APIs are enabling an unprecedented flow of innovation


On Tuesday I had the great pleasure and honor of doing the opening keynote at the APIDays Sydney conference, the first API (Application Programming Interface) conference in Australia, excellently organized by Saul Caganoff of SixTree.

APIDays was founded by Mehdi Medjaoui in Paris in 2013, has since been run in Barcelona, Berlin, San Francisco and now Sydney, with the event in Paris last year attracting 800 delegates.

Below are the slides for my keynote on The Flow of Innovation. As always, note that my slides are designed to support my presentation and not to stand alone, but still may be of interest to people who did not attend my keynote.

In my keynote I noted that in a world in which we are moving towards a truly fluid economy, driven partly by powerful twin technological and social trends towards openness, networks are at the heart of everything.

Business innovation can be applied across five domains: product or service, marketing, process, organization, and business model.

APIs can dramatically enable innovation in each of those five domains, and I gave a number of examples of each. However the most important impact is at the organizational and business model levels.

In my book Living Networks I wrote:

In today’s world of blurring boundaries and increasing ambiguity, organizations are nothing more than vehicles for creating and appropriating value. In a capitalist world, shareholders own the legal entity called the company. The managers of the company apply its financial and other resources — in combination with other organizations — to create value that end-customers are prepared to pay for. They also must negotiate terms of engagement with other companies so that they can extract a fair share of the value created by the firms working together. The key difference in thinking from previous conceptions of the organization is that value is created by the network, not by the organization. The art of management is now about positioning the firm to extract value from its participation in a broad economic network.

APIs are a means to open out the organization. They are a fundamental tool to enable value creation across organizational boundaries.

One of the reasons I loved being part of the APIDays conference is that everyone involved in APIs has an implicit understanding of the importance of transcending boundaries. These are not people who are perpetuating existing systems, they are enabling new structures for value creation and organizations.

Innovation has become a flow, and must be a flow.

There are critical strategic implications of APIs and of adopting more open and flexible configurations of organizations, that must be on the agenda of the board of directors. Governance must be undertaken an enabler of innovation and value creation as well as of risk control.

The potential is to drive innovation, growth, competitive advantage, and massive success.