Companies Eager To Expand Digital Business Learn Value Of The Once Obscure API

Like a growing number of firms, Pilot Flying J, as the company is known, turned to application programming interfaces, or APIs – pieces of software that enable apps, platforms and systems to connect with each other and share data. They are the glue that makes digital platforms possible, allowing an app to connect to an operating system, a cloud, social or productivity platform or another app.

Tyler Tanaka, director of digital, loyalty and innovation at Pilot Flying J. Tyler Tanaka, director of digital, loyalty and innovation at Pilot Flying J. Photo: Angus Loten / The Wall Street Journal

“We had all this disparate data in silos and homegrown systems that we were trying to get to talk back to the app, and realized that we were really hamstrung,” said Tyler Tanaka, director of digital, loyalty and innovation at the Knoxville, Tenn.-based firm.

Using nearly a dozen APIs, developed by MuleSoft Inc., the company was able to share data among customer-loyalty programs, public-location information systems, and tools used for parking reservations, payments and other tasks, Mr. Tanaka told CIO Journal.

It launched the parking app in December.

Once considered the duct tape of enterprise IT, the use of APIs has grown rapidly in recent years, as closed networks give way to open platforms. Microsoft Corp., less dependent on its Windows operating system, now relies on APIs to make its applications available on other platforms, such as Apple Inc.’s iOS.

Similarly, companies increasingly are signing on to multiple cloud providers with diverse platforms and infrastructure, taking an a-la-carte approach to business software, rather than rely on a single tech vendor.

Together these shifts are pushing the value of APIs to new highs. San Francisco-based API maker MuleSoft was acquired in March by Inc. for $6.5 billion, the business-software giant’s largest acquisition to date.

Keith Block, Salesforce’s president and chief operating officer,told CIO Journal that the move was driven by a “fair bit of anxiety” among corporate customers over the need to integrate data from legacy software with newer systems, cloud platforms and other emerging digital tools.

“Everything hinges on being able to unlock and use all this data, which lives everywhere,” said MuleSoft Vice President Ross Mason, who founded the company in 2006. He describes the buildup of data locked inside legacy IT systems as a “big ball of mud.”

Last month, more than 4,000 chief information officers, senior IT managers and developers attended MuleSoft’s annual API conference in San Jose, Calif., up from a few hundred just five years ago, organizers say.

Gartner Inc. estimates that by 2020 more than 75% of businesses will have multiple delivery and operating systems running their digital business tools. By then, it says, 50% of these businesses will have a full-time manager in place to oversee the network of APIs necessary to integrate these diverse systems, up from 10% today.

“APIs are woven into the very fabric of digital business,” Gartner researchers said in a report in April, adding that the “widespread usage of APIs will increase massively in the future.”

Fueling that growth is the broader strategic value of APIs: Enterprises employing them are finding that data unlocked from core systems can be used to drive new business models.

Mulesoft said one customer, consumer goods giant Unilever PLC, has used APIs to connect data from its legacy systems with new e-commerce apps, effectively cutting out third-party channels and selling its products, such as Dove soap and Hellmann’s mayonnaise, directly to consumers.

Sovan Shatpathy, Amtrak’s chief technology officer, said he relies on APIs to make customer services work seamlessly among online and mobile apps, ticket kiosks or station attendants..

“With APIs all of my interaction channels now share customer data,” Mr. Shatpathy, who spoke at MuleSoft’s annual conference, told CIO Journal in a separate interview.

Mr. Tanaka, of Pilot Flying J, said the company’s IT integration took nearly three years to complete, a result of complexities built up over decades as the company grew by mergers and acquisition, and accumulated “technical debts” by layering on different IT systems.

“Bringing all these systems together into one nice easy-to-use, easy-to-manage scalable system, that is our tomorrow,” he said.

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Companies Eager to Expand Digital Business Learn Value of the Once-Obscure API
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