The preliminary results of API-led connectivity are in. Businesses that have deployed the traditional three-layer architecture now have a few years of experience to share, related to cost to build and maintain, time to market, and overall readiness to lead with APIs versus other strategies.

If you are considering how to modernize your connectivity and automation strategy, you have probably heard about API-led Connectivity as an architectural style and integration platform as a service (iPaaS) as a foundational platform for creating an integrated digital framework. But understanding where to start may seem daunting — and in that, you are not alone.

So, where do you start? An architectural style leading with APIs — or a platform that focuses on a unified set of integration components (including API management.) First, we must understand what API-led connectivity means, and if it’s the right choice for your business.

What is API-led Connectivity?

When executed properly, API-led connectivity is a strategy that makes all software assets consumable through application programming interfaces (APIs) so that future applications can be assembled from reusable API-accessible software services. The traditional API-led connectivity strategy calls for a multi-tiered library of software services accessible on top of the native APIs for services calling business applications such as SAP, Workday, Salesforce, Oracle NetSuite, and many other SaaS and legacy data sources.

Is API-led Connectivity Right for Your Business?

An API-led connectivity strategy can work well when future project needs are predictable enough for the IT organization to accurately forecast the reuse of APIs. If reuse is high, the ROI for investing in APIs upfront is also high. If reuse is low, then the upfront time and cost to add the three additional API layers can result in a heavyweight foundation that delays and complicates the transition to digital transformation.

Traditional API-led connectivity adds the following three layers of APIs:

• Experience APIs, which lie directly underneath the user experience interface such as a mobile device, IoT, desktop app, etc.
• Process APIs, which provide access to custom business logic and data transformation as well as aggregating APIs from the System API layer.
• System APIs, which provide access to applications, databases, and other data sources.

Challenges With API-led Connectivity

A recent survey conducted by Cascade Insights of more than 150 companies that deployed software based on the three-tiered API-led connectivity strategy found that the top two reasons why companies were considering alternatives to their API-led connectivity software vendor were: “Cost is higher than anticipated” (48 percent) and “Our organization was not ready for API-led integrations” (41 percent.)

Some early adopter businesses are finding that their three-tiered API-led connectivity strategies are not paying off. For example, a leading auto manufacturer recently abandoned its multimillion-dollar investment in API-led connectivity after finding that:

• Fewer than 40 percent of APIs were being reused. Most of the APIs the company had built and published were sitting idle and not reused for additional purposes.
• Almost 500,000 lines of additional code were required. Despite being unused, the APIs still needed to be maintained and after deploying nearly a half-million lines of code, the cost and effort was significant.
• Over $1 million in costs were incurred before the manufacturer transitioned away. Despite substantial investment of software and consulting costs, the company still didn’t have the integrated digital framework it needed.

Although some level of foundational integration APIs can be very useful, building an entire API-led library independently from the other integration components such as EDI, data catalog and preparation, application and data integration, and master data management, with the intent of significant future reuse, can be costly and risky.

A New Paradigm to Support Digital Transformation

As the expectation for delivering digital transformation results has steadily dropped from years to months to weeks — and sometimes days (as experienced during the pandemic), forecasting future reuse has become more difficult. For a growing number of companies, a different strategy is needed. One that is less dependent on predicting future needs and more agile and ready for growth in any direction the business may turn as the demand for instant flexibility continues to grow. An integration platform as a service (iPaaS) may fill this need.

Download the white paper “Simplifying API-led Connectivity with a Modern Integration Platform” to learn how an iPaaS can help you launch your intelligent connectivity and automation initiatives for digital transformation.