Healthcare is hardly unique in this regard. Smart buildings, smart cities, smart homes, and smart highways—right down to the tires—all flourish when great products become ingredients in connected experiences. In the API economy, your IoT offering needs early partners before it can have early customers.
“In healthcare, it’s an API economy. Success in the API economy requires you to think Big and Small, where Big means understanding value creation and exchange within large, interconnected systems, and Small means recognizing what components of your product are unique and abundant to you, and also can become valuable ‘ingredients’ to the products of others.”
— Florin Fortis, Head of Digital Strategy & Innovation at Humana.
“As we explore new solutions and business models, that necessitates new kinds of relationships. Blanket partnering policies are often irrelevant and onerous, but starting from scratch on each opportunity is too slow. It requires clear business model principles and just enough flexibility to get these early collaborations started.”
— Abhijit Ganguly, Senior Manager of Incubations & Deployment at Goodyear.
IoT Business APIs: Moving from Products to PlatformsAt the center of these collaborations, you’ll find three magic letters: A.P.I. The API (short for application programming interface) is a set of (hopefully) simple and transparent rules that enable complex technology stacks to work in concert and adapt to change. At their best, good technical APIs can help products become platforms. There are actually unheralded business APIs, too, with equal power to determine how your solution scales and adapts to change. Using APIs offers several benefits:
- They reduce time-to-market (TTM) by enabling simultaneous development
- They foster robustness by enabling experimentation with multiple variants
- They maximize reusability by creating strong, specialized components
Interoperability Is the Future of IoT Business ModelsTo understand the crucial role of business APIs, consider the recent evolution of IoT. In our experience as an IoT practitioner, we’ve gleaned a few common principles, which we’ve tabulated below.
|Every atom that can be augmented by a digital bit will be||If you don’t launch an IoT solution in your domain, someone else will|
|When you combine a product and a service, you get a service||Plan for a service-dominant solution; design service-ready products; make everything ready to be externalized|
|Value chains are brittle; value networks are resilient||Make your IoT components as open as possible so that others to join and make money|
|Data isn’t oil; it’s sunlight||Use data as a source of energy: available to all collaborators within your value network to strengthen their IP|
|APIs are stronger than Ts & Cs||Create technical and business APIs that are simple, transparent, and multi-tenant; make exchanging business value as easy as exercising an API|