT can’t react within a reasonable time frame, it’s possible to look outside of your company for a partner or third-party service that can fill the gap.

While there are direct API monetization opportunities, most value comes from using APIs through the existing company’s channels. APIs fuel innovation and new opportunities by delivering new services, improving operational efficiency and creating pleasant user experiences.

If you consider public APIs and programs, you need to have a skilled CX team. The business value of an API is an understandable requirement. But some companies forget about providing great developer experience in their portals. A good API portal should provide self-registration, concise and clear API description, easily tryout, sandbox and seamless subscription experience. Only when you achieve this state of CX may you expect success in your API program.

Discover how companies are utilizing API Management.

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