Business Transformation: Reframing Strategic Advantage through APIs

Business Transformation: Reframing Strategic Advantage through APIs

Mohan Subramaniam

DevOps: API Management and Application Development

Carroll School of Management Boston College

Associate Professor of Strategy

DO3X101S

@emsub57

#CAWorld

Email: [email protected]

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Abstract

Business Transformation: Reframing Strategic Advantage through APIs

Competitive advantage has traditionally been deeply rooted in industry structure. But the growing importance of digitization and informational assets has blurred industry boundaries, driving businesses to operate in unfamiliar yet thriving digital ecosystems. And it’s the API that has provided businesses the building blocks to transform and compete in this new interconnected world. Join Mohan Subramaniam, Associate Professor of Strategy, Carroll School of Management and Harvard Business Review author, to discuss this paradigm shift from industries to ecosystems, the importance of informational assets vs. physical assets, and why APIs are key drivers for capturing value in this new digital marketplace.

Mohan Subramaniam

Associate Professor of Strategy

Carroll School of Management Boston College

Theodore Levitt’s famous question 50 years back … and his counsel to avoid marketing myopia

What business are you in?

What Industry are you in?

Steam engine industry?

Or the transportation industry?

What Business are you in?

Video rental industry?

Or something broader???

What is your Canvas for Strategy?

For several decades it has been our Industry

Competitive advantage is rooted in industry structure

Internal strengths (activities or capabilities) are the fundamental drivers of advantage

Growth through diversification or acquisition was usually restricted to opportunities closely related to core competencies

Deep Rooted Assumptions

Growing Importance of Informational rather than Physical Assets

Strengths come from external … not just internal sources

Rising significance of relationships with external actors

The rise of ecosystems where thousands of organizations can come together to share and co-create new value

And ...

The silent surge of APIs as a strategic resource

What is different?

The Transformational Powers of Digitization

See https://hbr.org/2015/04/are-you-using-apis-to-gain-competitive-advantage

Informational Assets are valuations are skyrocketing

Informational assets can create a platform to draw on external resources through APIs

The Upsurge of Complementors Vacation Properties

Taxi Services

See https://hbr.org/2015/06/corporate-alliances-matter-less-thanks-to-apis

Digitization allows for leveraging value from complementors at an unprecedented scale

Why Ally when you can API?

Opportunities from Technological Turbulence

Complementors do not remain stable

Unprecedented pace of change in complementarities

APIs provide flexibility of partners and fluidity of business goals

See https://hbr.org/2015/06/corporate-alliances-matter-less-thanks-to-apis

AppleTwitter

Intel

Microsoft

IBM

Google

Sony

Paypal

Netflix Amazon Samsung

AT&T

Facebook

Adobe

Ted Levitt’s famous question 50 years back has a new meaning today …

What Ecosystem are you in??

And the Key to That Answer ...

is in APIs!!

Unlocking the Strategic Potential of APIs for Ecosystems

Intra-firm Interface

Ecosystem Interface

Supply Chain Interface

LeveragingInternalCompetencies

LeveragingExternalCompetencies

Growth

© Iyer and Subramaniam

Informational Assets For Service Variety

Low High

Low

High

Info

rmat

ion

al A

sset

sFo

r D

om

ain

Var

iety

HybridEcosystem

Value Chain/Alliance

Ecosystem

Domain VarietyEcosystem

Service VarietyEcosystem

High Reliance onPhysical Assets

High Reliance onInformational Assets

High Reliance onInformational Assets

Number of complementors

Nu

mb

er o

f co

mp

lem

ento

rs


Shaping Ecosystem Strategy Through APIs

Driving an EcosystemStrategy with APIs

Collect

Share

Act


• Digitization is transforming industries into ecosystems

• In ecosystems, significant growth opportunities come from leveraging external resources

• APIs can power the harnessing of such external strengths and drive greater growth opportunities

• APIs allow firms to extend their traditional assets into informational assets and facilitate the construction of Industrial Platforms.

• Such API enabled industrial platforms empower firms to grow far beyond the contours of their internal core competencies.

• Firms can unlock the potential of APIs in 3 levels

• At they third level APIs shape a firm’s ecosystem strategy as domain variety, service variety or hybrid ecosystems

• APIs power this strategy through 3 gears: collection at the edge, peer to peer sharing & learning/decision making

Summary

• How much is digitization already impacting your business?

• How fast and how significantly do you think digitization will impact your business?

• How high is your reliance on your current traditional or industrial assets?

• To what extent have you extended your traditional/industrial assets into informational assets?

• At what level are you using APIs?

• What is the current shape of your ecosystem strategy?

• How well are your APIs powering the 3 gears driving your ecosystem strategy?

Key Take Away Questions


Q & A


Recommended Sessions

SESSION # TITLE DATE/TIME

DO3X98SCase Study: Unum Group Shares Lessons Learned from

Four Years of Implementation Success in API

Management

11/19/2015 at 2:00 pm

DO3X97SHome Under Siege – How APIs Will Secure the Internet

of Our Things11/19/2015 at 3:45 pm

DO3T30TTechTalk: Unlock the Value of APIs through Direct and

Indirect Business Models with CA API Management11/19/2015 at 4:30 pm


Must See Demos

Unlock the Value of APIs

API Developer Portal

Theater 3

Build Digital Ecosystems

Internet of Things

Theater 3

Accelerate Mobile/IoTDevelopment

Mobile App Services

Theater 3

Extend Existing Architectures

API Gateway

Theater 3


For More Information

To learn more, please visit:

http://cainc.to/Nv2VOe

CA World ’15

http://cainc.to/Nv2VOe

http://bit.ly/1wbjjqX

Business Transformation: Reframing Strategic Advantage through APIs

Technology

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