APIs prove to be key to digital transformation

An application programming interface (API) is a way for software components to communicate. APIs allow you, for example, to post a YouTube video on another website and help developers easily create new services. As they play a significant role in digital transformation, Wärtsilä is using APIs to deliver value to its customers. Find out how.

“APIs are the next revolution of the web,” says Kin Lane of API Evangelist, who researches the technology, business and politics of APIs.

“Think about how the web changed how we did business between 1995 and 2000: that is where we currently are with APIs, except now it is about delivering data, content and algorithms to mobile, devices and other types of applications beyond the web,” says Lane.

Google Maps is a great example. Using APIs, a logistics company can track its fleet and optimise routes, a charity can show donors where their money goes, or a gaming start-up can create a location-based mobile adventure. Suddenly, location information is being used in novel formats. Lane says this is understanding what digital assets exist and redefining them as individual resources that can be used in new ways.

“This allows companies, organisations and government agencies to better define what they do, and be more agile, flexible and transparent in how they operate,” Lane says. “This opens them up to new ways of doing business without legacy friction, cost and challenges in scaling.”

Developers wanted

Pentti Peisa, Director of Enterprise Architecture and Technology, leads an API team at Wärtsilä. He points out that APIs are increasingly important for how they do business.

“A shipbuilder might need to order parts from ten different suppliers, for example,” Peisa says. “Now they need to order from ten different platforms. It would be much more efficient if the suppliers provided machine-usable interfaces – APIs – so they could order everything through their own system. This is what Wärtsilä is working on.”

Yet this is only an example. Perhaps in the future Wärtsilä APIs could be opened to third party developers. A shipping company might develop a mobile app to monitor its engines. An environmental agency could measure power plant efficiency. Investors might have new tools to estimate future fuel costs in listed companies. The possibilities are endless, which is exactly the point.

“The long-term goal is to have an open portal for external developers,” says Peisa. “We are a smart technology company. If we offer third parties access to our APIs they can build their own business cases.”

Try (and fail) faster

APIs have a more important role in digital transformation. They can change the entire process of creation.

“By using APIs we have a much more agile development process. We have more speed, more flexibility and more backend services,” Peisa explains. “You might need a slower process for something which needs to be more robust, like an ERP system, but you have the ability to be fast with something experimental. APIs allow us to try and fail faster.”

Increasingly, what’s important for a business is not simply having a good idea. What is critical is how agilely the company can adapt that service to changing consumer preferences. A new service can change as it is being developed, and it can change even after it is in the market, thanks to APIs.

Into the cloud

The use of APIs is a major component to the new, agile method of development, which emphasises on continuous integration, delivery and deployment. Potential customers have the opportunity to be part of the development process. API-driven development allows the customers to test and use APIs, delivering valuable feedback during the process of creation.

This philosophy is especially apparent in developing cloud-native applications. Amazon Web Services believes so strongly in APIs that they popularised the idea of developing the API first and the actual application, thereafter.

“There are definitely a lot of benefits to using APIs,” says Peisa, and starts ticking items off on his fingers. “They offer cost savings, increased profits, faster development and new monetisation channels like selling data. Also, third party developers will have a self-service portal, so that means they need less of our time and effort. Wärtsilä’s customers want APIs to integrate with their backend systems, and we are working hard to develop them.”

Written by

David J. Cord