9 April 2021
APIs have long been viewed through technical glasses only and have been seen as an IT department responsibility. But in the course of digitalization and the new cloud era, more and more customers are asking whether a service can also be used via APIs. What are the specific characteristics of an API? Is an API necessary? And if so, what makes an API successful?
Let us take a machine rental company as a real-life example. It has created a web portal allowing craft businesses to book specialized equipment for their customer jobs. Yet a large customer wants more: He asks for a technical integration. This would allow him to reserve the equipment directly from his project planning software and have the rental fees automatically included in the effort estimate. It would eliminate the manual step of logging into the rental web portal and copying the data. The lessor could now set up a joint IT project with the customer or the customer's IT service provider to create an interface between the IT systems for transmitting rental bookings and rental prices.
But neither company will be happy with this. For the rental company, the approach does not scale, because another technical interface will be needed for each additional customer. And the big customer is not eager to be involved into a major IT project involving several companies and does not want to do a cross-company IT project to design the solution in the first place. Instead, customers expect an already existing interface to the rental company, which they can use immediately without many interactions thanks to the developer portal and comprehensible documentation.
More than a Technical Interface
This is the difference between a technical interface and an API. While almost any connection between two IT systems can be called an interface, an API is expected to be more:
- APIs work not only proprietarily within a corporate network, but also across companies.
- Cross-company access is enabled by standards such as HTTP and REST, which are supported by all operating systems and programming languages.
- APIs are accompanied by a developer portal that supports developers with detailed documentation, a sandbox for testing, and other services.
- APIs are designed such that they do not contain any customer-specific elements but fit for all customers.
Essential Part of the Product
But the most important thing is that APIs are an essential part of the product. So, when the rental company defines its offer for handicraft businesses, it not only defines the machines and rental conditions, but also whether the booking process can be done through an API and what this API looks like. Important points here are:
- The scope and functionality of the APIs are aligned with customer needs.
- APIs are designed to be easy for developers to understand and use (the so-called "developer experience").
- The API documentation is written by technical writers with good technical understanding to create a gentle learning curve for developers who want to use the API.
- Enhancements, changes, and the entire lifecycle of APIs are carefully managed like all other product aspects since they affect many existing customers and contracts.
In short, APIs are an essential part of the service and should be treated as such. Not least because it creates a clear competitive advantage.
This is exactly what the large customer in our example wants: a finished, standardized product.
So, what are the factors for successful implementation and provision of APIs? What do you have to watch out for, and what are the things that often cause implementations to fail in practice?
In the second part (APIs as a Success Factor for a Product), read how you can successfully master the shift from project to product in your company. And learn how to create exactly the right conditions for the kind of APIs your customers want.