Ring-Fencing APIs: Modernizing Legacy Databases

Learn how you can modernize legacy databases and digitally transform your business through the power of APIs.

Introduction

Many businesses are now in possession of more data than they know what to do with. While this might seem like a blessing in disguise, it’s also a dangerous place to be for companies who make the mistake of resting on their laurels. A great deal of business strategy now depends on efficiently and effectively processing and analyzing the information at your disposal, uncovering hidden data-driven insights.

While new enterprise data is generated on a daily basis, companies also can’t afford to overlook the information locked away in legacy databases. The term “legacy database” typically refers to a method of data storage that is no longer a best practice in use at the organization.

Despite their outmoded nature, legacy databases contain valuable information and serve an important purpose—like the ancient junker in your garage that you still need to use from time to time. However, many organizations struggle to accommodate and integrate their legacy databases into the rest of their IT workflows.

According to a survey by Hitachi Consulting, 90 percent of IT decision-makers say that their legacy systems are holding them back from getting the most out of their digital technologies. What’s more, 44 percent of respondents at large companies say that their legacy systems have a negative impact on “every or most projects.”

The question then becomes: how can organizations make the best use of their legacy databases already in existence, while minimizing their impact on digital transformation initiatives? For a growing number of companies, the answer is APIs (application programming interfaces). In this article, we’ll discuss how businesses can work to modernize their legacy databases by making the information within them accessible via an API.

Table of Contents

• Why Should You Modernize Legacy Databases?
• APIs and Digital Transformation
• APIs and Legacy Databases

Why Should You Modernize Legacy Databases?

For many organizations, it’s all too tempting to rip out your legacy databases and start fresh with the latest cutting-edge technology. However, this is an unviable prospect for a number of reasons. In many cases, the data contained within legacy databases is business-critical information—or else the database itself would have been a casualty of technological obsolescence long ago.

The banking industry, for example, is well-known for its challenges with legacy databases and other systems. Aging IT infrastructure, in combination with external pressure from competitors and customers, has put many retail banks between a rock and a hard place in terms of technological constraints. For many of these institutions, legacy databases are like a partner that you can’t quite bring yourself to break up with, offering stability and predictability but not right for you in the long run.

However, it’s without question that legacy systems are hampering many companies’ best efforts at digital transformation. According to MuleSoft’s 2018 Connectivity Benchmark Report, 42 percent of organizations include legacy infrastructure and systems among their three greatest digital transformation challenges.

A recent survey by Couchbase of digital transformation leaders paints an even more dire picture. 88 percent of these leaders have seen a project fail or suffer problems with time or scope due to difficulties with their legacy database. What’s more, a full three-fourths of them lean so heavily on their legacy databases that they’re unable to adopt newer database technologies at the speeds they would prefer.

It’s clear that something must be done about these legacy databases, beyond allowing their mere existence to complicate digital transformation initiatives. Yet trying to replace legacy databases in situ is like trying to fix an engine while the car is driving down the highway. For many companies, legacy databases are literally an irreplaceable part of their business operations.

Due to these challenges, many companies are choosing not to replace their legacy databases, but to make accommodations for them as they live out their old age. In particular, there’s one technique that we’ll investigate in this article: the use of APIs with legacy databases.

APIs and Digital Transformation

The humble, undersung API (application programming interface) is one of the building blocks of the digital revolution. APIs are formalized channels that define protocols by which different applications and systems, created by different developers, can nevertheless exchange information in a simple and standardized manner.

It’s difficult to overstate the importance of APIs for digital transformation initiatives. APIs allow third parties to rapidly plug into a data source, and then unplug once they’ve retrieved the information they require. The two parties don’t need to know anything about each other or about the underlying data source; all they need to agree on are the terms of communication as defined by the API.

Thanks to the many benefits of APIs, including flexibility and rapid innovation, businesses of all sizes and industries are hoping to achieve the ideal of being an “API-driven enterprise.” Research and advisory firm Forrester has found that companies that use APIs externally are almost three times as likely to see revenue growth of at least 15 percent. Forbes magazine and other tech commentators have speculated about the “API economy,” or the vast set of interconnected APIs that foster new ways of engagement with business partners, vendors, and customers by sharing information.

APIs are a key enabler of digital transformation initiatives, unlocking new possibilities, partnerships, and sources of profit. They enable you to define a set of high-level communication standards so that data is always exchanged predictably and reliably on a need-to-know basis.

In the next section, we’ll discuss how APIs can be an agent not just of digital transformation, but of digital revitalization—breathing new life into your legacy technologies.

APIs and Legacy Databases

Many observers are beginning to notice the benefits that APIs hold for businesses pursuing digital transformation. In turn, this brings an understanding of how APIs might be applied to extract greater value from their legacy databases as well.

As previously mentioned, banks too frequently struggle to step outside the shadow of their legacy databases, feeling trapped and constrained by their own technology. However, the good news is that APIs are beginning to change this unfortunate state of affairs.

For example, the banking giant HSBC has developed an “open banking API” that can facilitate real-time interactions and applications. The HSBC mobile app can now connect to customers’ bank accounts directly and in real time through the use of an API, rather than waiting to sync up with antiquated legacy databases. HSBC was also the first major bank in the UK to release an “aggregator” mobile app in September 2017, permitting users to view all of their bank accounts (even from HSBC competitors) on a single screen through the use of APIs.

Legacy databases are often so difficult to work with because they are impenetrable at first glance, with no easy way of extracting the information inside. APIs change all that by putting a kinder, gentler, more familiar face on your legacy systems. When you wrap your legacy database in a REST API, manipulating this data is only a question of sending the right HTTP request method: POST, PUT, GET, or DELETE.

Conclusion

Thus far, much of the talk about digital transformation has been all bark and no bite. A 2018 study by the consulting firm McKinsey & Company found that just 14 percent of companies have observed sustained performance improvements from their digital transformation initiatives.

While there are a great variety of explanations for why digital transformations fail, one of the biggest is undeniably the stumbling blocks posed by legacy technology that organizations can’t seem to rid themselves of. The good news, of course, is that legacy databases can be rejuvenated with the judicious application of APIs, giving them new life within your IT ecosystem. API modernization of legacy systems provides benefits such as lower operational costs and a more stable and consistent IT environment.

DreamFactory is an API management service that dramatically simplifies the process of creating and deploying enterprise-grade APIs. No matter what your company does or your level of technical skill, DreamFactory will help you instantly generate the REST APIs that you need to modernize your legacy applications and bring your business to the cutting edge.

Want to find out how APIs can modernize your legacy databases? Get in touch with a member of our team to learn how DreamFactory can help, or to start your 14-day free trial.