Businesses need software like CRM and ERP to automate core business processes to remain competitive. ERP and CRM provide your business with crucial data repositories. ERP links financial and operational systems to a central database, while a CRM system manages customer interactions.
In this article, we will discuss ERP and CRM, some key differences, and the benefits of integrating into your business.
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What is CRM?
Customer Relationship Management (CRM) software is a valuable tool for businesses of all sizes. It acts as the hub of all the customer information for different departments within your company. It provides an easy way to organize and manage your leads, customer information, and sales processes.
CRM software simplifies many functionalities by bringing the entire workforce on the same page. By leveraging the benefits of this technology, you can maximize efficiency, and improve customer loyalty.
CRM even helps to manage social media marketing and advertising, popularly known as social CRM.
What is ERP?
Enterprise Resource Planning (ERP) software is a powerful tool for business owners, offering a centralized platform to manage all facets of their operations. Its main function is to enable efficient data exchange across departments and streamline the workflow, from procurement and inventory control to customer relationship management and financial reporting.
ERPs can also handle production, logistics, and fulfilment. Many ERP software packages also provide human resources management, CRM, and eCommerce software. With ERP software, you can leverage technology to automate processes, cut operational redundancies, optimize performance and drive profitability.
Key Differences between CRM and ERP
CRM and ERP systems offer powerful solutions for business owners, but they have distinct differences that make them more suitable for different types of organizations.
- CRM solution is designed to improve customer relationships by providing an efficient way to store and analyze customer data. It also helps with automating marketing campaigns, tracking leads, managing sales activities, improving service delivery processes, and creating personalized experiences. In comparison, ERP is focused on automating internal operations such as finance management, procurement process optimization, and inventory control.
- Both systems involve collecting data about customers or clients, but the purpose of gathering this data is different: CRM tool tracks sales opportunities over time to identify trends and build better customer relationships, while ERP seeks to improve efficiency by optimizing inventory levels and cutting down on superfluous costs.
- ERP and CRM systems help to increase organizational profits. While the two systems share a common goal of improving business performance, they take different approaches to achieve success. ERP systems are designed to reduce overheads and cut costs through automation. By streamlining business processes, ERP solutions make operations more efficient and lead to higher profits. Whereas, CRM aims to improve customer loyalty, and create better relationships with customers, thereby increasing profits.
- Front office tasks, like customer service or sales, are handled by CRM software for resellers. ERP software, in contrast, is specifically designed to support back-office processes or departments that do not deal with customers.
CRM and ERP Integration
The purpose of ERP and CRM integration is to share automated, consistent, and accurate information between both systems. ERP and CRM are two fundamental business applications used by organizations. When integrated, they create an efficient flow of data between departments and personnel, into one common system.
This type of integration sets the foundation for professional services for customers because it provides visibility into customer purchase history as well as up-to-date inventory information.
Benefits of ERP & CRM Integration
Regardless of whether you’re an enterprise or a small business, ERP and CRM software for VARs offer many benefits. By integrating both, companies can take advantage of the best of both worlds. Here are some benefits of ERP-CRM integration:
1. Customer Visibility
By gaining unified access to customer data, you can gain a better understanding of customer preferences and activity.
2. Improve Efficiency
Managing customer-related processes is an essential part of any successful business. But, it is difficult to maintain a streamlined workflow when siloed systems are in place. An integrated ERP platform with prebuilt CRM system connectors will improve efficiency and ensure that customer-related processes run smoothly.
3. Boost Employee Collaboration
With a connected, integrated team, all employees can access the same data in real-time. This helps when interacting with customers or gaining information about them.
4. Improve Forecasting
Your forecasts have improved accuracy when all vital financial information is stored in your ERP system. With quality data, sales representatives can conduct more accurate analyses of their current sales opportunities, as well as gain insights into potential buyers’ interests and buying behaviors.
5. Save Hours on Your Sales Pipeline
You can simplify processes by using up-to-date and centralized information. Real-time data allows sales and operations teams to speed up contract approvals, resulting in improved business opportunities.
The Bottom Line
ERP systems and their CRM counterparts are two of the most popular and successful business automation technologies. Both share common goals and fundamental functionality, but several key differences make them more suitable for different types of businesses.
When you integrate ERP and CRM solutions, you can take advantage of the best of both worlds. ERPs are designed to reduce overheads and cut costs through automation. By streamlining business processes, ERP solutions make operations more efficient and lead to higher profits. On the other hand, CRMs are focused on improving customer loyalty, and building better relationships with customers, thereby increasing profits.