In part one of this blog series, I introduced the different ways reusable integration assets can be valuable. Here I’ll provide a simple framework for assessing the projected return on integration assets (ROIA), which can help inform how your organization prioritizes integration development.
Note that there are various sources of value that a reusable integration asset can create, however, this framework will focus on the value opportunities that stem from development and maintenance efficiencies. To learn about other sources of value, such as monetization potential, impact on customer experience, etc. see our related whitepaper.
The framework for calculating ROIA, an example
Two ways to measure
Note that there are two ways to measure the value of a reusable asset from a development and maintenance perspective. In the above example, we use method No. 2:
No. 1: Compare API-led approach to non-API-led approach
With this method, you calculate a “comparative” value by measuring the cost difference between developing and maintaining an integration asset using a custom, point-to-point approach to that of an API-led approach. Essentially, you are calculating “x – y”, where “x” = cost to develop/maintain integration without API-led approach and “y” = cost to develop or maintain integration with an API-led approach.
For example, let’s assume the cost of development and maintenance for a non-API-led approach is $10,000 (x), while the cost for an API-led approach is $5,000 (y). To find the value of this asset, subtract x from y ($10,000 – $5,000) to get $5,000.
No. 2: Identify cost of API-led approach
With this method, you calculate an “absolute” value by only looking at the actual cost to build and maintain an integration asset using an API-led approach. In this case, you determine “y”, where “y” = cost to develop/maintain an integration with an API-led approach.
For example, let’s assume the API-led approach costs $5,000 to build and maintain. The value of this asset is $5,000.
This post should help you assess the value of your integration assets, drive an optimal ROIA, and help inform your integration development prioritization. In my final blog post of the series, we’ll review a case study of how a U.S. high-tech company used this framework to generate significant value from reusable integration assets.