This article is a follow-up to the earlier one published on Monday, 10 May, 2023 edition of this column. In the earlier edition, I treated you to how system integration and software compatibilities facilitate business performance in the modern corporate world. Today’s article further looks at software integration and its relationship with Application Programming Interface (API).
To re-emphasise the basic understanding of software integration, I will once again describe it as the process of combining two pieces of software in order to solve the problem of isolated data. Technically, it is the process of connecting one software application with another, typically through their application programming interface (API). To function properly, APIs must be integrated correctly with other systems. Indeed, breaking down the basics of Application Programming Interface (API) can help understand its power.
API in Motion
Application refers to any software with a distinct function. We have software (applications) developed for businesses to use to exchange information such as financial data, stock levels and purchase order with trading partners, suppliers and customers. There is also a unique software (application) like reksoft which performs account reconciliations involving millions or volumes of transactions.
Software (Application) is created by professionals or developers who use programming language. In other words, developers write the codes to create and design new software (applications) and the interface.
Interface refers to how any distinct software interacts with other applications. It is a set of defined rules that enable different applications to communicate with each other. By extension, it is that seamless communication link between applications or software. Thus, APIs allow different pieces of software to talk to each other and work together. Many APIs are specifically set up so that they work well with other systems. Indeed, APIs have been purposefully developed for finance, payments, e-commerce and social messaging. In general, multiples of APIs have been developed and same continued for all that we do with applications or need software (applications) to eliminate cumbersome manual or human errors thereby improving quality and efficiency of activities. The impacts have been phenomenal from enabling many businesses across sectors to further experience improvements in speed, consistency, agility and accuracy in their operations. Companies continue to recognise the potential of extending and integrating application data flows via APIs, thereby allowing for smoother business process integration across applications in conjunction with other types of business to business (B2B) technology. This makes them a powerful tool for businesses and enable them to improve their performance.
–API By Audience
Application Programming Interface (API) developers have classified them into types and this helps your companies to understand them and then determine which one provides your business solutions. There are two distinct types-A public API and an internal API based on who has access. But any API will have an audience (scope), an architecture, and a protocol (the format used to communicate data between applications)
Secondly, private or internal APIs are designed solely for internal use within private companies or institutions. To interact with the data in a private API, a developer typically needs to be actively granted permission to access it, because the data and functionality available through the API are proprietary (exclusive) to the company. Private APIs are often set up with extensive logging and load-balancing capabilities because they must have greater fault tolerance and security than public APIs. They also do not follow the Open API standard as consistently as public APIs.
Partner APIs is another form of API which exists in-between the public and private APIs. Partner APIs functionality involves sharing data between two companies for a specific business purpose, while ensuring strict privacy protection regarding authorisation and authentication. We can consider the case of an individual who uses personal finance tools to enable him to share access to his current accounts with his institutional pension planner. He would not be able to connect his personal websites to the bank’s API because his is not an approved institutional partner, but can he can authorise the two companies to share information about his accounts via their partner APIs.
API by Architecture
Most public APIs are described as monolithic which means that they are designed as a single, coherent code-base and providing access to a complex data source. They provide predictable functionality across a range of resources, and they generally remain fairly stable over time since they are technically structured to serve so many different users.
API by Protocols
The protocol defines how your API connects to the internet and how it communicates information to users. The protocol you choose will determine how to design and build your API and how to maintain it. Protocols have their strengths and weaknesses and must influence choices regarding software integration decisions in any company or institution. The commonly known protocols are the REST (Representational State Transfer) APIs, remote procedural call (RPC) and the simple object access protocol (SOAP). Without necessarily delving much deeper into these protocols, I will, however, say that REST APIs in relations to others use low bandwidth and are highly scalable.
Indeed, it is worth reiterating that API solutions enable different software systems to communicate with each other, regardless of their programming language, hence, enhancing a unified interoperability between systems to exchange data and functionality. There again, APIs can enable third-party developers to create new applications and integrate them with your existing software systems to give you a better user experience. In short, APIs are integral to running a data-driven business in the digital space from social collaboration tools to more innovative approaches to enhance customer experience. Thus, taking advantage of APIs can improve your company’s bottom-line. But in the face of all these benefits, companies must not lose sight of the following challenges associated with them.
Challenges with APIs Automation
Security Risks: API infrastructures can be exposed to security breaches, such as SQL (Structured Query Language) injection attacks and cross-site scripting (XSS) to bypass access controls. These make it crucial to implement security measures to protect against these threats.
Dependency on Third-Party Developers: APIs rely on third-party developers to create applications that integrate with a software system. This can create dependencies or raise technical issues that are outside of the control of the company that owns the software system.
Complexity Issues: Despite the benefits, APIs can be complex and require a significant amount of development efforts to implement and maintain the infrastructure.
Compatibility Issues: APIs can also encounter compatibility issues with regard to different versions of the same software system or between different systems, which can lead to errors and system failures.
Governance and Management: APIs require proper governance and management structure in place to ensure they are being used effectively across different applications and systems. Lack of it thereof creates serious leadership problems for companies.
To conclude, despite these challenges, the benefits of APIs cannot be underestimated and continue to be a dynamic and innovative resource of value to your company or any other organisation when implemented or integrated effectively. By and large, when you adopt a strategic approach and address potential issues as they come up, you can have the feel the full influence of the modern API power in your business.
Bernard is a Chartered Accountant with over 14 years of professional and industry experience in Financial Services Sector and Management Consultancy. He is the Managing Partner of J.S Morlu (Ghana) an international consulting firm providing Accounting, Tax, Auditing, IT Solutions and Business Advisory Services to both private businesses and government.
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