Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) are both important and useful enterprise application tools. ERP and CRM are similar in many ways, and when their benefits are applied together, they prove invaluable in the profitability of a business.
These systems overlap in some areas and can be completely integrated into others. However, as their core functions are completely different, it’s best for a business to first look at them as separate, stand-alone systems. When viewed separately, it’s easier to see how ERP and CRM each play a role in improving efficiency and increasing sales. Outlined below are the benefits of each:
Enterprise Resource Planning is an important enterprise application that integrates all the individual department functions into a single software application. ERP systems make it easier to track the workflow across various departments.
They reduce the operational costs involved in manually tracking and duplicating data using traditional individual, separate systems.
i. Complete visibility into all the important processes, across various departments of the business. This means you can track the progress and processes for individual client accounts, project status and more. This is particularly useful for senior management personnel.
ii. Having a single, unified reporting system to analyze statistics, status and more, in real-time, across all functions/departments, thus saving you time from manually pulling out data and cross-referencing for separate reports.
iii. Since a Database system is implemented on the backend to store all the information required by the ERP system, it enables centralized storage and backup of all enterprise data. Forget to have to fill in paperwork and manual filing. Simply update information online and enjoy the ability to perform searches within your own database.
In summary, ERP systems make it easier for order tracking, inventory tracking, revenue tracking, sales forecasting and other related activities. It saves you and your organization a lot of time from having to do things manually.
A CRM system is an extremely useful tool for managing a company's interaction with current and potential customers. Benefits of adopting a CRM system include:
i. Efficiency: A well-implemented CRM system can replace manual processes that take up a lot of time. Manual processes often leave gaps open to human error, making things inefficient and inaccurate.
ii. Collaboration: The use of cloud-based CRM platforms allows for employees in multiple departments to more effectively manage their customer relationships and to see the big picture at any time. Just like the ERP, it offers visibility.
iii. Data: CRM platforms typically offer a variety of homegrown and third-party tools that enable companies to understand their CRM data and learn things about their customers that wouldn't be possible otherwise.
Thanks to the data that can be collated with a CRM, customers are more easily and accurately segmented, and their needs identified. For example, sales staff can call up a customer at the right time to check on product depletion and offer new stock, right at the time when a customer needs it.
They can also follow up with any other additional requirements. Because of this, it then leads to more accurate tracking of the company’s relationship with the customer, which in turn results in greater customer satisfaction, customer retention, faster sales, and increased profits.
So what’s the difference between an ERP and CRM, and does a business need both? One main difference is that ERP helps manage back-office activities and tasks (e.g. distribution process management and supply chain management).
CRM, on the other hand, is geared more towards front-end functions (e.g. streamlining your sales processes, and automating customer service). While CRM and ERP solutions are typically handled separately, integration of the systems to share data further improves operations management, thus improving an organization’s bottom line.
As such, it only makes sense to have both, and with tech leading the way, there are many solutions available that seamlessly integrate ERP and CRM solutions to combine financial, operational, customer relations and business intelligence in one efficient management system.
There are also several packages and price points offered, so regardless of your budget, you will most likely be able to find a solution that suits your organization’s needs.