ERP vs CRM

We live in a time where every customer is important for business. Competition is becoming even tougher, which affects management and business practices. A company that does not take into account modern solutions is doomed to failure. In the age of digital technologies, a company has several effective tools to achieve its goals - CRM and ERP systems. Both systems are designed to optimize daily business processes, but functionally, the solutions have significant differences.

CRM and ERP definitions

In order to better understand the difference between ERP and CRM, it is worth clearly explaining the concept of each tool.

A CRM system is a set of software that manages all of a company's processes related to customers and customer interaction. It originates from software designed for sales force management and automation (SFA). After some time, all these areas were combined into a single software.

Tasks that the program is supposed to perform:

1. Collect data about customers. A company should clearly know its market, its interests, and habits. CRM does exactly that: it collects, analyzes, and organizes information about customers and their activity on the website and social pages of the brand.
2. Request management. The program automatically monitors audience requests and notifies managers about them.
3. Organize a marketing funnel. Based on the stored data, the company can fine-tune marketing according to the interests of the public.

Data analytics is an important task of the system. This includes the analysis of the company's productivity, potential sales problems, marketing effectiveness, and other points. This data is necessary to increase sales.

An ERP system is a comprehensive program for monitoring and planning a company's activities. It has become a logical extension of MRP (resource planning). The main tasks assigned to this program are:

1. Financial management. The system monitors the company's active budget, main cash flows, etc. In real time, the program will generate a financial report, invoice, and other financial documents.
2. Organization of production stage management. The ERP system is capable of controlling production stocks, supplying materials, scheduling tasks, and performing a lot of other work without direct human intervention.
3. Providing warehouse accounting and reporting.
4. Sales management. ERP solutions can track customer requests and move them to the next stage of fulfillment.

Modern systems have integrated HRMS systems for managing the workforce. 

Чим відрізняються CRM та ERP

It is not quite correct to compare the systems, because each program is individual in its purpose. They are based on a fundamental difference. CRM is about interacting with the company's customer base, while ERP is a solution for automating business processes, financial control, and performing a host of other tasks.

You can easily see the difference in the composition of each product. For example, some ERP systems may include elements typical of CRM products. However, the latter rarely have ERP components.

Difference between CRM and ERP - comparison table

Which is better: CRM or ERP

A CRM system is necessary when a company is focused exclusively on sales. In other words, the sales department plays a key role in the business, and it will help you know everything about the client.

The difference between ERP and CRM is that the former is more extensive in its application. It is used when a company needs comprehensive monitoring. If the key elements in a business are workshops, production departments, logistics centers, and similar facilities, an ERP system is what you need.

Combining CRM and ERP in one enterprise

ERP/CRM systems have many common features. If these solutions are considered not separately, but in a complex, you can find a lot of positive aspects for the company.

Modern ERP/CRM systems exist as part of ERP, as it is broader in scope. In this case, the solution gives an important advantage to the owner - there is no need to integrate third-party products. Such CRM/ERP systems are ready to use and do not require modification.

Software solutions from different manufacturers can also be combined into a complex. However, it's worth noting that for the competent implementation of a unified CRM/ERP system, the owner will have to consult experienced specialists. This is not an easy task, and a mistake at any stage of the combination can lead to incorrect operation of the entire software.

Choosing CRM/ERP for your business needs

ERP vs CRM - the choice depends on the business model. This includes several criteria:

• the company's tasks: sales - CRM, ensuring deeper control of the enterprise - ERP;
• budget for integrating the system into business processes - complex solutions significantly increase the project price tag;
• ready-made product or custom software organization.

Of course, off-the-shelf software significantly saves the owner's budget and time. However, developing a personalized software model is a better solution. As the scale of the business increases, the owner will come to the conclusion that the issue of ERP vs CRM is no longer relevant - they need to be combined. If expansion is planned in the future, the development of a personalized system will be a promising solution for the future.