Businesses that want to automate core business processes typically consider two software solutions: enterprise resource planning (ERP) and customer relationship management (CRM). ERP assists businesses in running successful businesses by connecting their financial and operational systems to a centralized database, whereas CRM assists businesses in managing how customers interact with their businesses.
Both serve as vital data storage facilities. Both cover a wide range of departments, and while they are sometimes built on the same platform, the software is frequently purchased separately and integrated as needed.
When you understand the fundamentals of erp crm meaning, your business growth will skyrocket.
ERP and CRM meaning ?
ERP and CRM systems track data and streamline core processes, working together to take your business to the next level. So what do erp and crm meaning?
What is ERP?
ERP is designed from material requirements planning (MRP) to focus on increasing efficiency of business operations by automating processes across all departments.
ERP functions as a shared database for all parts of an organization. Finances, including the general ledger (GL), accounts payable, accounts receivable, payroll, and financial reporting, are the core of ERP.
However, ERP also includes inventory management, order management, supply chain management, and data for service organizations. ERP also includes procurement, production, distribution, and fulfillment. Some ERP systems also include Human Resource Management Systems (HRMS), CRM, and ecommerce capabilities.
What is a CRM?
CRM, or customer relationship management, is software that manages all customer interactions with a business. CRM features were initially developed for sales departments and were sometimes referred to as sales force automation (SFA). Other systems were quickly developed to manage customer service interactions and marketing, particularly in the call center — or, as it became known, the contact center, once the telephone became just another customer service channel.
Software vendors began to combine all of these disciplines under one umbrella, called customer relationship management, through acquisition and development. Some CRM systems include sales performance management and sales incentive compensation, but due to their complexity, they are frequently sold separately.
The Key Difference Between ERP and CRM?
CRMs and ERPs both aim to improve a company’s performance—ERP systems focus on the entire organization, while CRM software focuses on the customer-facing side of your business.
- ERPs enable businesses to manage their core operations. Managers can automate and supervise daily accounting, project management, supply chain procedures, risk management, and compliance activities.
- CRMs help businesses improve their relationships with their customers. CRMs automate sales and customer service processes in order to improve the customer experience and boost profits.
What Is the Relationship Between ERP and CRM?
erp crm meaning are both tools for automating and streamlining business processes. A CRM system primarily manages the front-end of a business, whereas ERP manages the back-end processes. To work effectively and efficiently, erp crm meaning systems must collaborate to streamline the business’s front-end and back-office operations.
CRM can be thought of as a subset of ERP. CRM components are included in the majority of ERP systems, if not all. Integration of CRM functionality into ERP software will bring out the best in both systems, automating and streamlining customer interactions and providing greater visibility of all stages of the business process.
Which is better for your company?
Almost all growing businesses, from SMBs to enterprises, will eventually require both an ERP and a CRM system — or a single platform for both. Companies that manage their resouces planning, tasks and track workflow by spreadsheets frequently turn to an ERP system when they discover that this solution can save them a ton of time while boost their productivity significantly.
Also, businesses that manage their customer relationships in email clients, spreadsheets, or contact management systems used by individual sales reps. The business model of a company will determine whether it invests first in CRM or ERP. A company with a small number of high-value customers and complex financials may be more likely to invest in an ERP system first, whereas a company with relatively simple financials and a large customer base that requires frequent contact may do the opposite.
In the end, however, both systems are critical for the majority of businesses.
ERP and CRM System Integration
Erp and crm integration systems must be able to share data, which is best accomplished through technical integration rather than having two sets of data that must be maintained separately.
When attempting an upsell or cross-sell campaign, a sales representative, for example, may want to access a customer’s order history, credit status, or outstanding payments. When running payroll or bulk order discounts, the finance department may require access to the CRM system to calculate sales commissions. A CRM system built on top of an ERP platform also provides benefits to business leaders who may require a centralized way to examine pricing structures and manage key performance indicators (KPIs) such as customer acquisition costs and customer lifetime value.
Configure, price, quote is a common process that necessitates close integration between CRM and ERP (CPQ). Many businesses rely on CPQ tools, which require information from both CRM and ERP systems. The larger CRM and ERP vendors typically offer prebuilt integrations for one another, either directly or through a third-party partner. However, when the CRM or ERP system is upgraded, these integrations can be costly and difficult to maintain.
Benefits of ERP & CRM Integration
- Customer Visibility: The organization will have access to all aggregated information in order to make smarter, data-driven decisions in order to maintain and improve business relationships with customers, whether through sales, customer support, or marketing.
- Improved Efficiency: An integrated ERP platform with CRM system connectors or built-in CRM capabilities aids in the management of customer-related processes.
- Improved Data Accuracy: An integrated platform eliminates incorrect data, assisting in the improvement of business-wide data-driven processes.
- Employee Collaboration: Monitor and manage key performance indicators (KPIs) to ensure that the supply chain is operating at full capacity. Productivity, costs, fill rate, on-time delivery rate, and customer satisfaction can all be measured.
- Streamlined Sales Processes: With real-time data access, sales and operations teams can expedite the approval of customer contracts, maximizing business opportunities and delivering faster time to revenue.
MonsterOdoo – The solution integrating ERP and CRM for SMB
After discovering erp and crm meaning and benefits, the next question is which solution you should choose for your SME business?
While an ERP system helps automate operation processes and save overall costs, a CRM system directly helps drive sales and develop customer relationship.
At MonsterOdoo, you can find a cost-effective solution that allow fast, automated, and secure ERP and CRM integration to help you maximize the full benefits of your ERP and CRM investments.
Request a demo to experience how MonsterOdoo can strikingly improve your organization’s efficiency, profitability, and customer satisfaction.
