by Spencer Nguyen • May 18, 2022
API integrations are foundational to the innovation and agility companies need to remain competitive. Using APIs lets companies connect systems to build new capabilities to extend their services and provide enhanced customer experiences. This guide discusses API integrations and shows you how to define an API integration to start building your API ecosystem.
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An Application Programming Interface (API) is a mechanism that allows software components to exchange data with one another. API integrations enable organizations to combine information from disparate data sources to achieve seamless functionality for a specified workflow.
Open APIs: Publicly available interfaces to share data between applications.
Internal APIs: Private application programming interfaces that connect internal systems and datasets within the business.
Partner APIs: Used for business-to-business information sharing between third-party business partners.
There are three common strategies for defining API integrations. Each has pros and cons. The one you choose will depend on your needs and your team’s skill level.
Custom data integration is how developers write software code to connect systems. With this approach, the developer gathers requirements from the stakeholder. The developer then builds a solution to meet those requirements. Custom-coding an API requires knowledge of programming languages and common API protocols. Custom solutions are difficult to support. These types of integrations may not follow standard design and development practices. As a result, the company will spend additional money to keep someone on staff to maintain the integration.
Connector applications are middleware that sits between (“connects”) two APIs. The developer doesn’t need to write an API. They simply use a connector to integrate systems. The connector receives information from the source system and passes it to the destination API for processing. The destination API returns the processed data to the connector, which in turn passes it back to the source system.
A simple example of an integration connector is an application between your customer relationship management (CRM) and email marketing solutions. The email marketing solution might need some extra information from your CRM that is not currently passed. You could build a connector that would pass this information into the email marketing solution without forcing you to change your CRM’s API.
An API integration platform is a service that provides an end-to-end capability to create, manage, monitor, and secure a company’s API ecosystem. API management tools are software as a service (SaaS) solutions that offer the following features:
API Control and Governance: An API integration solution includes features like rate limiting and load balancing that help avoid service disruptions. Rate limiting controls the number of requests made to certain APIs in a specified time frame. Load balancing distributes workload across different gateways during traffic spikes.
API Gateway: API gateways control access and perform authentication to the APIs. They also spur innovation, expedite business processes and workflows, encourage reuse of APIs, and create a fluid customer experience for developers (among other things) by granting quick entry to them as well as customers.
API Developer Portal: A robust portal provides developers with the resources to quickly create cloud applications or web services with APIs. Resources include API documentation, OpenAPI specifications, use cases, and other material that help programmers understand how the API works and what it can do.
API Lifecycle Management: An API integration tool solution provides all the tools and infrastructure for planning, designing, implementing, testing, and publishing your APIs. It also allows version control of APIs so that developers have access to the latest versions of these applications as needed.
API Insights and Reporting: An API management solution is essential for gathering analytics to help leaders act on lucrative business opportunities. It also enables them to spot and resolve problems before they spiral out of control. Leaders can monitor performance in real-time, view dashboards on usage trends, segment data across multiple dimensions for detecting threats, and more.
Developing an API strategy is critical to business leaders as well as customers. API integrations support business transparency by exposing key information to decision-makers. An API strategy is also important to support efficiencies in customer and employee workflows. Now that we’ve explored how to define an API integration let’s talk about the benefits of doing so.
The proliferation of customer touchpoints has made the customer journey more complex than ever. Today’s digital-first customers expect to connect to brands via various mechanisms such as social media, mobile SMS, website, chatbots, email, or phone. What’s more, they anticipate a personalized, consistent, and frictionless experience regardless of how they interact with the company. This approach is commonly referred to as the omnichannel experience. APIs connect customer information from each of the company’s core business channels, such as sales, marketing, CRM, or customer service portals. The goal is to create a 360-degree view of the customer’s interaction with the company. Using this information, companies can create personalized experiences that cater to their customers’ needs.
Back-office technology integration is becoming increasingly important to give leaders better tools for defining and executing their business strategy. In today’s fast-paced digital economy, business leaders need access to up-to-date and reliable information to remain competitive.
Traditionally, the information leaders need for decision-making is stored in data silos throughout the company. Getting valuable data out of these systems is challenging because the information often duplicates across systems, making it prone to errors and inconsistencies. Not only that, mining these disparate systems for data is time-consuming. Too often, the information isn’t relevant or too outdated to provide value by the time it makes it to leaders. API integrations solve this problem.
These integrations can gather data from disparate systems in real-time. That way, leaders have the most up-to-date information for creating their reports and dashboards.
APIs and workflow automation go hand-in-hand. Employees often need to access multiple systems as a part of their workflow. Navigating each of these systems is time-consuming. APIs let companies connect data from multiple systems into a simple user interface to empower employees to be more efficient with their time. For example, an API could convert an applicant from an applicant tracking system (ATS) to an employee in the human resources information system (HRIS) for employee onboarding. This process eliminates the employee manually transferring data to set up the employee.
Many organizations find it difficult to part ways with legacy systems, given that many of these systems support critical business functions. Unfortunately, these legacy systems hinder business progress. Legacy systems are often slow, difficult to navigate, and don’t integrate with other systems. They ultimately prevent companies from being agile enough to keep up in today’s fast-paced, competitive landscape.
API integrations empower companies to modernize these systems to get maximum value for their organization. Using APIs, companies can unlock data from legacy systems, compose the data into processes, and streamline the user experience across systems. For example, healthcare facilities can use an API to connect several backend systems to create a web services application to allow patients to view and schedule appointments, see their lab results, and send messages to their medical support team.
API integrations are an important strategy for any company looking to automate workflows, modernize legacy systems through digital transformation, and offer new customer capabilities. Use cases for these integrations are endless.
Moreover, the DreamFactory iPaaS offers a point-and-click, no-code interface that simplifies developing and exposing APIs. Try DreamFactory for free and start building API integrations today.
What is API Integration and How Can it Help Your Business?
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