A featured contribution from Leadership Perspectives, a curated forum for enterprise technology leaders, nominated by our subscribers and vetted by the CIOApplications Editorial Board.

Petco

APIs and MicroServices for Competitive Advantage

Every organization irrespective of their size, has a touchpoint with digital products in this fourth industrial revolution powered by digital technologies. As the smartphone becomes an entry point for most customer journeys all CXO’s need to think of APIs and MicroServices as the basic building block that provides competitive advantage. There is lot of buzz about AI and Machine learning these days. Even the smartest of algorithms need APIs to deliver the results of those algorithms to the end consumer. As such the APIs will be the key to building business processes that have flexibility to adapt and agility to change as and when customer behavior changes.

The biggest challenge facing the CXO’s in enabling APIs is that their existing business processes are built on top of monolithic applications. These monoliths are not engineered for speed and agility required in this fast changing digital age. I have worked in Media and Entertainment as well as Retail industries where we have interaction with consumers on daily basis. Both of these industries have been disrupted by the likes of Netflix and Amazon. The common theme between Netflix and Amazon is clearly the APIs and MicroServices architecture that has powered them to be disruptor in their respective industries.

If you have business need to launch a new product or a service to the market, the product needs to be delivered in few weeks otherwise competitors will beat you to the market. The monolithic applications cannot be changed fast enough and on top of that the business process changes are even more difficult as those processes are very tightly coupled with monolithic applications. The big ERP systems come to mind immediately.The challenge most traditional organizations are facing is in transforming their business processes that rely on monolithic applications and ERP systems. Those products were engineered to be tightly integrated within themselves.

The new companies and disruptors are able to innovate and out compete established players with their speed and agility as they have built their business processes on top of loosely coupled API based business tasks. They can stitch together a new business process on the fly using these microservices.

Most CIOs and IT executives have a goal of getting rid of the technical debt as fast as possible. The key to success is going to be how do they execute on that digital strategy and deliver value proposition to their product market using the APIs that are becoming as ubiquitous as the internet


APIs provide competitive advantage as they can be easily integrated into online app or a mobile app which are two of the most important entry points or channels to get new customers and revenue streams. For example, if I want to launch some sort of a “Membership” or “Subscription” program to retain existing customers and bring new customers, I can design an API that on front end captures customer’s details and on back end sets up subscription to send products or schedule services to customer. This can be easily hooked into online web app or a mobile app within days. If we have to do the same thing using traditional monolithic systems and message oriented middleware or old school SOA integration technologies, it will take months to deliver to the market.

Traditional organizations that built their systems in 90s and early 2000s will need to think of how to build the API layer for critical business processes. Three major cloud providers AWS, Microsoft and Google all provide an API Gateway which is the entry point for most APIs. The event for an API call can trigger number of different APIs which when stitched together provide a business process that is engineered for digital economy. Many Organizations are trying to figure out how to build this API layer, how to integrate it with their existing business processes. Apart from technological challenge in building these APIs, there is organizational challenge in terms of change management. The software development process using agile methodologies and associated automation using CI/CD is vital to ensure software teams can deploy changes multiple times a day. The other big dilemma for most organizations is whether to build this API layer on premise or in the cloud. There is also a hybrid approach which can be complex to implement.

Some of the key decisions you need to make based on what I have seen actually work in the industry is to
• Decide on centralized v/s decentralized development of APIs
• Finalize which API technology is suitable based on your application landscape
• Identify and prioritize which monolithic applications needs to be decomposed into microservices
• What is your cloud strategy in realizing the APIs and MicroServices

Most CIOs and IT executives have a goal of getting rid of the technical debt as fast as possible. The key to success is going to be how do they execute on that digital strategy and deliver value proposition to their product market using the APIs that are becoming as ubiquitous as the internet.

The articles from these contributors are based on their personal expertise and viewpoints, and do not necessarily reflect the opinions of their employers or affiliated organizations.