Consumer Demand for Voice Activated Services is Main Driver
Some 89 percent of UK organisations report an improvement in their ability to leverage third-party developer innovation using APIs – 20 percent more than the average in EMEA (69 percent). This is the major finding from a new global study, APIs: Building a Connected Business in the App Economy, commissioned by CA Technologies.
By opening up and sharing select applications with third parties, UK organisations are seeing the greatest results from absorbing data from partners and adding essential services to their apps—without having to write new code. Among these innovations are ‘conversational commerce’ services that enable consumers to interact with brands or aggregated services using chat, messaging or other natural-language interfaces.
Application programming interfaces or APIs, are the central nervous system of the app economy. By allowing pieces of software to communicate with each other, they provide ready-made, universal access to whatever functionality an organisation needs to deliver.
“Conversational commerce is an example of this new innovation: More enterprises are using APIs to aggregate services together and activate these by voice command,” says Ian Clark, Senior Director, EMEA API Management, CA Technologies. “For example, instructing your mobile device using natural language to book a flight and aggregating different services together to book a preferred hotel, restaurant or taxi partner at the destination.”
API use increases business performance across multiple KPIs
The advantages of APIs are not limited to third-party developer innovation. According to the study:
- 78 percent of UK organisations report an improvement in customer experience using APIs—the highest figure in EMEA after France
- 70 percent experience a more streamlined supply/demand chain owing to APIs
- 68 percent report improved digital reach
In terms of the metric difference made by APIs, UK companies are experiencing:
- 36 percent increase in customer satisfaction
- 38 percent fall in IT-related costs
- 37 percent reduction in compliance audit failures
Widespread API adoption and increased agility—but barriers remain
Some 82 percent of UK organisations have now adopted APIs, and this widespread use is focused—among many processes—on driving revenue growth (cited by 21 percent) and delivering speed and innovation via third-party APIs (29 percent).
The result is increased business agility. According to the study, UK organisations are seeing a 30 percent increase in business agility (i.e. speed to market) from their API efforts—reducing the time to develop/test and release new apps from an average of 14.86 weeks to 10.46 weeks. The majority (52%) of UK executives also believe that their APIs are highly effective at differentiating their companies from the competition.
Barriers to API adoption remain though. For UK organisations, the major barriers are defining the business value (cited by 37 percent), the lack of skilled resources (36 percent), and the time needed to develop an API (32 percent).
API management and API management maturity
The growing use of APIs calls for a formalised approach to API management, which encompasses creating, securing, managing, and optimising APIs throughout their lifecycle, and at enterprise scale.
With this in mind, the study includes an API management maturity model to assess how far organisations have implemented the tools and technologies, systems and processes, and capabilities required for full API lifecycle management. Some 43 percent of UK organisations can be considered advanced in API management.
The study also shows significant benefits to mature API management adoption for organisations across EMEA (not specifically the UK):
- Advanced API management users in EMEA are more than twice as confident at being able to differentiate themselves from the competition as basic API users (82 percent versus 36 percent);
- 93 percent of advanced API management users experience an improvement in customer experience compared to 64 percent for basic users;
- 86 percent of advanced API management users report an improvement in third-party developer innovation compared to 68 percent for basic users;
- Advanced API management users experience a 40 percent increase in customer satisfaction compared to 30 percent for basic users;
- Advanced API management users experience a 38 percent reduction in IT-related costs compared to 29 percent for basic users.
Effective API management: A roadmap
CA Technologies’ commissioned research leaves little room for doubt about the need for a sophisticated approach to managing the API lifecycle in the app economy. The study therefore closes with a series of recommended steps to help organisations improve their use and management of APIs:
- Define clear strategy in business terms
- Measure what’s most important
- Invest in the right talent
- Provide the right infrastructure
- Cultivate and nurture app developers
- Implement robust security
- Plan for scalability and performance
Download the full report