APIs and ERPs: A Match Made in Heaven | Dreamfactory

History is full of dynamic duos like peanut butter and jelly or Batman and Robin—but is it time to add APIs and ERPs to the mix?

According to a 2019 study by Cloud Elements, APIs and ERPs are essential to modern business strategy. 55 percent of respondents believe that API integrations are “critical” to their operations. What’s more, the survey’s participants say that ERPs are one of their top three business use cases for API integrations.

But what are APIs and ERPs exactly, and what makes APIs and ERPs the perfect match?

What are APIs and ERPs?

An API (application programming interface) is one of the building blocks of modern web and software applications. APIs are interfaces that define protocols, tools, and routines for how different applications interact with each other.

One extremely common API use case is integration with web mapping services such as Google Maps. Many third-party applications allow users to share geographical locations with each other, from messaging apps like Facebook Messenger to business review websites like Yelp.

Rather than implementing their own mapping service, which would be highly costly and time-consuming, these applications simply use an API to pull information from Google Maps. The Google Maps API informs users exactly how to request different types of information from the Google Maps service, such as route directions or Google Street View images.

Perhaps the best analogy for an API is the menu in a restaurant:

• Diners at the restaurant can select a limited number of options from the menu, just like API users can choose from a set of operations.
• Each restaurant has its own menu, just like each application has its own API specifying how users can interact with it. Trying to order from a different restaurant’s menu, or trying to use a different API, will likely not be successful.
• Neither the diners nor the API users need to know what’s going on behind the scenes—how the food is prepared, or how the program handles the user’s request.

ERP (enterprise resource planning) software is the term for applications and systems that help enterprises integrate their business processes across various operations. Today’s modern organizations perform many different functions, both external and internal: sales and marketing, inventory, human resources, finance, customer support, and much more. ERP software fills in the gaps between different functions, helping you connect and streamline your business processes to improve your productivity and efficiency.

E-commerce websites are just one use case that demonstrates how ERP software can be priceless for your business. Operating an e-commerce website at scale requires a tremendous amount of work behind the scenes. You need to run sales and marketing campaigns, keep track of the items in stock, effectively manage customer relationships, coordinate shipping and logistics, and more.

When customers on your website prepare to check out, for example, you need to check that the items in their shopping carts are in stock, auto-fill their shipping addresses and billing information, and begin the fulfillment process. ERP software helps these disparate business functions interact with each other, and exchange the data they need to keep everything running smoothly.

The Challenges of ERP Integrations

Despite their multipurpose nature, ERPs aren’t the only technology that organizations rely on. For example, you may use highly specialized internal applications for particular business functions (e.g. accounting and order fulfillment). You may also require external integrations to assist you with smarter, data-driven decision-making (e.g. weather and traffic information for delivery vehicles).

When implemented correctly, ERP software and systems can be a smashing success for your organization. However, many businesses have traditionally struggled to make effective use of their ERPs, faced with the growing technical complexity of their IT environments—including the need for more and more internal and external integrations. Most ERPs are designed only for general business purposes, which means they're not

Due to these challenges, analysts estimate that the failure rate for ERP projects is shockingly high: up to 75 percent. The most common issues with ERP implementation include time and budget overruns and trying to bite off more than you can chew. So how can organizations use APIs to beat the odds and deliver a winning ERP system for their enterprise?

How Do APIs and ERPs Work Together?

As with any other software or service, APIs can greatly enhance your business use of ERP software. APIs ensure that the ERP is easily accessible to other applications and systems, and vice versa. To do so, the API acts as a middleman between the ERP and any third parties with which it interacts—for example, a user requesting information, or an external data source.

For example, APIs can help export the data in your ERP software to a third-party data visualization service. Cutting-edge dashboards, graphics, and reports can make it easier for analysts and key stakeholders to find hidden insights and chart the course of the business.

In many cases, organizations already have a legacy ERP system in place, but they're unable or unwilling to upgrade it due to the complexity and cost that such a migration would entail. Again, APIs can come to the rescue: APIs are also highly useful for integrating legacy on-premises ERP systems with cloud-based software and infrastructure.

Whether you're using a cutting-edge ERP or one that's decades old, APIs are incredibly valuable to enhance your use of an ERP system. But there's one important issue: building all these APIs takes time—unless, of course, you have a solution that can automatically generate clean, secure, fully documented APIs at a moment's notice.

For many enterprise customers, that API management solution is DreamFactory. Click here to read how one of DreamFactory’s clients, the IT consultancy firm TECHeGO, built a rich ERP platform with APIs that allowed employees to quickly and easily connect their business applications. Thanks to the pre-built API endpoints in the DreamFactory platform, TECHeGO was able to dramatically shorten the ERP development cycle by 10 months.

Benefits of API-ERP Systems Integration

Integrating APIs with ERP systems is a big game-changer for businesses. Here are some key benefits that make API-ERP systems integration so impactful:

Data Accuracy and Consistency

Imagine never having to worry about data entry errors again. With API-ERP integration, data flows automatically between systems, cutting out the manual input and the mistakes that come with it. This means all your systems are always in sync, providing reliable, consistent data across the board. So, when you're making critical business decisions, you can trust the information at your fingertips.

Real-Time Data

APIs connect your ERP system with other applications, allowing you to get real-time updates instantly. Whether it's checking inventory levels, monitoring financials, or tracking sales, you have up-to-the-minute information whenever you need it. This immediate access helps you respond quickly to changes, make timely decisions, and most importantly, stay ahead of the competition.

Operational Efficiency

APIs turn complicated, time-consuming processes into seamless, automated workflows. When a sale is made, for example, APIs can update the inventory, generate invoices, and notify the shipping department—all without manual intervention. This automation not only saves time but also reduces errors and frees up your team to focus on more strategic tasks. The result? A more efficient, productive operation that can handle more with less effort.

Tips for Maintaining and Scaling API-ERP Integrations

Integrating APIs with ERP systems is just the start. To keep these integrations valuable as your business grows, maintaining and scaling them is essential. Here are some tips to help you achieve that.

API Performance Monitoring

• Continuous Monitoring: Use monitoring tools to keep an eye on your API performance. Track metrics like response times, error rates, and usage patterns to identify and address potential issues before they impact your operations.
• Notify: Configure alerts for critical API performance thresholds. This way, your team can be immediately notified of any performance dips or failures, allowing for quick intervention.
• API Logs: Analyze API logs regularly to detect unusual patterns or recurring errors. This can help you identify root causes of issues and improve the overall reliability of your integrations.
• Routine Maintenance: Schedule regular maintenance windows to update and optimize your APIs. This includes applying patches, updating dependencies, and refining configurations to enhance performance.

Scaling Integrations with Your Growth

Design your API-ERP integrations with scalability in mind from the beginning. Utilize scalable architecture patterns like microservices, making it easier to expand features and handle increased loads. Leverage cloud resources to automatically allocate more capacity during peak times, ensuring seamless performance. Implement load balancing to distribute incoming requests across multiple servers, preventing bottlenecks. Regularly optimize API endpoints by refining queries, caching responses, and minimizing payload sizes to handle more traffic efficiently.

API-ERP Systems Troubleshooting

• Identify and Resolve Data Mismatches: Ensure that the data formats and structures between your API and ERP systems are compatible. Use data validation and transformation tools to handle discrepancies and prevent integration failures.
• Manage Rate Limits and Throttling: Be aware of any rate limits imposed by your API providers. Implement strategies to manage and distribute API calls effectively to avoid hitting these limits and causing disruptions.
• Handle Authentication and Authorization Issues: Ensure that your API and ERP systems have robust authentication and authorization mechanisms in place. Regularly review and update access controls to maintain security and compliance.
• Address Latency and Timeout Problems: Monitor for latency and timeout issues that can degrade performance. Optimize network configurations, and consider implementing retries and fallback mechanisms to handle temporary disruptions.

How DreamFactory Simplifies API-ERP Integration

DreamFactory's API generation tools can transform API-ERP systems integration into a painless process.

With a pantheon of connectors that support databases like MySQL, PostgreSQL, SQL Server, and Oracle. This tool rapidly creates secure REST APIs with comprehensive CRUD endpoints, significantly reducing development time.

Key features include granular Role-Based Access Control (RBAC) for enhanced security, real-time monitoring and logging for performance management, and API rate limiting and caching for load management, making DreamFactory an ideal solution for technically robust and scalable ERP integrations.

Conclusion

APIs and ERPs are the perfect match for each other. Today's modern ERP software requires integrations with an ever-increasing number of systems and services. By using a API management solution, you can build an ERP capable of keeping up with this spiraling complexity—one that will continue to serve your business well, now and into the future.

DreamFactory is a powerful, feature-rich REST API management platform that includes pre-built integrations with ERP software such as QAD, Infor, and Deltek Costpoint. Want to learn how the DreamFactory platform can fit your business needs and objectives? Contact the DreamFactory team today for a free trial of the platform.