What Apple’s App Store can teach us about digital transformation

When the iPhone launched in 2007, Steve Jobs didn’t want the device to include native third-party apps. Originally, Jobs wanted developers to create web 2.0 and Ajax apps with modern web standards that could integrate with iPhone services. It failed to take off, and Jobs corrected course within four months.

Fast-forward a decade and the repository of native third-party apps in Apple’s App Store has reached 2.2 million, driving over $70 billion of revenue for its global developer community and $8.5 billion for Apple itself. The success of the App Store in large part is due to the ease it affords our professional and personal lives. Whether we want to check the weather, book a workout class or review our calendar for the day, we all have come to assume, “There’s an app for that.”

This powerful mindset shouldn’t just be reserved to smartphones – it should be applied to IT to help businesses move faster. Imagine a central repository – much like Apple’s App Store – exists within organizations. Instead of looking for apps, it is a place where we can find enterprise assets and capabilities. For example, analysts can find Tableau data sources for sales insights, developers can find customer data for use in mobile apps, HR can set up simple synchronization jobs between systems to manage employees, IT teams can quickly modify employee onboarding processes as new apps get introduced in the organization, and integration developers can find a connector to a preferred SaaS or legacy provider.

The digital building blocks are there for us to self-serve: to easily discover, reuse and expand upon. Built on top of APIs, they are packaged in a way that we only see the information we have access to and that make sense for our function. Additionally, the building blocks come with ratings and reviews, so the best bubble to the top while the worst fade away. The more building blocks added to the repository, the more its value grows and the faster business outcomes are delivered to meet ever-evolving consumer expectations.

To drive self-service, we need to shift our thinking to assume, “There’s an API for that.” The web has shown us how powerful this is. Every app on our smartphones uses at least a handful of the 18,000-plus open APIs on the web, so app developers don’t need to build their own maps, image recognition capabilities, AI processing engines, payments services and more. While many applaud the App Store as the reason for the iPhone’s success, it is really owed to the ecosystem of web APIs that are used to support the millions of apps in the App Store. 

So what can we learn from the App Store’s meteoric success, and how can CIOs bring these learnings into today’s modern enterprise to drive digital transformation?

It starts with a mindset shift

As the App Store teaches us, it’s powerful to have a default mindset that what we need already exists and to then have a central marketplace to go to and discover it. It prevents us from resorting to outdated methods or building from scratch. Yet, most teams within organizations are not used to thinking in this way and almost always work in silos. As such, it’s critical for CIOs to take charge in fostering this new culture of self-service both in IT and the business.

CIOs can start in two ways. First, CIOs should change how IT building blocks are created. They should encourage, and sometimes even mandate, teams build assets in widely consumable ways versus one-off efforts. Amazon CEO Jeff Bezos certainly took this approach through his infamous mandate, where he forced internal development teams to share data and functionality through reusable, externalizable APIs. Amazon’s agility and success today speaks for itself.

Second, CIOs should drive teams embarking on new projects to first and foremost ask, “Have parts of this project been built before, and can I reuse those components? If so, where are they?” By aligning development teams with this new mindset and internal API plan, a strong bank of reusable, externalizable building blocks will grow into a powerful application network, allowing CIOs to decentralize IT and empower the business to move a lot faster.

The power of an enterprise marketplace

As the self-serve mindset is being adopted, a marketplace for discovery and consumption needs to be set up. It will start small and gradually build over time like any of today’s formidable networks. Yet, it’s the CIO’s responsibility to kickstart it.

The aim in setting up an enterprise marketplace is to ensure the wider business can do more on its own, without relying on central IT for each project. This includes opening up API access to broader application development teams while keeping central IT in charge. The key for the marketplace is not centered around how many assets are made available, but rather how many assets are being reused to add broad value. Because every time an API is reused, it saves time and resources that can be put to work elsewhere.

One of the CIO’s biggest responsibilities when setting up an enterprise marketplace is to ensure a close alignment between the IT organization and the overall needs of the business. The alignment will determine what assets to invest in to efficiently execute critical business initiatives. Splunk’s CIO Declan Morris, for example, works closely with Splunk’s business leaders to ensure his team is supporting the company’s vision. According to Morris, “As a team, IT can reverse engineer from that viewpoint and can critically look at what the business needs are to drive greater value rather than becoming a choke point – the worst outcome for any CIO.”

How companies are adapting across industries

With today’s technology capabilities, any company can become a disruptor – no matter how large or small. Industry behemoth Wells Fargo, for example, is responding to pressure from fintech startups by using APIs to decouple its existing, monolith platform into smaller, reusable components. Now, the more agile bank can rapidly integrate recent acquisitions and reduce application development cycles from six to three months.

Additionally, hospitality disruptor Airbnb wove its company together with an API strategy. It didn’t build from scratch its own mapping engine, billing engine, customer database or customer management system. Instead, Airbnb discovered and leveraged these services from other providers to scale very rapidly.

Global athletic footwear and apparel company ASICS, on the other hand, is using an API strategy to help unify its seven global brands onto one platform and build more personalized customer relationships. By turning critical business data – such as real-time inventory, pricing and order statuses – into reusable APIs, ASICS is building an application network that allows for new applications to be rapidly composed at a global scale.

CIOs are in a powerful position, capable of turning any organization today into a disruptor with the right internal strategy. The CIO has a critical role to play in not only guiding the IT organization into building assets with reuse in mind, but also in teaching the rest of the organization how best to self-serve these assets to drive the company’s vision forward. It’s a top-down strategy reliant on an airtight partnership between IT and business leaders, and the CIO is responsible for putting the strategy into motion.

In the same way Apple’s App Store bred a culture of self-service on our iPhones, enterprise marketplaces too can breed a culture of self-service around IT assets with the right champion in place. That champion is you.

(Disclosure: Splunk, Wells Fargo and ASICS are customers of my employer, MuleSoft.)