[Infographic] ERP vs. CRM: Which One Do You Need?

When it comes to choosing your business software, two things instantly come to mind: Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM). ERP and CRM integration is an essential solution that can boost your business’ overall profitability.

While the two systems are similar in several ways and feature powerful tools that even overlap, their core functionalities are different. As such, we’re going to explore the differences between ERP and CRM and find out what they might mean for your business. Read on to see our comparison and contrast.

What is ERP?

ERP is designed to improve the efficiency of your organization by streamlining your business operations to reduce costs.

ERP’s core functionality is the interconnected management of your business processes. With ERP, your organization can enjoy increased visibility as it allows the standardized sharing of information across departments in real-time. Any issue in one area will automatically send alerts to other areas and your team can start planning the resolution before the issue gets even bigger. By letting your business focus on data, your team can make fewer errors and make better decisions.

What is CRM?

CRM is designed to increase sales by managing an organization’s interactions with its current and potential customers. A CRM system standardizes data that can be shared across different departments. It organizes, automates, and synchronizes sales, marketing, and customer service.

With a CRM system, you can develop and monitor all aspects of the customer experience. By ensuring high-quality customer service, you can keep the customer happy and earn their invaluable loyalty to your business. Moreover, CRM also enables you to create sales projections and identify potential leads or prospects, nurture and guide your prospects through the sales funnel, and encourage them to close the transaction. Maintaining good customer relations can help your business enjoy repeat orders or orders of higher value.

What’s the difference?

ERP and CRM integration are both useful in increasing your business’ profitability and improving efficiency in your business processes. ERP reduces overhead costs by streamlining your business operations while CRM works by improving customer relations and producing greater sales volume.

Enterprise Resource Planning (ERP) is a software designed to improve your organization’s efficiency by streamlining your business processes.

The ERP system has a holistic approach to managing all business procedures. With an ERP system, your company’s data becomes consolidated, manageable, and accessible to all key recipients across departments. This system is especially useful for large and complex companies to growing medium-sized businesses.

Customer Relations Management (CRM) is a software designed to increase your organization’s profitability by managing your customer relations and streamlining all marketing activities.

The CRM system is customer-oriented and provides a standardized collection of customer data and documents customer interaction. This allows your company to develop sales forecasts, identify potential leads, improve customer service, and generally increase sales by maintaining a good relationship with your customers.

Which one do you need?

ERP and CRM integration are both important if you want to maximize your company’s growth but choosing which one to implement first can be taxing, considering that both systems have their share of key advantageous features. While sharing many similarities, they also scale differently.

For large and complex companies, an ERP system is a good investment as it can provide benefits by improving business efficiency and reducing costs. Meanwhile, a CRM system can be more beneficial for small to medium-sized businesses that need a huge boost in raw sales.

Generally, the choice will still ultimately depend on your company’s needs. But because many organizations need to reduce costs and increase sales at the same time, most integrate both systems.