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“My advice is to start now, start small. Start doing something around this platform mindset shift, and get the right tools that help support it. The biggest challenge with technology is that your tech will work against itself. You get people all fired up and then take them down the wrong path because the tools were architected for a different time and era. Making the right kind of strategic investments and being willing to go down that road of transformational change to improve your digital experience."
– Charles Araujo, Publisher of The Digital Experience Report and industry analyst.
This week on the API Intersection podcast, we chatted with Charles Araujo, Publisher of The Digital Experience Report, industry analyst, and keynote speaker. Charlie has seen it all, from running large-scale transformation programs to authoring "The Quantum Age of IT: Why Everything You Know About IT is About to Change" to founding the Institute for Digital Transformation. This all makes him the perfect guest to dive into the bigger picture of how API technology is truly changing the world on a large scale.
His recent piece for CIO Online explores the experience economy, the ecosystem mandate, and how API design may be the key to competitive advantage. He explains how "to leverage the power of APIs to connect your ecosystem and deliver compelling experiences, and how you need to begin by taking a strategic and proactive view of APIs" to do it right.
What Digital Experience is & Why It Matters
"I think for some people, they think about your digital experience and assume this is about improving consumer access to your product. I fear that digital experience will have the same problem that 'digital transformation' did, which is holding on to that same misinterpretation," shares Charlie.
The idea of the experience economy goes back almost 25 years. According to Harvard Business Review, 'economists have typically lumped experiences in with services, but experiences are a distinct economic offering, as different from services as services are from goods.' Today, the experience economy is known as this fourth economic wave where consumers desire unique experiences. More companies are responding by explicitly designing and promoting experiences, building their entire foundation around how to best support that experience economy.
"My fundamental belief is that what we saw over the last decade was that throughout the industrial age, it was all about optimization and efficiency. Over the last decade or so, what we saw was this fundamental shift that those companies that we would all think of as disruptive were not, in fact, out optimizing their competitors," shares Charlie.
Those key disruptive companies are not successful because they are highly optimized but rather because they focused on transforming the nature of the customer experience. The winners shifted the power away from the company that previously dictated the engagement terms and into the customer's hands.
That customer-centricity rooted in your company's foundation will be a game-changer for your company's overall growth and success. And along with that, customer-centricity enables digital experience to ensure a smooth customer experience.
"So, when I talk about the digital experience, it's all about a shift in value where the lever of value creation in the enterprise is now the customer experience," shares Charlie.
However, Charlie emphasizes that the customer experience does not stand alone but is in fact, fed and supported by the employee experience and the ecosystem experience. The ecosystem experience embodies our ability to interact because no service that virtually any organization delivers can be delivered in isolation. It involves the surrounding suppliers, partners, community, and all of that coming together to produce a cohesive experience.
Where does Digital Transformation Fit in?
After all, Charlie explains that digital transformation is the output of that process. This means that we are shifting value creation to the customer experience, meaning that organizations must transform business operating and management models in a continuous loop to continually innovate around the customer experience. That transformation loop is impossible without digital technology such as APIs to support that transformation.
"The digital experience is this interwoven cohesive look at how all these parts have to fit together. And almost by definition, we need a platform or a set of platforms that enable that. So I talk about the XTECH market as this sort of ecosystem of technologies that support the creation, delivery, management, sustainment of the digital experience," shares Charlie. "But, when we're talking about delivering these cohesive experiences, over time, all that has to be interwoven integrated, and they can't be run in isolation."
Get the right toolset and technology to ensure a smooth digital transformation. APIs are one of those technologies that have the power to adapt, scale, and customize to the level that businesses need to keep up with the experience demand. APIs are central to both the experience and an organization's competitive posture because organizations no longer stand alone; they must be designed in a customer-centric fashion and play well with all other partners and communities within their ecosystem to truly deliver a valuable experience.
All Orgs Will Be Platform-Focused (Design-First Can Help!)
"I think every organization is fundamentally becoming a platform because they have to create this platform of connecting all of their partners, their employees, and their customers together to create exponential value. And so, that becomes the linchpin of all this coming together," shares Charlie.
Platform thinking is not actually a technical exercise; it's massively cultural and hugely dependent on the leadership of an organization to work well. Creating this level of platform thinking for your company intertwines nicely with what we like to call the design-first approach here at Stoplight and the broader notion of “API First.”
As a core part of our structure and foundation, the design-first approach helps you think about how to design the big picture of what you do as a business and how you relate to all the things around you (thus, platform thinking). Applying that design-thinking on a larger scale can help technology and business leaders understand how to organize this platform-level foundation around the digital experience and implement true transformation.
Charlie's piece in CIO states that "API design is rooted in the broader design thinking ethos. It combines an outside-in customer perspective with a comprehensive architectural view to establish a cohesive design modality."
In an API design-first development process, API architects begin with writing a specification and engaging all stakeholders in the process from its inception. The result of a design-first process is an API product that is comprehensive, consistent, and understandable by both collaborators and machines.
To enable this consistency and a platform-wide view of API design, many companies invest in governance processes, creating API design review processes that incorporate human review as well as automation to enforce standards.
Charlie's CIO piece explores "this understanding that API design is a strategic enabler of ecosystem-powered business outcomes is what demands executive-level focus."Ultimately, it's clear the experience economy is here to stay. Organizations can either get on board and arm themselves with the right technology to support it or risk losing out on a massive opportunity.
I appreciate Charlie coming on the show, and you can check out more of his insights on the Digital Experience Report website. As always, subscribe to the API Design blog or our podcast for more insights.