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In 2016, B2B integration API strategy becomes a priority

Patterns in technology changes and business process transformation suggest that 2016 will be the year when APIs for B2B integration become critical. George Lawton explains why.

Enterprises are turning to an API strategy to drive B2B integration. Read on for tips to address the numerous challenges...

related to supporting legacy protocols, streamlining business processes and leveraging third-party data.

API gateways promise to streamline B2B integration, but enterprise architects need to address a number of challenges to make things work smoothly.

Both emerging and established businesses are enabling partnerships by offering access to their B2B API services. "For developers and enterprise architects, this means opening up internal business processes for external consumption, and the creation of middleware to connect consumers with providers," said Owen Garrett, head of products at NGINX Inc., based in San Francisco.

Security concerns will also mean enterprise architects need to begin to compartmentalize monolithic applications and business processes to isolate the hardened, secured external-facing interfaces from the sensitive internal systems. Monitoring and reporting is critical to the business -- both to measure compliance with service-level agreements, and to provide input to billing and metering processes.

Move to utility compute model with APIs

"The most interesting trend around B2B modernization and integration relates to how IT shops are transforming to infrastructure that supports a utility compute model," said Mark Lewis, CEO at Formation Data Systems, based in Fremont, Calif. This allows organizations internal and external access, and provision resources via open, REST-based APIs, which enable the initiation of application compute and storage resources to be deployed on demand in a fully orchestrated, automated fashion.

One challenge in 2016 is how to transform manual processes into API-automated workflows, Lewis said. Another is how to migrate applications off of rigid, monolithic infrastructure to dynamic software-defined infrastructure in a secure manner, with the proper data governance controls in place. The most interesting development in 2015 around B2B integration was how the public cloud platforms embraced B2B integration and have built a broad set of services to support this capability.

Legacy integrations still important

Having a B2B integration API strategy is increasing and slowly overtaking more traditional integration methods. However, traditional protocols, such as AS2 or AS3 file-based integration, are still alive and will not disappear anytime soon.

"This calls for software solutions [that] can support the legacy integration models, while proposing new ways of integrating, such as APIs, event-driven integration or via messaging systems. Customers can then slowly switch over their partners to new integration channels," said Isabelle Mauny, vice president of products at WSO2.

APIs just the beginning

The simplification of integrations is shifting the business conversation. "Using technology, like APIs or webhooks, makes integrating two disparate systems significantly easier, but developers still have to program and manage those services, which, for enterprises, can be a big undertaking," said Neil Mansilla, vice president of developer relations at Runscope Inc., based in San Francisco.

Companies such as Zapier and IFTTT are proving themselves as useful players in the space as middlemen between organizations and the third parties with which they want to integrate. Mansilla said these services are transforming the integration space, allowing companies who can't invest in the technology, but need to partner with other organizations, do so easily and affordably.

Additionally, many newer companies are building their business as platform-first, creating hubs that put integrations with sometimes hundreds of services as a key offering of their product. Users can add integrations they need with the services they use in just a few clicks. 

"As B2B integrations become more popular and vital to business, more services will crop up that facilitate complex integrations, and more companies will build out integration platforms to lower the barrier to entry for partnering," Mansilla said.

Healthcare moves toward API integration

Improvements in security and privacy infrastructure could also help to bring more B2B integration in the healthcare industry. WSO2's Mauny has seen increased demand for AS4 and FIHR -- in the healthcare industry -- and said she expects this to continue in 2016.

Today, many professionals in this space are still using Excel or fax to share data and information. The integration of carrier and provider data is already enabling a completely new set of services to address the $375 billion the insurance industry spends on paper-based data exchanges.

"As we begin to really feel the benefit of this integration in 2016, we'll see API-powered data integration become the norm instead of the exception in this industry," said Jason Andrew, CEO at Limelight Health.

Think of the network as an integral part of B2B strategy

Businesses are increasingly rolling out cloud-based or Web-based portals to enable effective communication with their customers, suppliers and partners. The rationale behind putting a Web front end on these applications is that end users can easily access them from any browser or from multiple devices. As user experience is one of the key performance indicators determining the success of B2B integration, it is crucial that these Web portals and applications do not suffer from sluggish performance.

The network should become an integral part of an organization's larger B2B integration strategy. "Enterprise architects should evaluate [content delivery network and software as a service] acceleration solutions to ensure application performance, and factor them into the strategy," said Gary Sevounts, chief marketing officer at Aryaka. If customers, suppliers and partners are globally distributed, a global private network with built-in optimization is crucial for success. A slow network can cause B2B integration initiatives to fail, especially if customers, suppliers and partners are based in remote locations, such as China.

Embrace new opportunities for old B2B integration standards

With 2016 bringing an explosion of APIs, we'll see new opportunities for the old set of B2B integration standards.
Ken YagenVP of products at MuleSoft

Traditionally, B2B exchanges are expensive for customers to maintain. "With 2016 bringing an explosion of APIs, we'll see new opportunities for the old set of B2B integration standards," said Ken Yagen, vice president of products at MuleSoft Inc., based in San Francisco. API-led connectivity will allow organizations to tie together new software as a service and mobile applications with traditional B2B protocols and standards required to connect to partners. Yagen said he also expects more initiatives to appear, like the Directive on Payment Services that mandates standardized API access for payment services across the EU.

Companies will now be able to build reusable services across multiple B2B trading partners and B2B processes on a single connectivity platform. "This increases agility and decreases time for partner onboarding, while reducing cost and risk. APIs provide the gateway and visibility to integrate B2B exchanges that allows organizations to operate in a more efficient manner," Yagen said.

Integrate third-party data into business processes

In 2016, organizations will use more and more third-party data to drive business processes and decision making. However, integrating these data new sources across an organization's partner ecosystem is difficult, and puts pressure on legacy data management systems and processes. "The structure of these sources is beyond an organization's control and can change unexpectedly. These changes, called data drift, can corrupt data and break data operations. How organizations modernize to deal with data drift will be an important theme in 2016," said Arvind Prabhakar, CTO, StreamSets, based in San Francisco.

Cross-business flows of unstructured and semi-structured data are proliferating. This proliferation creates real problems for organizations. For instance, data engineers and scientists spend too much time cobbling data flow services together instead of pushing their organizations' data practices forward.

"Organizations that free up their data engineers and scientists to focus on furthering data practices will be able to cost-effectively create and maintain reliable and high-quality flows that support critical business decisions," Prabhakar said.

API gateways become the new storefront

B2B integration is rapidly evolving to digital business, as legacy integration methods, such as EDI, ESP, and ETL, are being replaced by a new breed of public API gateways.

"Just as every company today has a website, every company will have a B2B API gateway,"said Ilan Sehayek, CTO at Jitterbit. "The companies that develop an integrated B2B API strategy ... will become the industry disrupters in their markets."

The greatest challenge will be cutting through the hype of the API marketplace to deliver real value to their partners. Too many B2B API projects require custom integration to achieve measurable return on investment, and APIs alone are not enough. According to Sehayek, business will need to implement a "hybrid" B2B API strategy that includes both existing and developing services.

"APIs will continue to evolve in 2016 to connect even more of the enterprise," Sehayek said. "Companies should be prepared to build out their API strategy with a greater focus on the end-to-end business process being exposed and according to Agile development principles."

Next Steps

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