Business Value of APIs - TFG 2012 Issue2 (Webcast)
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PwC discusses how leading enterprises are responding to challenges from trends like social, mobile, analytics and cloud (SMAC) technologies. They are shifting to see information/digital content as the main driver of value, adopting digital operating models, and adjusting architectures to be more open through RESTful APIs. This allows them to better integrate with digital ecosystems. Case studies of companies like FedEx, Streetline and AT&T show how they are tapping new value sources by making more of their data accessible through APIs and digital platforms. PwC advocates that companies develop API strategies, productize their APIs, and create developer programs to optimize value from their digital assets and ecosystems.
![Tapping rising value of linked information
“We were looking for something where we can assign a
value to each one of those bits of information.”
“We use this [parking spot availability and payment]
information to create a smart parking ecosystem.”
—Mark Noworolski, Streetline
PwC 10](https://image.slidesharecdn.com/tfq2012issue2-businessvalueofapisapigeewebcast-121204153701-phpapp01/85/Business-Value-of-APIs-TFG-2012-Issue2-Webcast-10-320.jpg)
![AT&T: A permeable enterprise
AT&T’s API program:
• key pillar of innovation strategy
• an architecture to move at the
pace of change
• future proofs existing assets
• makes AT&T network into a
platform and addressable by
other innovators
• creates permeability
“[The API program] is an
architectural choice one
makes for speed.”
—John Donovan, AT&T
PwC 17](https://image.slidesharecdn.com/tfq2012issue2-businessvalueofapisapigeewebcast-121204153701-phpapp01/85/Business-Value-of-APIs-TFG-2012-Issue2-Webcast-17-320.jpg)
![Developer Program: Framework
[ Recruiting ]
Infrastructure
[ Community ]
[ Support ]
[ Promotion ]
PwC 29](https://image.slidesharecdn.com/tfq2012issue2-businessvalueofapisapigeewebcast-121204153701-phpapp01/85/Business-Value-of-APIs-TFG-2012-Issue2-Webcast-29-320.jpg)
![Developer Program: Community - Three Forces of
Engagement
[ Substance ]
[ Opportunity ] [ Charm ]
PwC](https://image.slidesharecdn.com/tfq2012issue2-businessvalueofapisapigeewebcast-121204153701-phpapp01/85/Business-Value-of-APIs-TFG-2012-Issue2-Webcast-32-320.jpg)
Business Value of APIs - TFG 2012 Issue2 (Webcast)
- 1. www.pwc.com/techforecast The business value of APIs PwC Technology Forecast 2012, Issue 2 December, 2012
- 2. Speakers • Moderator: Sam Ramji, Apigee • Bo Parker, Center for Technology & Innovation, PwC § The Business value of APIs • Scott Monson , Strategy Advisory, PwC § Getting Business Value from APIs PwC 2
- 3. Cloud PwC Center for computing Technology & Innovation Enterprise http://www. pwc.com/cti mobility Enterprise innovation Social technology Sustainability Advanced analytics Architecture Infrastructure Applications Data 3
- 4. Background How should clients (CIOs) deal with the challenges from multiple disruptive trends, Social, Mobile, Analytics, Cloud (SMAC) happening together? Challenges: • Pace of change in the marketplace • Demand for new apps, services, features • Customer power (Consumerization of IT) PwC
- 5. Interviews David Zanca Jon Donovan SVP of IT, Customer Access, Senior EVP and Revenue Systems Technology & Network Ops FedEx Services AT&T Thomas Wicinski Mark Noworolski VP Digital Access Marketing Chief Technology Officer FedEx Services Streetline PwC 5
- 6. Interviews Laura Merling SVP of Application Enablement Sam Ramji Alcatel-Lucent VP Strategy Apigee Devon Biondi VP Strategy Services John Musser Mashery Founder Programmableweb Alcatel-Lucent Brian Katz Director, head of mobility industrialization & engineering group Sanofi. PwC 6
- 7. How are leaders responding to the SMAC challenge? PwC 7
- 8. How are successful enterprises strategically managing the confluence of SMAC and related emerging trends? They are rethinking their enterprise architectures and emphasizing three fundamental changes: 1. Shift in value driver: digitization of business ecosystem means information content accounts for a faster rising proportion of the overall value of any product or service. 2. Shift in operating model: tapping into new drivers of value using a digital operating model, a model attuned to participating in or integrating with expanding digital ecosystems. 3. Shift in architecture: adjusting their business and IT architectures to take advantage of the rise of RESTful APIs to become a permeable enterprise. PwC 8
- 9. Case example: Streetline and Parking ecosystem Business ecosystems are becoming more digitized, where information content accounts for a rising proportion of the entire value of any product or service. PwC 9
- 10. Tapping rising value of linked information “We were looking for something where we can assign a value to each one of those bits of information.” “We use this [parking spot availability and payment] information to create a smart parking ecosystem.” —Mark Noworolski, Streetline PwC 10
- 11. Value drivers are shifting A consequence of SMAC is that value from bits PwC will rise faster than from atoms. 11
- 12. Case example: FedEx, a culture of valuing information • “information about package as valuable as package” • All assets instrumented and connected • Innovations on customer access to information • Architecture for low cost interactions in the ecosystem PwC 12
- 13. A culture of valuing information gives FedEx a digital operating model “Information about the package helps us run our business better. That comes from a digital operating model where all our assets are connected and surface information to increase overall value to us and the customer.” —David Zanca, FedEx Services “Not only do our customers want more information about the packages, but they also now want more interaction with FedEx and expect us to react to changes and resolve problems if they occur.” —Thomas Wicinski, FedEx Services PwC 13
- 14. Why companies do not have a Digital operating model? PwC 14
- 15. Emerging use of APIs scale integrations Use of external facing APIs to make connections in a digital ecosystem is rising PwC 15
- 16. Growth driven by REST style of APIs REST connections are stateless, loosely coupled and use popular web protocols Although not suitable in all cases, REST is simpler and scales easily PwC Create permeability, promotes co-creation in digital ecosystems 16
- 17. AT&T: A permeable enterprise AT&T’s API program: • key pillar of innovation strategy • an architecture to move at the pace of change • future proofs existing assets • makes AT&T network into a platform and addressable by other innovators • creates permeability “[The API program] is an architectural choice one makes for speed.” —John Donovan, AT&T PwC 17
- 18. AT&T’s goal is to make its network the most addressable network globally. “If you have infrastructure assets and are going to operate at a pace at which the external market is moving, you have to take capabilities—industry-specific or not— and make platforms from them.” —John Donovan, AT&T “We’re pivoting toward thinking about architecting everything we do in a more API-centric way” —Jacob Feinstein PwC 18
- 19. Open IT: CIO enabling the permeable enterprise Open IT builds on prior SOA efforts to scale integrations and engage internally and externally with digital ecosystems. PwC 19
- 20. Getting Business Value from APIs Scott Monson Director, Strategy Advisory PwC US Advisory PwC
- 21. SMAC: The power of the social enterprise The forces of SMAC transform the way firms collaborate with their stakeholders to unlock new value 1. Business Objectives Employees Legacy Business Processes Trading Partners 2. Innovation Strategy Markets Stakeholders Operating Model Dimensions 3. Organization 7. Funding 4. Culture 8. Portfolio 5. Governance 9. Processes 6. Team/Resources 10. Ecosystem 11. Motivators & Metrics PwC
- 22. Why APIs: Business Drivers • Agile, modernized environment • Partner friendly Relevance • Permeable • Low touch sales channels • Time to market • Self-service Cost Reduction API Innovation • Co-creation • Wisdom of the crowd • New distribution channels • New markets Revenue • New services and business models PwC 22 PwC CTI http://www.pwc.com/techforecast
- 23. Typical Engagement Elements ‘Whole Product’ Solution Life-Cycle PwC 1 .Strategy 5. Developer 2. Productize Program 4. API Optimization 3. Expose and Manage Apigee PwC 23
- 24. API Strategy – answer key questions related to program success by using fundamentals to define, approach and plan What data What can be Who is How well do Do you What can be and services made interested in you engage aggregate monetized? do you have? available? that data? them? APIs? Diagnosis Customer • Simplify the complexity by identifying certain aspects of the situation as critical. Guiding Policy • The overall approach chosen to cope Strategy with or overcome obstacles identified Fundamentals in the diagnosis Coherent Action Plan • Feasible, coordinated policies, Cost Competition resource commitments, and actions designed to carry out the guiding policy. PwC 24
- 25. API Strategy: Cost - Monetization and Business Models Direct Revenue • Charge for access or usage of the API • Syndicate Content and Data Distribution Channel • Embed your API in other sites and apps – Google Maps • Expand awareness through 3rd party distribution Marketing Channel • Measure API interactions and new traffic • Cheapest and Fastest way to build applications Application Enablement • Enable all platforms with one set of APIs • Use to enhance existing software and platforms Distribute Services • Enhance internal and external use of data and content • Address the long tail of markets and segments 3rd Party Innovation • Increase availability to innovation Lock-In • Integrated enterprise code tends not to change PwC 25
- 26. API Strategy: Customer – Developer Segments Commitment Development Marketing Awareness (decision) (support) Certification (promotion) Corporate Partners Business Core Managed Contract/ ROI Development Membership Process Relationship Most likely to have business impact Independents Small / Opportunity/ GM 50% Contract/ Marketing Distinguish Interest Community 50% Self Marketed Most likely to create breakthrough innovation Hobbyists Word of Mouth / Excitement Community Informal Word of Mouth Marketing Most likely to create excitement & support the community 26
- 27. API Strategy: Growth Scenarios “Foundry” Design Exclusive Centers member programs GM Specific Business Benefits Thought Events Leadership Sample App Development Partnership Development Developer Increased Evangelists Support Staffing Investment Scenario 1 – Minimum Community Management Event Portal Developer Marketing Development Support 2013 2014 2015 PwC 27
- 28. API Optimization: Getting the Most Out of Your Program Developer Partners Community Communication § Key metric management § Versioning / Deprecation § Performance measurement § Tweaks & feature updates § Usage patterns § New API’s § Standards § Business model updates § Competitive landscape § End of life Analyze Optimize & Maintain PwC
- 29. Developer Program: Framework [ Recruiting ] Infrastructure [ Community ] [ Support ] [ Promotion ] PwC 29
- 30. Developer Program: Recruiting - Getting Developer’s Interested Help developers solve real world problems Increase Build Skills Productivity Solve Problems Promote Win - Win PwC 30
- 31. Developer Program: Recruiting - Venues for creating program awareness • Business development • Established relationships • Trade shows • Word of mouth • Trade shows • Speaking at • Contests • Speaking at conferences conferences • Social media • Media • Media • Media Corporate Small and/or Hobbyists partners independent 31 PwC
- 32. Developer Program: Community - Three Forces of Engagement [ Substance ] [ Opportunity ] [ Charm ] PwC
- 33. Developer Program: Support Info Resources: Documentation, Code Technical Resources: App lifecycle samples, Forum, Blogs/Social management, Testing, Moderation, Certification Certification / Membership Levels: Program level Fee Support level Hand Core $$$$ holding Some Gold $$ support Open Community Free community PwC 33
- 34. Developer Program: Promote - Go to Market Strategies for Developers Co-branding Co-Marketing Help developers bring apps to market • App marketplace • Co-sponsorship of • Leaderboard of • Community portal trade shows popular apps where developers • Co-branded • Periodic app can propose ideas advertisements marketing and get voted on campaigns Corporate Small and/or partners independent Hobbyists User ratings Community voting PwC
- 35. Typical engagement elements Measurable Value Opportunities 1. API and Developer Program Strategy 2. API Productization 3. API Exposure and Management 4. API Optimization 5. Developer Program Execution PwC 35
- 36. Conclusion: Consumerization of APIs • APIs are becoming open and ubiquitous in digital ecosystems • The ability to create, expose and consume these interfaces is available to all (not just software or digital native companies) • Abstracting business capabilities to programmable interfaces provides a systematic method and architecture to engage with SMAC and related emerging trends • APIs are now strategic to all enterprises. PwC 36
- 37. Questions? “APIs are the building blocks for the digital economy.” - Laura Merling, Alcatel-Lucent PwC 37
- 38. Disclaimer PwC US helps organizations and individuals create the value they’re looking for. We’re a member of the PwC network of firms with 169,000 people in more than 158 countries. We’re committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com/us. © 2012 PricewaterhouseCoopers LLP, a Delaware limited liability partnership. All rights reserved. PwC refers to the US member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. PwC 38