What is The Difference Between CRM and ERP?

Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) are different technologies but still similar in many ways, as they both are used to increase the overall profitability of a business.

These both are like two sides of profitability coins. ERP and CRM are similar in many ways, as they are both used to increase the overall profitability of a business.

Both the systems may overlap in some areas and can be completely integrated into others. Thus, their core functionalities are totally different from each other. It is best for a business to first look at them as separate, stand-alone systems.

Let’s look at how they are different from each other by understanding both the systems:

 

What is CRM?

Simply, CRM is the system which is used for managing a company’s interactions with current and potential customers. Talking about CRM,  we simply mean CRM software, used to organize, automate and synchronize sales, marketing, and customer service. It is the system or process to identify potential leads/prospects, nurturing them and guiding them through the sales process to close the business. The goal of CRM is to provide a comprehensive store of customer data that can be used to increase sales, improve customer retention, and make customer relations more efficient.

 

What is ERP?

Unlike CRM, ERP is used to manage the business. CRM manages customers. The system is for improving the efficiency of business processes. Just like CRM does, ERP also allows for the rapid sharing of standardized information throughout all departments.  Employees all enter information into the ERP system, creating a real-time, enterprise-wide snapshot. Problems in any area will automatically create alerts in other affected areas which allows departments to begin planning for issues before they become a problem in that department. In short, by allowing the business to focus on the data, instead of the operations, ERP provides a method for streamlining business processes across the board.

 

CRM vs ERP- The Difference

 

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You can use CRM software to manage any of the activities like manage the sales pipeline, calculate time spent on converting leads to closing deals, streamline your sales processes, automates customer service,
track a customer’s interactions with your business, share marketing and sales collateral, create data reports, learn which products sell best and when, prioritize leads, manage inventory based on historical sales data, collaborate to sell as a team, manage your business contacts, manage your business leads, share customer profiles with co-workers and See where leads come from.

On the other hand, ERP software helps to manage back-office activities and tasks including activities like Distribution process management, supply chain management, services knowledge base, configure, prices, improve accuracy of financial data,
facilitate better project planning, automate employee life-cycle, Standardize critical business procedures, reduce redundant tasks, assess business needs, accounting and financial applications, lower purchasing costs, manage human resources and payroll.

A lot of solutions available today that integrate ERP and CRM solutions to combine financial, operational, customer relations and business intelligence in one management system. Typically, CRM and ERP solutions in an organization, but when you integrate the systems to share data it can further improve operations management.

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By | 2018-08-06T10:39:18+00:00 October 28th, 2017|Categories: Uncategorized|Comments Off on What is The Difference Between CRM and ERP?

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Himanshu Jain is the founder of LegalRaasta – India's top portal for registration, trademark, return filing and loans.