Shadi Fallah, 7-Eleven

Thank you for tuning in to today’s full episode of the Breaking Changes podcast. I’m your host and Chief Evangelist for Postman, Kin Lane. With Breaking Changes we explore specific topics from the world of APIs, but through the lens of business and engineering leadership. Joining me today we have Shadi Fallah, director of digital technology and delivery platform at 7-Eleven. Shadi shared with me how the retail chain was able to rapidly adapt to customer needs during the pandemic by using their API-first strategy to navigate the complex regulatory landscape that exists across the 50 United States. I like starting with the basics. Who are you and what do you do?

My name is Shadi Fallah, I’m a director of technology at 7-Eleven. I think most of our audience are familiar with what 7-Eleven does, a convenience store across the globe. At 7-Eleven I’m leading the delivery program. So 7-Eleven stepped into the online platform and the delivery program in 2018, and my team and myself, we built this platform from scratch as part of our digital transformation in 2018, and it’s growing, and it’s been a great journey with 7-Eleven to build this platform and modernization.

Wow, thank you so much for being here. But 7-Eleven is not a tech company, so what are you doing on an API podcast conversation?

That’s always an important question, I get these questions a lot, because when I started at 7-Eleven, 7-Eleven wasn’t even a big part of the tech industry, even in retail. But we had a bigger strategy of making 7-Eleven run as a tech company. We had a strategy of, think this is a tech company, and we are going to build everything in-house and digitally transform. And we did it, we moved away from all of the legacy systems, migration to the cloud, and of course built on the modern tech stack. And of course, as part of it, you cannot get away with the API, so you have to step into the API games to make your platform agile and dynamic and be able to compete with the other platforms, integrate with the other platforms. And that’s how we did it. The strategy has changed for 7-Eleven to act like a tech company. A big investment happened in 2018, late 2017 and 2018, and we are continuing to grow in the technology industry.

Yeah, this is the awakening I’m seeing happen across almost every business sector, at least for those who want to remain competitive and want to lead in their industries, they’re waking up to this. So talk to me about what triggered this in 2017, 2018. Was this you and your team going to leadership and convincing them, or is it leadership just waking up all of a sudden? What did that beginning look like?

So in late 2016, early 2017, there was a big change of strategy at 7-Eleven, about how they’re going to grow in this industry as a retail company, and as a need of it, definitely move away from the legacy system and step into the digital transformation, modern tech stack. So there was a big need of growing business, but for growing the business you need to make sure your foundation can support it. We still have some retail across the globe, and of course the US, that they are still not getting to admit the need of these transformations to remain in this competitive market. But 7-Eleven was right on time to get to these changes. We had a three years of digital transformation strategy, and the delivery program was one of the main products of this digital transformation. So my team and myself, we were part of the first group stepping into the digital transformation and building our platform based on the newer tech stack, and trying to guide the other teams across 7-Eleven to kind of come to our world. We built some of our shared services so that we could build new products on top of it, so that we can get to those details later.

Yeah, so one of the most common things I see in the API space is, around 2016, 2017, more mainstream companies are waking up to the fact, everything you just told us, and they begin with these very IT-led initiatives and build technical APIs that follow all the technical ideology that exists in the space. You build them REST and you do these things. But I heard you say, I think you said about six or seven times, products. So what’s the difference between a technical implementation of an API and a product perspective of delivering APIs?

When we started building our strategy, the big part of my thoughts and my team as well, API is just not the service, it’s just not the support for the clients, the applications. We are looking at API as a product, because for having these shared APIs or shared services within the company or even integration with third parties, you build a product that can be used with different clients. Initially, I think in 2014 or maybe around that time, when you were working on any communication between the applications and the server, you always looked at one to one, there was no concept of, you will have an API that can work with multiple applications. There is no one-to-one, it’s always it can be plug-and-play. So that’s what we were trying to build, a plug-and-play model with the configurable APIs. So maybe it would be interesting for you, as part of my organization, on top of all of the client teams that we have, you have multiple applications and so on, we have one of my biggest teams as a product team with its own roadmap, with its own strategy, the API. So this team, all API engineers, the full roadmap for the API, and one of our biggest investments as part of the delivery program, we built many services, many shared APIs that are being used by other applications across 7-Eleven. We were able to build more features for our users, our customers, because of these shared services, and we were able to integrate with our third parties with our API, fast, agile, without actually even needing to have the clients involved or having any changes on the client side. So my main focus during all of this time was that we want to be heavy on the back end and API side and have more lightweight applications, that would give us more flexibility to serve the customer, serve the users with what they need, and respond to their demand by capabilities that APIs provide to us, and give us the ability to build more features in a more speedy and fast environment.

So you’ve been heavily talking about multiple applications and mobile apps. Mobile has been a big driver in waking up mainstream businesses to the need to have these APIs available. And then you lightly touch on, but I’m assuming, this agility and flexibility and velocity goes beyond just web and mobile apps, this is for partnerships as well too.

Yes, so as part of the delivery program we have the application named 7NOW. So 7NOW is the name of our program, it’s a delivery platform, so we work with the partners, we work with the driver fleet and so on. So for plugging in all of these driver networks, all of these partners, all of these marketplaces, we needed to open our APIs to the partner so that they can integrate with us. And I recall, initially our first partner took us two months to build that integration, but after we were done, right now we onboard each partner within a week or two weeks at the most, because we built our plug-and-play model with the API integration. So integrating with partners is a big portion of our work here. And also within 7-Eleven, 7NOW is not only a digital product that we have, we have other products, loyalty, self-checkout, and some of our APIs are being used by the other applications across 7-Eleven for serving our customers. And these shared services, they all talk to our main back end system without actually needing the change there, because you already have this model of shared services that can be used with multiple clients, and there is no need to consider all of the changes that need to come, for example, as a retail organization, that POS needs to support those.

So what does quality look like across this? How do you ensure that these services are reliable, not just for your applications but for your partner applications?

That’s a good question, because when you are looking at a broad organization and you are trying to support your shared services across multiple clients, that could get challenging. But we were able to create this process with the help of the product management, of having this roadmap for only the API, and then the roadmap of the API indicates what are the changes that are going to come. So this center of the APIs drives multiple applications, so if there are going to be any needs that this center team needs to provide for these clients, they all come to this core team, and the core team is distributed to all of the applications, so that we can have control over the quality, the performance of each of the applications, and make sure that by providing the support for one application we are not going to have any impact on the others. So by holding all of them in one place, it gives us full control.

Yeah, you just know where all your APIs are, you have the discovery, you have the control over them, the quality levels, you can secure them. So it gives you this agility and a certain level of velocity with delivering applications, delivering what your partner needs. But what else does this agility bring as far as, I don’t know, digital transformation, but business transformation? Are there competitive, are you able to respond to market needs faster than your competitors, are you able to address regulatory concerns in any way? What are some of the other benefits of being API-first in this way?

Yeah, exactly, the API’s flexibility, that agility gave us, it’s phenomenal. Because as an example, we deliver alcohol, and that was one of the biggest and most important features that came to the market, because we were one of the early providers of alcohol delivery. And you can imagine, for delivering alcohol, all of the regulations across the nations, all of the dry counties based on the location of the users, based on the hours, and all of it, they can get pretty complicated. But we were able to build our alcohol API, that our alcohol API receives the feed of all of these regulations, constantly receives the feed of the location, the type of the location that the user is trying to place an order, the hours, and then the algorithm that we have identifies, based on the location, based on the time, based on the regulation of that location, can be delivered to this user or not. But if we did not have an API to support this model, all of these would have been a manual process for us to identify, can we deliver to this user or not, it would be impossible. So for us to just build this algorithm to deliver and serve and provide the service to our customer based on the need, it’s something we are really proud of, that we were able to build this in 2018. And many of our competitors stepped into this market, but the time we were trying to crack the code on this one, we were the early pioneers in this field, and it saved us a lot of time, saved us a lot of money. Also, responding to the customer demands, responding to the customer is the main thing that APIs provide for us. When COVID hit, we were seeing the demand of the customer, they don’t want to talk to the driver, they don’t want to have any interaction with the driver. And I recall we were like a few days left to get to the full lockdown in Texas, and we saw, okay, we have to do something, we were able to enable a feature for our users to demand, if they don’t want to have any interaction with the users and they want to have a contactless delivery, we were able to roll that out in a few days, because we were driven by API, we were heavily focused on our back end, and a lot of our features are configurable and flexible on the back end, so that we can enable the features that we need to have, even the temporary features, across our applications and across the multiple platforms that we are supporting. So I cannot stress how much and how impactful the role of the API is in our platform. And I understand that 7-Eleven doesn’t look like to be a big user of the API, that we are not tech industry, but actually our platform, our back end is driven fully by APIs after our digital transformation.

Yeah, so do you feel like that regulatory, navigating the regulatory landscape of 50 United States, well, not so united sometimes these days it feels like, but those regulatory needs are difficult, and then you mentioned the county level too, that level of granularity, that’s a lot of work. So good job to your team for learning that and applying it. And then in COVID, in a COVID world on top of it.

I have an amazing team, that I cannot say how talented and how proud I am to be part of it, because this team are looking at how to be more innovative every day, looking to see how they can take advantage of the new technology, how we can stay on top of our game by using the latest technology, latest features that are coming out on the cloud environment. So it’s been an amazing journey, and it’s been amazing to be part of this team.

Yeah, I think that type of innovation is what every company is looking for right now. But you’ve been through this digital transformation, you’re realizing the potential of being API-first. Are you going to have, in 10 years, a bunch of legacy technical debt that has to be dealt with again, or is this going to allow you to evolve in a way that won’t happen again?

Definitely we don’t want that to happen again, so that’s why, as part of our strategy, we are constantly keeping up with our tactics, so that, as I mentioned, we want to make sure we stay on top of the technology transformation and technology movement. Because a lot of features we built in 2018, right now they’re like too old, we have to again make sure that we enhance them, and that’s something we are constantly working on. We have great support in our senior leadership, that, even though we are retail, think about yourself as a tech company, so we want to invest in our transformation, we want to make sure five years from now we are not going to become again old school. And that’s the path we are taking, that’s the path we are making sure, we are constantly reviewing our architecture, we are constantly updating our architectures, and working with the big partners on what our needs are. We were able to influence the roadmaps of some of the big cloud providers, of, okay, these are our needs and we need you to support us. And I think that is important even for the cloud providers to understand, retail companies coming to the business, coming to these industries, they have different needs, they have different requirements. So we see the changes in that area as well, they’re trying to listen, trying to understand our goals and our requirements and provide those services for us, so that we don’t end up staying behind the speed of the technology movement and we can keep up with it.

Yeah, so important. Do you feel like your team now has the space to properly innovate, like they don’t feel as pressured and putting out fires and other things, that they’re actually able to stay in tune with the latest technologies and experiment and feel like they have that freedom?

So, I need to be honest, the fire is always there, especially if you’re running a 24/7 platform, so there’s no way you can get away from the fires. But we try to make sure we keep some velocity and some bandwidth of our roadmap on, we are an Agile platform and we are doing Scrum, so we are making sure each sprint we are picking up some of our work so we can keep up with it. Because if we don’t constantly work on it, it’s going to pile up, and the fire is always going to take priority. So we are trying to keep our roadmap, a technology roadmap, separate, that’s part of the technology growth of our strategy. We set up some goals and targets for each quarter, and that’s how we can keep up with it. If I want to be honest, in a business, if you’re not in a tech company, a lot of times priority is going to be more on the business side, on what you can deliver to the P&L. But we are making sure this is not going to be the only goal for a team. So definitely supporting the business demand as a priority, but hand in hand supporting the technology and making sure we keep moving with the speed of the technology movement, with the growth we are in. Before COVID happened, I’m not saying we were unknown, but definitely after COVID, 7NOW became one of the pretty known platforms in the delivery market. So for us to make sure we have proper support for our users that are growing every day, we need to make sure we have a scalable, stable platform to support this demand, and that is of course on the client side, on the application, on the support tools that we built, and the main will be our back ends and our APIs platform.

Yeah, it sounds like, would you say that the APIs played the role, I mean, tech loves new startups and they seem to want to punish older incumbents, older companies, they’re not as attractive. So against, what is it, like Drizly or other delivery apps, Grubhub, things like that, do you think APIs in this relationship, and by responding so rapidly to your users, is what enabled your ability to keep up and remain competitive against this new breed of startups?

Absolutely, absolutely, because we are able to onboard partners right now within a week, we are able to enable autonomous delivery, that data startup is fully based on the latest technology. So if we were not API-driven, we would have not been able to keep up with this demand. And the integration with our partners, it’s a key element in our business, because we have our marketplace partners and we have our drivers, so for both of these platforms, the only integrations that we have are through our APIs. So if we did not have a strong API platform, if we did not have a strong back end to support this integration and bring the agility, it would take months for us to onboard a partner. I don’t think we would be successful, because the demands and the speed of this environment is way dynamic, so for us to keep up with it, API is playing a big role.

Yeah, so what you just said, it sounds like it’s not just APIs powering 7-Eleven directly to innovate and deliver the next-level services, you’re able to immediately partner with any startups that come along. So it’s not just, oh, these new startups are competition and we need to out-compete with them, you can do that, but you also play nicely with them as well, and are able to actually let them use the 7-Eleven ecosystem.

Yes, we onboard our competitors to our system, so we let them use 7-Eleven instead of our competitors, so they become part of our ecosystem. So imagine if you want to order your favorite food, but you still have cigarettes or something that you want to get from your convenience store across the street, so the partners, all of our partners, they can do it for you. So we have this capability for them to combine their demands and their customer needs with 7-Eleven, because 7-Eleven plays a big role in the convenience market, and that’s important because it’s everywhere. And I think in the latest evaluation I read, we are within a mile of more than 50 percent of the US population, and that was before our acquisition of Speedway. So imagine these stores, that they can support the customers and our partners, that they can use these stores to grab whatever the customer needs from the convenience. If you want a milk for your child and you want to order your pasta, you can have it. So a lot of our partners and our sort of competitors, they are willing to integrate with 7-Eleven because of the variety of the items we provide to our users and their users. And of course on top of it, alcohol is playing a big role here too, alcohol for our users in the pandemic, we had more than 400 times alcohol ordering. So I guess that was the customer demand on it.

Yeah, alcohol is a pretty fundamental aspect of society, but also during the pandemic, I think even more so. So companies like Amazon have always, they disrupted lots of retail, bookstores, by being this virtual powerhouse, and they’re one of the original API-first stories that you hear out there. But they’re eyeballing and doing retail now and delivery on their own, you know, they bought Whole Foods, so clearly retail is a pretty fundamental part of this, you can’t just win by being virtual alone. So do you feel like this combo, that your retail brick-and-mortar presence plus your API-first is the winning combination?

It’s definitely a winning combination, because we brought the agility, so we can respond to our customer demand with the platform we built, and also we have these stores that play like a warehouse, but they’re all around the US. So the 7-Eleven customers, definitely they are different, and if you have orders from a convenience, you’re looking at a different type of needs versus if you’re ordering from a company like Amazon as a retail. Definitely Amazon is one of the leaders, ahead of technology, and they have been in the API business for a while, but the capability that we built and the foundation we built allow us to stay on top of this competition. I don’t see these big players coming to this market with the stuff slowing us down, because the foundation that we have allows us to move fast as them. I don’t see that 7-Eleven would get pushed away by the big players, I think 7-Eleven is a big player in this market for the delivery demand, and with the capability that we have. If it was 10 years ago, if it did not go through this, then maybe we could have not responded and could have not competed with the other retails that actually transformed, that are agile enough with the use of the API. But now that we are in it and we were able to provide that to our customers, and we are trying to stay on top of it, constantly modify it, constantly transform to respond to all of the technology changes and use the new services that are constantly coming to the picture, I think it would give us a lift to move faster than before.

Yeah, another thing, I talk to a lot of people in the API space, so I hear lots of words and phrases, and I pick things out to understand where people are at in their API journey. And one of the ways companies, or we in this API space, have described APIs over the last decade is about resources. So REST API design, REST is RESTful, resource expressions of images, contacts, and that’s been very powerful, that’s had a big effect. But I keep hearing you say capabilities, capabilities. So it sounds like it’s much more than just, oh, I can get a digital resource, it’s actually that next generation of that, I need to do something with that resource or make something happen that’s of value to business. It’s not just about having our back-end databases expressed as digital resources, it’s much more than that.

Yeah, let me give you an example. So with this capability, as I mentioned, we are able to drive business to promote different products for our customers. If you are a user and you’re using our application in the morning, we are going to show you the breakfast item based on your location, based on the area that you’re in, and we have the algorithm to see what have you searched before, what are your preferences within the application. So we are prompting different products, or if there is a new product coming to your area, we encourage you to try it, and then if you’re coming back on the late night, we are offering a late-night snack. We could have not done this, we could have not promoted different items to our user, if we were not driven by APIs. We could have not constantly shuffled our items and categories to our users if we were not using APIs, and that’s something to serve our business. A lot of the time we are trying new items just for specific users, because we want to hear feedback, and that’s driven by our APIs, because that’s the one enabling that, okay, this is a test item, do you want to be a part of it, we can have you try this new big pizza for us, for example. These are kind of capabilities that we are taking advantage of by using APIs, and also knowing our customers and how we can serve them, try new items in different markets. So you have, for example, a storm, a winter storm running in New York, and we are offering them hot coffee. People in California, they don’t care about the hot coffee in the morning, they want iced. So if we want to run offers on the East Coast versus the West Coast, we can have a completely different type of promotion based on their location, based on the weather you are in, based on your season. So these types of things, they’re all coming because of the API. And I think the beauty of it is how I look at it, APIs for us is just not a technical concept that our business partners don’t like to hear. We were able to educate them, all of the cool things you would like to do, it’s because of this. If you want to run the promotions, this is the one that’s actually helping you. So combining this would actually bring the business value, drive sales, make the retail company excited, so that’s how they get more engaged, they invest more on it. That yes, the modern technology, API, investing on it is actually driving value. It’s not like, oh, okay, it’s the IT thing, we have to focus on the sales, but this is actually driving sales for you, it’s actually adding value to the business. And I think that’s beautiful, to get all of these together and look at the one picture.

Yeah, so it’s not just about the direct, oh, we have APIs available, and here’s what’s for sale, and you can have that in mobile apps and partners, it’s also the fact that you’re API-first and you’re so agile that you’re able to respond to these and the feedback loop that exists there. So not only are you able to respond to new market situations, things that the customers are needing, but you’re able to validate, yes, people want that or not, and try new things out. So it’s not just agile doing APIs, it’s because you’re agile doing APIs, you’re agile doing business, and you’re able to gather feedback and move quicker from a large customer base pretty rapidly.

Exactly, exactly. Recently we went to one of my business partners, was asking, hey, we want to run some free item as a gift, but we don’t know what we should offer to our users, can you have this as a prompt to our users, what do they like, and then we can gather the feedback. So then we can run it in that location. If we were not API-driven, if we were not API-first, we could have not done it, so we wouldn’t know customer demand. So we are going to offer the customers six different items to get their pick, and then they can later get the free item. But if we didn’t have this capability, we would need to just go with our own understanding, without actually reading the market demand, without actually knowing our market, without actually getting engaged with our users. So being API-first, building our foundation based on the API, unlocked many capabilities for us, for our business, for our business partners, to help them drive a more successful business as well.

Yeah, wow, I mean, that’s definitely, we use the phrase API economy a lot in the sector, and most of the time it doesn’t mean anything, so I’m the first to admit. But the most sophisticated conversations I’ve had on the show were with like the Twilio folks and Stripe and others, who, the common notion with API economy is, if you launch an API as a product like Twilio did with SMS, that you will play in this new API economy and there will be all this value generated, and that’s true. But it’s what that enabled. Because Twilio SMS by APIs enabled Uber, enabled Grubhub and these other types, and it’s probably enabling some of what you all build. And so it’s that second net, that next generation of entirely new types of business, entirely new ways of doing things that work within heavily regulated or dry counties, as you all are experimenting with. It’s that type of innovation that’s going to define the future of business and what’s happening.

Exactly. I a hundred percent agree with you, because we got to the stage that I think a lot of partners understand the value of the APIs and how we can integrate with each other in a more agile version, and we can help each other to drive more business. For example, maybe 10 years ago you would have a completely separate way of integrating with a partner or onboarding a partner for your service, or, like a Stripe as your payment provider. But, I’m sure, onboarding Stripe wouldn’t be the whole different concept, 10 years ago any payment provider would be. But right now, with the players like Stripe, Twilio, or others helping a lot of big corporations, a lot of big businesses or even small businesses to grow, it became way faster if they are in the API business. So if you are a business that you’re trying to stay old school and you’re not going to invest in moving to the new technology or invest in the APIs, then you would have a hard time integrating with a lot of partners out there, and you would have a hard time using a lot of services, because that’s how it works. But for us, we were able to integrate not only with a partner for sales, for our payment processor, for our customer care support, and all of it, all because we are API-driven and because we are API-first. So as I mentioned, the strategy of having the separate product as API for us, it was odd for many of my colleagues when we were discussing it, look, we are not going to have an API engineer embedded with the application, we are going to have a product that is API, we are going to have a roadmap that is for API. So it was a conversation, I remember I had with senior leadership, I want the API to be separate, I want the API to run its own speed and run its own roadmap, strategy, and budget. Usually API is one of the support services for the application, because product is client, product is end user, and API is not. But by introducing this concept, by following this concept, now after two, three years, the value of it is more than obvious for the company and the senior leadership, and the support we got for it. And I think that was something with the team, and of course the support I have from my leadership, it brought a really big, opened a big door for the company. If I want to put it in a small and simple way, do you feel validated and successful now in your vision?

Yes, I feel like it worked, because I believed in it. I believe that shared services and API as shared services is the future. It doesn’t make sense to look into it one to one and build everything on a client base. I’m not saying, not sophisticated on the client side, but I would rather have a lightweight client, an application, and invest on the back end and API side, because the demand of the market, the demand of the user, it’s way more faster. So if we want to move fast, if we want to stay dynamic, if we want to stay responsive to the customer demand, we have to be able to react fast, and that cannot happen without having APIs first, an API product.

Wow, I’m going to end this podcast on that note, because that was, I couldn’t have said it better myself. Thank you, Shadi, for coming and being with me here today, this has been awesome.

Thank you, thank you for having me, it was a great conversation.

Thanks again to Shadi for stopping by. You can find more about 7-Eleven at 7-eleven.com, and you can find Shadi on LinkedIn. You can subscribe to the Breaking Changes podcast at postman.com/events/breaking-changes. I’m your host Kin Lane, and until next time, cheers.