How To Explain APIs To Your CEO


Adrian Bridgwater, Contributor

December 3, 2015

But really now, can we honestly expect C-suite executives to take an interest in Application Programming Interfaces (APIs) today? Here’s an argument for why the answer could be yes.

Ten years ago very few non-techies were comfortable with the term ‘applications’. But thanks to the arrival of the iPad and the ubiquitous nature of the smartphone, we’re all quite used to ‘apps’ as we now snugly call them. In ten years from now, the API could enjoy similar status — so here’s why.

What is an API?

In terms of definition, APIs connect pieces of software together. They ‘glue’ together any required information components around a system and are often ‘released’ to third-party programmers who will want to connect application elements and services together.

As software becomes an increasingly componentized, containerized intermix of cloud-based services, the API rises upwards as a key to opening this promised land of digitization that firms are so keen to achieve.

“We must embrace disruptive transformation and become a data-driven business empowered by big data and analytics,” said the generic technical evangelist commentator from xyz company.

Software testing, monitoring and automation tool company SmartBear argues that APIs have become mission critical i.e. they enable third party users to connect to electronic services coming out of your newly digitized business, so you need to make sure your APIs work effectively and are accessible, if you want to be open in the first place that is.

How much is my API worth?

Here’s a nice example that comes from a SmartBear Infographic on this topic.

  1. Let’s say that your firm has built an application to serve your customer/users.
  2. Let’s also say that your firm’s application needs to provide a geographic reference tool of some kind that uses Google Maps (this could be for ‘find my nearest branch etc.) for customers.
  3. If your application makes 25,000 daily requests to the Google Maps API then the good news is that the first 2,500 requests are free.
  4. After that, calls to the Google Map cost US$ 0.50 per 1,000 requests.
  5. This would mean that 25,000 daily requests x 365 = US$ 4,380 per year.

“[What firms may now want to consider is that] your API is worth the cost that each of your users would incur were each to have to create the service themselves divided by the number of competitors in your space +1, dividing your user count by 10,000,” argues SmartBear.

Whether you follow all the math or not, we can start to see that APIs are an important route to interconnecting various business functions. We may be some way off the CEO or COO asking “how much is our API costed out at?” during a board meeting… but for the digital natives driving the new breed of digital data-driven business, this does not actually sound like a radical question to pose.

Does a CEO now start to care about APIs? Well, a bit, surely.

As Forbes contributor Dan Woods wrote only recently, “In a larger sense, APIs are the secret sauce to becoming digital, that is, to transforming business so that innovation can happen at a faster pace, so that barriers to change are reduced, so that many more people can contribute to your company’s success, and so that you can create better products and defend yourself from the competition.”

We’re on a mission

Admittedly this story is part of a mission — a mission to talk more openly about the mechanics of software as it now touches so many of our day-to-day experiences.

If some extra insight is gained by knowing what these component parts do and how they work… and that leads to someone doing something innovative (or simply just being more productive) with the software we all use everyday, then it was worth the ride.

This article was written by Adrian Bridgwater from Forbes and was legally licensed through the NewsCred publisher network.

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