CRM Vs ERP – Which One is Right for Your Business?

If your company goals center around streamlining factory production and financials, an ERP system may be the best choice. However, if you want to build customer relationships and grow sales, CRM is the way to go.

Integrating your ERP and CRM systems automates information transfer, which streamlines businesses processes and increases productivity, efficiency, conversions and profitability.

Customer Relationship Management

ERP (enterprise resource planning) is software that automates and unifies back-office functions such as accounting, operations, and human resources. It is a complex solution that requires considerable knowledge and training to implement, but once implemented, it allows companies to better manage their financial processes.

It centralizes internal real-time data and helps companies manage the flow of information across departments. This enables employees to do their jobs without the need to manually request financial or sales information from other departments. It also provides a single source of truth for businesses.

An effective implementation of ERP is a key factor in organizational buy-in and acceptance. To ensure success, businesses should work with an experienced partner and evaluate multiple solutions to find the right fit. The best solution for each organization is different, so it’s important to understand the features and benefits of the solutions and select those that align with the business’s goals.

It is also beneficial for organizations to take a phased approach to ERP. This allows the company to learn how to use the core functionality before expanding beyond that, reducing risk and allowing for quicker return on investment. This is a common way for small and medium-sized businesses to successfully deploy an ERP. It is also a good idea to involve leadership in the evaluation and selection process to help boost the level of buy-in and support of the solution.

Inventory Management

ERP is built to grow with the company, offering a wide variety of tools that all businesses will need to function properly. This includes a full inventory management system that helps companies keep track of their inventory as well as other materials. This enables the ERP to alert different departments of potential issues like bottlenecks that may cause orders to go out late, helping everyone work together to resolve the problem. The ERP also offers a higher level of business intelligence (BI) that lets it analyze past behaviors and make predictions about future outcomes.

CRM systems focus mainly on marketing, sales, and customer service. They gather a large amount of data including client profiles and buyer persona breakdowns, sales pipelines, lead conversions, and more. CRMs even have their own analytics capabilities that let them know how ads are performing, which leads are converting, and more.

Both types of systems can be used in conjunction with each other to streamline the business and increase productivity, efficiency, and profits. Choosing which one to get depends on the primary goals of the company. If boosting sales is the goal, a CRM is more effective; if streamlining production and financials is the focus, an ERP is the best choice. Fortunately, both systems offer integrations that allow for automated information transfer, eliminating the need to manually update accounts in multiple software programs.

Financials

If you’re looking to streamline operations, improve efficiency and boost competitiveness, an ERP system may be your answer. ERP is a comprehensive business solution that provides instant insight into all areas of the organization, including finance, HR, supply chain services, procurements and more. Today’s modern ERP systems have little resemblance to the onsite, on-premise solutions of decades ago and offer the power of cloud technology – including advanced features like digital assistants, artificial intelligence (AI), machine learning, Internet of Things (IoT) and blockchain capabilities – to enable intelligent automation, greater efficiency and new opportunities for your business.

Unlike standalone software solutions, ERP systems allow teams to work together proactively through a single interface, improving tasks like financial planning, inventory management, sales and customer service. By centralizing data for easy access, ERP also helps companies eliminate inefficient processes and costly errors that can occur when departments are using different software solutions.

Today’s leading ERP systems are available in both on-premise and cloud deployment models, allowing organizations to choose the one that works best for them. The on-premise model is implemented onsite, hosted by the hardware and servers of the company and typically requires a large capital investment to purchase and deploy the system – followed by expensive upgrades every 5 to 10 years. The cloud-based ERP solution, known as Software as a Service (SaaS), eliminates these upfront costs and offers lower operating expenses with a monthly or annual subscription that includes ongoing support, updates, training and flexible customizations.

Sales

An ERP system streamlines financial operations to increase revenue and productivity. A CRM software solution provides tools for sales, customer service and retention, boosting the bottom line. Both have a variety of uses and benefits, but the decision to implement either system is based on your company’s primary goals. A business with complex financials and a large customer base requiring frequent contact may choose an ERP, while a small company with straightforward finances and limited customer interaction might opt for a CRM.

An ERP solution typically includes an extensive customer management component with a variety of features such as tagging contacts for future marketing campaigns, sending emails en masse and creating marketing materials. Some systems also include demand planning and supply chain management processes to help companies manage inventory and adjust output accordingly.

A CRM system streamlines customer-focused aspects of your business to boost loyalty and conversions. Its customer-centric tools include tracking each interaction a customer has with your company, automating tasks, storing a record of every interaction and providing a single source of truth for customer information. A CRM software solution also provides a wide range of support services, including email and phone support, live chat and social media. Many systems also include an integrated ecommerce feature that allows users to connect their online store with their CRM.