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Why use API for digitization in the automotive industry?
18 / 08 / 2017
The problems and trends in the automotive industry will force both car importers and dealers to change their business models. The progress of digitization is already shaping the directions for their technological development. The right approach to these changes will allow us to prepare well for the coming revolution, so it is a good time to consider establishing the foundations for an API Economy system. Here’s how it can help you to better brace for future challenges.
Problems in the automotive world today
The current trends in the automotive market require the development of new API-based services to provide data for various recipients. One important factor is how soon all the user groups, such as: importers, dealers and third-party companies, will need to be able to retrieve business data.
The lack of up-to-date information can lead to misunderstandings. For example, a dealer might, based on information from the previous day, offer a vehicle that the importer no longer lists.
The quality of API-propagated information is also important, with data coherence and uniformity becoming a key problem. Integration solution developers have to understand that any system already has information on the customers, suppliers and partners, which is often trapped in data silos and requires suitable merging and cleaning. Solutions to this problem include using Master Data Management (MDM) systems to create what is known as the Golden Record, the master representation of an entity, such as a customer, that has relations to other systems.
These challenges have been addressed by service providers such as Mulesoft and WSO 2, which offer a range of tools for API management. These solutions aim to ensure we can successfully manage our connection with data and other services. API Manager enables user management, as well as offering the monitoring and analysis of traffic within and outside the organisation’s environment. This makes it possible to publish, support and supervise interfaces in a safe and scalable environment. With solutions based on such a model, new services can be developed based on existing public and private services/APIs.
You can define APIs for specific recipients and for specific sets of the available data. With such simple interfaces, you can use powerful business application mechanisms and provide their corresponding information in real time. Using this model allows companies to choose APIs that are easy to integrate and which create new services for consumers in order to achieve business leverage. API Economy involves the commercial exchange of information resources. This could include actions consistent with API Economy logic, such as providing website information to another website, or enabling users to sign in to a dealer’s website using their account on the importer’s website.
Figure 1 Mulesoft’s support for the concept of API Economy (source: mulesoft.com)
Mulesoft’s API Strategy approach is consistent with the API Economy concept (Figure 1). It enables companies to develop both public API strategies that enable contact with customers via the Internet, mobile phones and social apps, as well as private ones to support dealers, partners or dealership employees. API Manager offers tools for user management, traffic monitoring and analysis, and ensuring API security in line with the organisation’s security policy.
By using an API that supports efficient communication between Dealers and Importers, we can expand it and apply it to areas that so far remain largely unintegrated. The network of potential connections (Figure 1) presents some areas suitable for API use. The automotive industry has seen increasing popularity for Connected Car solutions, which involve creating a separate ecosystem for providing a variety of internal services, such as repair and maintenance services or technical support, sent straight to the car. These services can also be used by external partners or dedicated solutions supporting vehicle analysis and diagnostics (e.g. Nebula). Vehicles can be a source of much interesting information for importers and users, and can provide additional services like:
– web marketing via a new communication channel
– dedicated in-car apps and automotive commerce
– fleet management support
Surveys indicate that these are the main directions of development in companies which are focusing on digitization (Figure 2).
Providing data also involves ensuring a high level of security for the same, so that each recipient obtains the right content, while new businesses and individuals can tap into the API. The solutions discussed here require appropriate security measures, high access speed and an easy way to connect devices or services with the car. These can be achieved with an API Gateway, which enables a secure connection for submitting details about the vehicle, e-commerce payments, customer profile and the car’s location relative to the manufacturer/importer. An API Gateway also includes functions for protecting the exposed APO from external risks and unauthorized access attempts.
With Anypoint API Gateway from Mulesoft, data can be made available outside the organisation. It provides a layer that ensures consistent security policies, specific per-customer SLAs (e.g. limits on the number of requests made within a given time) and uniform OAuth2 authentication. It also supports a range of security mechanisms and on-the-fly policy implementation.
Our experience with API
We have successfully built API-based integration solutions for our clients from the automotive industry. We offer support right from the start and help to solve any integration issues, creating a long-term vision for integration inside and outside the company. In stages we build the concept and implement the architecture, establishing the required foundations for integration and providing solutions that can be expanded to handle future integration projects.
We already create integration solutions for important processes at Volkswagen Group Polska. Having the right architecture for use with an API Gateway enables communication within the organisation and also outside of it. It also provides a consistent security policy for the exchange of data with external partners, SaaS platforms and mobile apps. With the right foundations in place, we are able to realise a vision of the future for other API-based solutions.
Thanks to the proven solutions deployed for our clients we understand how to make an effective approach to the API Economy model, and what elements are necessary to ensure high availability and security levels.
The main directions for change in the automotive industry require appropriate system support. To successfully confront the current issues within the perspectives of development, the right approach to the necessary changes must be employed. With the tools available on the market, the business model can be extended to gain a business edge.