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What is the difference between ERP and CRM?

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September 8, 2022

When business software solutions are on your radar, you are likely to encounter both ERP systems and CRM technology. The common ground between the two is that they are aimed at helping you with automation, revenue generation and productivity gains. But the methodology and sheer scope of these systems to achieve those goals is very different and you need to understand this when comparing ERP and CRM.

In this post, we’ll look closely at what is involved with ERP and CRM software, exploring how they differ from one another and helping you understand which might be better for your organisation.


What is ERP?


Enterprise Resource Planning (ERP) software is a holistic solution with tools and resources for accounting, distribution, inventory management, supply chain, manufacturing and much more. It integrates these disparate processes with the goal of streamlining operations and placing all information in a centralised location. Systems can usually be configured and customised, with additional functions and modules available to meet your specific operational needs.

ERP solutions are often used by larger enterprises but can also be useful for smaller businesses. An ERP system typically contains tools relating to both front and back-of-house information, along with resources to enhance data exchange and internal communication. It features strong automation capabilities, powered by its connecting of multiple workflows.

For a more in-depth look at ERP, please read our article What is ERP Software?


What is CRM?


Customer Relationship Management (CRM) software is designed to help businesses manage their customers better, maximise on sales opportunities and improve customer experience. This is achieved through a range of approaches, including automated marketing communications, improved ad targeting, upsell and cross sell and much more. CRM systems are front-of-house tools for departments like marketing and sales, aimed at increasing revenue by improving customer experience. The principle is that a solid and expanding customer base is fundamental to business success.

These systems can be implemented as standalone software or as a part of a broader ERP solution. Some providers offer the ability to incorporate a standalone CRM system with more beneficial or relevant technology that boosts functionality and empowers businesses to create bespoke solutions.

To learn more about CRM software, please read our article Customer Relationship Management (CRM) Software Explained.


What are the key differences between ERP and CRM?


When considering ERP and CRM systems, it’s crucial to understand the main distinctions between them. The most obvious is that an ERP can facilitate business process improvements across multiple workflows. If your goal is to implement systems that will bring about improvements to accounting, warehousing and other operations, ERP may be the option for you.

CRM, on the other hand, is a more specific marketing solution. Many ERP solutions include some CRM features either as standard or as an added module, but a standalone CRM will usually include more customer-based features than what you’ll find in an ERP package. What it all comes down to is scope – when considering ERP vs CRM, you must examine your organisation’s needs in detail and identify the functionality you need from your software.


Common Features of ERP Software



Accounting tools and financial management are core features of ERP systems. This is the engine that drives various other business processes. The financial tools of ERP solutions make it sustainable and compliant with budgetary requirements. Specific functions include accounts payable and receivable, fixed asset management and a general ledger. There may also be tools to help with financial forecasting, budget development and tax calculation.


Supply Chain Management

This provides a robust set of tools. One key component will be inventory management, which we discuss below, but this will be combined with things like distribution, purchase orders, regulatory compliance, quality monitoring and manufacturing. There are many different features and technologies that could relate to this area, and the connection between different tools and resources will vary between vendors and be available for customisation.


Inventory Management

Inventory management capabilities could include the function to allocate automatic notification of low stock levels and/or reordering points. The feature is usually closely paired with things like warehouse or manufacturing management and distribution to create a more comprehensive solution. With the power to manage and monitor inventory alongside visualising the status of the machines that manufacture your products, you have a superior overview of the production process.


Human Resources

Efficient people management is a common feature of ERP software. HR tools can include capabilities relating to distributing wages, scheduling shifts and approving requests for sick leave and PTO. Some systems may also include project management tools for looking at the projects staff members are working on whilst allocating resources where they are needed.


Customer Relationship Management (CRM)

The details of this will be discussed in detail in the next section, but you should be aware that some ERP vendors do supply systems with CRM functionality to varying degrees. In most cases, the capabilities will be less advanced than those of a standalone CRM solution, but when your CRM needs are more basic and you need solutions for other processes as well, ERP could be the right choice.


Common Features of CRM Software


The primary objective of CRM is to nurture leads and enhance the customer experience as they develop into prospects and, hopefully, returning customers. Here are some of the most common features:


Client Interaction Tracking

This enables the tracking of historical client data to develop the sales process. Sales reps may segment potential customers on the basis of interests, buying behaviour and purchase intent via the tracking and viewing of payments.


Contact Management

Track and edit customer data, and add contacts to various accounts or assign them to different representatives. You can monitor the client’s role in making purchases for their company, and the tool can store invoices, contracts and other key documents relating to individual customers. For example, you might know your customer is running low on printer toner before they even do!


Marketing/Campaign Management

Targeted advertising is crucial to modern marketing. This way, you can find potential campaign targets and measure how effective those campaigns are. Some vendors enable the programme to integrate with email applications to upload contact information for the sending of email marketing communications.


Database Management

This enables users from across the organisation to access information from a centralised location. Some will offer data cleaning capabilities to eliminate duplicate data for developing accurate insights. Information can be downloaded to other workflows within the company to aid with analysis and prospect development.


Lead Management

This can help gain leads from multiple sources like email, referrals or landing pages. Lead routing can be set up to examine how leads progress through the pipeline, along with territory management tools and hierarchy relationships.


Standalone CRM or integrated ERP?


The choice between these two revolves around whether you need tools for other departments and how robust your lead management and sales tracking requirements are. ERP solutions can help with many business operation management tasks, but standalone CRM systems usually include a superior set of customer-related features than what you would get with an ERP system.

If all you need is the CRM functionality, a standalone CRM may be your best bet. But if you also need to facilitate workflows like finance, distribution, HR and accounting, an ERP with CRM functionality or an ERP with an integrated standalone CRM will be your better option.

Ultimately, both are great tools for optimising your revenue. But there are distinct differences in the specific purposes they serve. ERP is a more comprehensive solution centralising disparate front and back-of-house processes, whilst CRM primarily focuses on sales, marketing and customer relationships. The scope of your needs and the size of your budget will be the main things that dictate the programme that is best for you.


Why choose Eventura for your business systems project?


Eventura has been providing robust business solutions to countless organizations for over two decades. We are ERP experts and can identify all of your business needs, and deliver a comprehensive ERP solution that works for you.

As Sage 200 Partners and NetSuite Solution Providers, we can help you identify which solution will fit your business needs the best. Our expert team of business analysts, developers, consultants, technicians and support staff can guide you through your entire project, from initial scoping through to implementation and on-going support.

We’re also managed IT service providers meaning we can help you identify your entire IT infrastructure requirements from day one. If you would like to speak to one of our ERP experts, you can request a free call back here.

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