Business basics of APIs

Back in the 1990s, many of us learned the basics about unknown subjects thanks to yellow and black books written specifically “for Dummies.”

If you wanted to learn about breeding dogs or Elvis or PCs, you could find a for Dummies book and get the basics.

Nowadays, we’re more likely to Google than to search out a for Dummies book. (Maybe that’s how you ended up on this post.) Regardless, there are some topics of which business leaders need to have a basic knowledge.

One of those is APIs.

So in this post, we’re going to go through the basics of APIs at a non-technical level, so that any business leader can have a working knowledge of this important tool.

What APIs are

An API (Application programming interface) defines communication between pieces of software. Many APIs are read/write, which means they can both send and receive information, but some are also built for one-way communication. APIs are now the preferred way for software to integrate.

We often describe the process of building software like building a house. In this analogy, API are the doors that let you get from one piece of software to another.

What APIs do

The biggest advantage of using APIs is that it allows for instantaneous communication between software systems.

One of the major reasons this is important is real-time data. Instead of having to load spreadsheets with data to keep systems current, the API handles the integrations. This smashes data silos and makes reports more accurate.

APIs also allow software developers to connect systems instead of building the same functionality in multiple systems. This avoids duplicated effort, saving development time and money without sacrificing any of the power of any system.

With APIs, you can also build using different technologies. This gives your business additional flexibility when it comes to adding new platforms like a mobile app, or in adding functionality when you are still using legacy software applications. This is reality for many businesses, especially those who have been using the same ERP since the 1990s or even earlier.

Why your business needs APIs

APIs provide major benefits for your business. They include:

Data Integrity

With APIs in place, you can have one data source for all of your analysis and reporting, instead of separate data silos. This will allow your business more accurate and timely reporting, which is vital for any business that needs to make solid decisions going forward.

Extend the Life of Software

Many companies have old software but can’t afford to replace it because of how integral it is in day-to-day operations, or because of how long it will take a train employees all over again. In these situations, building a web portal or adding a SaaS option with an API integration can provide a functionality boost while extending of the life of this old software. The result is more employee efficiency at a lower cost.

Future Growth

Every piece of software you build should have read/write API capability, because of the likelihood that one day you will need to connect that software to other software or to a service bus. This is true both of custom software you have built, as well as of SaaS products that you purchase to fill out your technology stack. APIs provide flexibility for future growth, whether for something else you’re planning or an unforeseen opportunity that’s beyond today's horizon.

Common frustrations about APIs

APIs can be powerful tools. But that doesn’t mean they’re always useful. Here are some of the frustrations that businesses like yours run into with APIs.

Cost and Ownership

When Worthwhile builds custom software, we include API as a standard part of the project, and we make sure our clients own full rights to the API. But not every software provider takes this approach.

Some pieces of software charge a fee or force you to purchase a higher tier of service in order to access the API. Others charge beyond a certain number of API calls. And some keep ownership of the API, and hold companies hostage if they ever want to change providers.

These costs are a source of frustration—especially when you consider the fact that not every business has to pay them. This highlights the importance of business leaders askingabout API fees and ownership before signing on the dotted line for any software project.

Difficulty in Changes and Setup

APIs are reliable ways to transmit data, but they work best when they are stable. This is great when you have a stable tech stack that you’re adding onto. But if your tech stack isn’t stable, or if you’re doing something completely new, then getting an API just right can take a lot of back and forth.

This is why it’s important to establish your API before you start building custom software or adding enterprise-level software as a service. If you work on both the build or implementation at the same time you’re working with the API, you’re likely going to face delays and difficulties. As a business leader, you need to ask about the stability of your API before agreeing to any deadline or cost for a software project.


APIs are powerful tools, and your business wants to have them at its disposal. To do that, every decision-maker—technical or not—needs a working knowledge about them.

With that knowledge, you’re armed to help your business make better decisions and get more value out of your software stack.

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