APIs are one of the most misunderstood aspects of B2B-integrations. Almost everyone working in IT has an opinion about APIs, but very few people can see the real benefits and limitations of APIs from an enterprise IT Service Management perspective.

Over the past 15+ years I’ve helped hundreds of business leaders develop better understanding of the benefits and limitations of APIs. During this time I’ve seen an increased need for API integration services as managed IT ecosystems have become more complex.

Let’s go through in the language of business what APIs are, what their limitations are and how you can effectively use them in your ITSM integration strategy.

‍What is an API exactly?

An API, or Application Programming Interface, is a set of rules and tools that allows different software applications to communicate with each other. APIs are used widely across most business operations and are a common way for developers to access third-party applications or IT systems.

APIs are not a new invention. You can argue that APIs have been around since the dawn of networked computers. Many people consider the Salesforce API, developed in 2000, as the first modern-day API because it offered a standardized and open interface available over the Internet. Today there are many different types of APIs (eg. SOAP, REST, FTP etc.) offering different sets of rules for integration, and each API will have its  unique protocols or rules to follow.

What ITSM leaders need to know about APIs

APIs appear straightforward on paper, but real-world implementation is often more complex. Since each system you’re planning to integrate has its unique behavior, an API also has unique specifications for how it accepts and processes data. You need to consider authentication protocols, payload structures, error handling, and expected response formats. This complexity multiplies when you work with many APIs across your business unit or organization and when you’re integrating data models, processes or workflows that don’t follow any standards.

An API is not an integration

One important thing to clarify is that an API is not an integration. You can think of it more like a standard socket that enables integrations. It gives you a means of integrating, but in itself, it does nothing actively. 

APIs simply give you a way to integrate different systems, but each integration needs to be built in and maintained separately. Just like there are many different types of electrical sockets around the world, there are many different types of APIs. You’re unlikely to be able to manage an integrated IT service landscape just with one type of API.

Lack of standardization

Not all APIs are created equal. Different systems use different API designs, which can quickly lead to inconsistencies. For instance, a RESTful API may handle authentication differently from an older SOAP-based API. Some APIs offer bi-directional interactions, others don’t. You need to have a clear understanding to map these diverse structures into a unified ITSM framework.

Let’s take a typical example of the lack of standardization in the Service Management space. You may have ServiceNow as your core ITSM platform and Jira and BMC Remedy offering some support functionality. With four different ITSM platforms, the integration needs quickly become complex, because each system and integration point may require their own data model and systems “behave” differently.

Examples of API Integration Service Use Cases

API integration services are essential for modern businesses to automate workflows, improve data accuracy, and enhance customer experiences. Here’s a look at how API integration services support different use cases:

1. Two-Way Data Synchronization: Many businesses rely on two-way synchronization between systems, such as CRM and ERP, to maintain consistent and accurate information across departments. With two-way data sync APIs, updates made in one system, like a CRM, are immediately reflected in the ERP, ensuring that both sales and operations teams work from a single source of truth.
2. E-commerce API Integration: For e-commerce platforms, API integration services enable smooth coordination between online stores and back-end systems, such as inventory management or fulfillment platforms. An e-commerce API integration keeps inventory levels updated in real-time, automates order processing, and ensures consistent product information across multiple sales channels, such as the website, mobile app, and marketplaces.
3. Payment and Merchant Center API Integration: Payment gateway integrations simplify transactions by connecting businesses to a variety of payment providers. For example, an integration with a merchant center API enables businesses to manage orders, returns, and payments across different platforms, improving cash flow visibility and ensuring a streamlined customer experience.
4. Real-Time Carrier / 3PL API Integration: Logistics and shipping operations benefit greatly from real-time carrier and third-party logistics (3PL) API integrations. This type of integration allows companies to offer accurate tracking, delivery estimates, and shipping rate comparisons by connecting directly with carriers. Retailers and e-commerce businesses can automate shipment scheduling, reducing manual entry and enhancing delivery reliability.
5. Retail / POS Automation API Integration: Retailers integrate their point-of-sale (POS) systems with other platforms, such as CRM or inventory management systems, to automate inventory updates, customer data collection, and sales reporting. POS API integrations allow for real-time insights into stock levels and customer purchasing behavior, enabling better decision-making and enhancing customer experiences both in-store and online.

APIs need to be maintained

Once an API integration is set up, that's not the end of the story. Every connection requires continuous maintenance to account for new features, security updates, and system changes. When an API is deprecated or updated, failing to adjust the integration can lead to data loss or service disruptions. 

It’s also rare that your integration landscape remains the same. Typically enterprise organizations will have changing integration needs, and this creates the need for systematic API integration management. So what are your options?

Five common API integration services

There are many approaches to using APIs for integrating different systems across your IT service management landscape. Let’s go through five of the most common methods.

1. Point-to-point integration
2. Enterprise Service Bus (ESB)
3. ITSM portals
4. Integration Platform as a Service (iPaaS)
5. Integration as a Service
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1. Point-to-point integration

Point-to-point integration, also known as "p2p integration" or "direct integration," refers to a direct method of connecting two applications or systems using code without the use of a centralized integration platform. A good example of this is directly integrating ServiceNow to Jira using the APIs provided by the ITSM platforms themselves.
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2. Enterprise Service Bus

Enterprise Service Bus (ESB) is a set of principles and guidelines for integrating various applications over a bus-like infrastructure. An ESB acts as a central hub to which all applications of an organization connect, providing a common language for them to communicate. While a good idea on paper, in practice, the ESB model is often expensive and complicated to maintain.
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3. ITSM portals

ITSM portals. Most major ITSM platforms offer an integration portal as part of their service, (for example the ServiceNow Integration Hub.) Portals can be a good option for you if you have a relatively simple ITSM landscape, or if most of your managed services fall within one platform. The downside of ITSM portals is that they can take significant time and resources to set up and maintain.
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4. Integration Platform as a Service

Integration Platform as a Service (iPaaS), offers pre-built connectors and data transformation tools to streamline API integrations. These platforms handle the heavy lifting by providing automated data mapping, format conversions, and real-time monitoring, reducing the need for custom coding. The major downside of iPaaS solutions is the cost to set up and operate, especially if the platform is offered on a consumption basis.

5. Integration as a Service

‍Integration as a Service. A final option for API management is to outsource API management. Integration as a Service solutions, like the one we offer at ONEiO, takes away your API integration pain. This model is especially relevant for organizations with many different IT systems, or ITSM ecosystems with 3rd party service providers.

A large enterprise organization can use more than one API integration service at the same time to integrate different parts of their business. For example, direct integrations to ERP may be more common in core production or supply chain functions, while integrations as a service are often used in Services Management. Often the decision of API integration service comes down to a cost / value calculation.

How to calculate the API total cost of ownership

When you’re evaluating your options for API integrations, it’s important to consider both the direct and indirect costs to build and maintain the service.

Direct vs. indirect costs

The cost of API integrations goes beyond development hours and software licenses. Direct expenses include the time and resources needed to build and maintain each connection, licensing fees for third-party platforms, and the infrastructure required for hosting and security. 

Indirect costs, however, often add up to even more. Downtime due to failed integrations, compliance issues from inaccurate data flows, and increased security risks can severely impact business operations and customer trust.

Cost of maintenance

Maintaining API integrations requires constant vigilance. As platforms evolve and their APIs are updated or deprecated, integrations must be adapted accordingly. This upkeep can involve revisiting authentication protocols, updating endpoint mappings, and verifying data consistency. 

Without a streamlined approach, these maintenance tasks can lead to escalating costs, especially if legacy integrations require custom fixes or specialized knowledge to address new challenges.

When to outsource an API integration service

As an IT Service Management leader, you also need to think about what are the core competences of your organization. 
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Here are a few questions to ask yourself: 

• Do you have the in-house competencies for building and managing ITSM-related integrations?
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• Does your integration use case require always-on, real-time dialogue between systems (not just an API)?
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• Does your integration strategy include external parties like  service providers, customers or subscontractors
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More often than not, building and managing integrations and APIs  is not a key focus area in Service Management. In this scenario, it’s more likely that you’ll be looking for a service provider to manage your integrations on your behalf. 

The bottom line on API integration services

APIs are a standard way for computer systems to communicate with each other, but all APIs require some type of integration service to run. 

Whether you choose to build point-to-point API connections or rely on an integration platform or service, you need to consider the total cost of building and maintaining your integrations. In many cases, the best option for an ITSM organization is to outsource the integration hassle to a specialist.

At ONEiO we are the global leaders in service integrations. We leave no stone unturned in providing you integrations as a service across your entire Service Management ecosystem. If you’re looking to move beyond API management towards concrete business outcomes, book a demonstration today.

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