What is an API (Application Program Interface)?

APIs are mostly invisible to the business user but open up a wide range of possibilities for software programs. They work by opening up a small part of the software’s functionality and data in a controlled way. This allows developers to access that program, piece of hardware, data, or app without needing access to the code for the entire system.

APIs use a range of routines, tools, and protocols to specify how different software components should act together. There are two types of APIs: private and public. The public ones work with consumer-facing applications and give businesses opportunities to connect with their customers using a variety of apps, mobile devices, and browsers. Private APIs work in the back end, streamlining operations and creating tools so customers, staff, and other stakeholders can be served better.

When is an API used in business?

APIs can be used at any point in a software development scenario, such as when two different systems need to access each other or when an external piece of software needs to be joined to an existing system. APIs are a vital tool for all organizations that use any mix of modern software.

For example, a company website will use an API to link between an embedded Google Map on the About Us page and Google Maps itself. A company embeds Google Maps on its website to help readers find the nearest branch locations. This is accomplished by the company consuming Google's public APIs.

The API on the company site is essentially calling the API on Google Maps to provide them with the information and functionality. And of course, this is good for both sides of the interaction. The company website enhanced their functionality while Google Maps can monetize this type of data sharing through a fee or brand the map to enhance their marketing efforts.

Any transactional or service-based business uses APIs to derive marketing benefits from multiple interfaces. There are also a range of commonly used apps that you can connect to via APIs, like Uber, Yelp, Google Maps, and Dropbox ; the list of apps and programs accessible via API are endless. Another common example is APIs allowing customers to sign into a website via their Facebook or Google log in. Additionally, every time you ‘share’ an article online, you’ll click an icon that allows you to share a link via that medium, like Twitter, Gmail, or Facebook. All these services are enabled by APIs.

In a larger sense, APIs have enabled some businesses to grow and expand. Instead of a business developing their own software for payment, communication, data integration, or any number of other actions, an API means external third-party software works perfectly within their internal systems.

In a macro example, the White House has released thousands of APIs that give the public access to information about the government, from finances, to healthcare, to agriculture. The public can find polling stations, information about food safety, or other beneficial information— freeing up valuable time.

Why use an API?

APIs allow an organization to extend their own software and data usage to applications and data that they do not own. This allows a range of benefits such as increased functionality, cost-savings, tech innovation, and streamlined operations:

• Increased functionality for customers: Businesses can offer customers an enhanced customer experience because they have access to whole new data sets and functions. For instance, when you embed a Google Map into your website, you saved the user from having to click on yet another website or application, saving them time, increasing the likelihood that they will be a repeat customer.
• Save Money: Rather than hiring expensive developers to create custom software, companies can have seamless integrations across apps and programs together using APIs. Companies can leverage existing software, rather than developing their own, saving money on R&D.
• Save Time: There are no delays in software development, as the API is generally already written and just needs integration with each end.
• Communicate Better:As new software is added to a business, APIs integrate everything together so the flow of information is seamless.
• Link Seamlessly: Almost any smart appliance or application is now linked to the internet. From fridges to printers, modern technology is now a web of items. APIs allow these smart devices to connect for ease of printing or even ordering a coffee from your desk.
• Extend Marketing Reach:. APIs from Facebook, Twitter, Instagram, Pinterest and other social media platforms allow for the easy sharing of blogs, information, or offers at the click of a button.
• Encourage Innovation: With the security and functionality that APIs provide, developers are only limited by their imagination.
• Streamline Operations: For instance, if a business is developing a travel app, an API allows a customer to go from the plane, to a rideshare, to the hotel, without having to leave the interface or login elsewhere. With APIs, businesses can link booking, payment, and fulfillment components together.
• Innovate Faster: Faster innovation with less barriers to change. Ready-made APIs mean less developer time and faster results. Developers can adapt to a new software or program quickly and easily.

Many APIs are free with companies or developers giving the software away at no cost. This is generally because using their program extends the reach of the software and their push into a market, creating more users for them.

Challenges of developing and integrating APIs

Aging or fragmented computer systems

Organizations change and grow. As they do so, they can become large and fragmented, developing a mixture of new products and services. Systems grow in an organic, often uncontrolled way, resulting in a complex mix of computer systems, technologies, apps, and processes added on an ad-hoc basis. These systems become inefficient over time, with some software and hardware systems becoming obsolete as they age. This often means an organization is not able to easily incorporate its old technology with new software. Their systems become either unusable or isolated. This creates brittle, complicated systems that are prone to failure.

Modern APIs are generally the answer to this problem. Most of the time, even if the API does not have an automatic connector built for an application, developers can build one so they can connect with their legacy systems. Another issue with legacy systems is that as software ages and is no longer supported, which presents a security risk. Again, you can compensate and protect those systems with API functionality, like token based authentication and authorization.

Lack of API strategy and planning

Another challenge is that oftentimes, users dive into using APIs without a plan. Like any strategic initiative, APIs will only be as successful as the plan behind them. You need to plan for the entire lifecycle from creation, to development, to testing, to deployment, monitoring, and retirement of APIs. Of course, if you are just using one or two APIs, this isn’t a problem. But often, most companies will use dozens, hundreds, if not thousands of APIs in their internal and external systems. Multiply that by all the various stages that you have to manage for one single API, and you can quickly see the logistical nightmare it creates.

Users should start with a comprehensive plan for each API, much like you would draw up a plan for a business, to get the most out of the program. Users should also look for a single platform that can support the full life-cycle of an API, which can be crucial to the success of any API program. The best packaged and marketed APIs (which really can only be accomplished with a full lifecycle API platform) are the ones that are most successful.

The future of APIs

These small software intermediaries enable huge transformational potential for any company, large or small. The ability of programmers to connect different applications and systems to form a cohesive, stable software solution is almost limitless. Using components to create software, rather than building from scratch, means expensive and time-consuming specialized software developments may be a thing of the past.

The future of APIs is in artificial intelligence (AI) and machine learning. AI is developing autonomous software that exposes its interface and registers itself with an API database, where it finds a relevant API and installs it, without any human interference.

APIs encourage innovation and freedom

API standard behaviors are still being established. But overall, APIs are an excellent software intermediary that fosters innovation for businesses. APIs will carry a bigger role moving forward, and app developers create programs designed to work together with a range of other software. Automated APIs may not be far away, making systems work that much faster and easier together.