API Business Models

What is the tipping point between an API aware company to an API driven company?

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Often you get anything related to APIs thrown into IT’s table and considered a purely IT issue. Also, you might have lots of APIs in your company, you just don’t know about it. APIs enable many mobile applications and SaaS software integrations. Just using the APIs for internal use is like storing them in a warehouse to gather dust. APIs should not be used only as a building material for “apps”  in one organizational silo. 

Look for these signs in your company to see how API-driven you are:

  • You have your customers and partners connected to you via APIs and you to them
  • Your marketing, sales, support, and purchasing issues revolve around APIs.
  • Your company positions itself as part of an ecosystem.
  • Your own digital transformation efforts get boosted by external innovations using your APIs.
  • You can develop digital services, customer and partner connections faster than ever before.

This is the direction where the open, Lean and business-oriented method APIOps Cycles (www.apiopscycles.com)  also drives you because it focuses on removing the “8 wastes” of Lean management from your processes (30 min video preview on our online course).

What are the tools for scaling the API practice internally? And Externally?

You need common methods, you need a set process, roles, skills, communication, and design guidelines. You also need a catalog of your APIs, which you can, of course, get by setting up an API management solution or many. 

People involved with customers, partners, or internal development programs need to truly understand the value and purpose of APIs, productization, and developer experience. You need to ensure both business and technology risks and opportunities are addressed. Collaboration and transparency inside the organization increase with the proper use of APIs. The organization must be ready also culturally for this change. Traditional business modeling and architecture design methods and guidelines would skip these needs. 

In the APIOps Cycles method, you are led from the business model to plan business impacts. Then to plan what role locations of your data, applications, customers, and partners play. You need to mind your network and IT infrastructure but also compliance with regulations. We have a joke in Finland about fitting Russians, Finns, and Swedes into the same sauna. Maybe they fit in a sauna, but not necessarily in the same API, due to regulations and data models. Information and request structure is a key part of the APIOps Cycles method, too. All the above areas have canvases that help the business and compliance experts to be involved in the design. 

One obvious question is can APIOps Cycles be used for internal APIs, too? Of course it can. Internal applications are “API consumers”, too and their users and developers have their own needs. When you create a successful API for internal use, it may well be extended to external use, too. Whether it makes sense to offer internal or external APIs depends on your business model. 

Marjukka Niinioja

Marjukka Niinioja

Founding Partner at Osaango.com
Niinoja is a co-author of API Economy 101 book. She is also the creator of the free "Introduction to API Economy" course with Tampere University. Niinioja is the “Mother” of the lean, open and business-oriented APIOps Cycles method. Niinioja works as API business consultant, architect, and trainer for companies and public-sector. She has 10+ years of experience with API Economy from retail, energy, ICT, construction and traffic industries, among others. Her team at Osaango Academy work together with universities, public sector and companies. They create courses on how to use APIs, Platforms and Data in business to grow thriving ecosystems.

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