ERP vs CRM – Which One Do You Need?

ERP and CRM are each necessary instruments for enterprise course of automation and general streamlining of processes. Learn the way they differ.

ERP and CRM are each necessary instruments for streamlining enterprise processes. They’re each linked to a corresponding relational database and each of them assist companies make data-driven choices. The similarities finish just about there. Though the phrases ERP and CRM are sometimes used concurrently, typically even to imply the identical factor or to precise the identical thought, however as we’ll discover out, they’re two very totally different entities.

What’s ERP?

ERP stands for Enterprise Useful resource Planning. It it’s the successor of Materials Requirement Planning of the older instances. The idea of ERP may be very easy on the core. It accumulates knowledge from totally different departments of a enterprise and makes them accessible by authentication as a way to create a single supply of reality.

How does an ERP system work?

LEt us break that down a little bit. Allow us to say, you run a restaurant chain with 17 eating places scattered throughout 6 cities in 3 states. Now, every department of the restaurant has a separate ledger to report monetary knowledge. Every of them has a documentation of uncooked materials that’s procured and the objects which are bought. Each department has totally different necessities by way of workers, menus, recipes. Every of them have totally different overhead prices for electrical energy, and upkeep.

ERP helps you collect the data from all 17 branches right into a single platform with an interactive interface. This lets you monitor what’s taking place at every of your eating places. You’ll be able to simply entry details about revenue, losses, necessities, and so forth. Extra necessary, your ERP system can warn you at any time when there may be discrepancy between the identical knowledge coming from two totally different sources. 

You’ll be able to detect patterns in knowledge and make viable predictions in regards to the enterprise’ future with a strong ERP instrument. 

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What’s CRM?

CRM stands for Buyer Relationship Administration. It refers back to the course of in addition to the system employed to handle the interplay between the enterprise and its clients. A CRM instrument is used to build up the contacts, categorize them, rating them based mostly on the opportunity of conversion, automate newsletters, course of invoices, and whatnot.

ERP vs CRM - Which One Do You Need?

How does a CRM system work?

If we merely look into the way in which companies purchase clients, we can admire the function a CRM system performs. Gross sales folks purchase e-mail lists from totally different sources, typically they purchase such lists. They get e-mail IDs and telephone numbers of people that is perhaps within the enterprise by the advertising and marketing web site and touchdown pages, they create an inventory of potential clients. 

They need to name every of them, assess the opportunity of changing them into clients, make followup calls, report the progress, let different crew mates know the progress, design additional gross sales materials to upsell or improve an current relationship.

The method of changing lists into leads, leads into clients and clients into loyal clients, typically comes all the way down to the standard of interplay your small business has with a possible buyer. 

CRM means that you can streamline, standardize, and scale these processes. It helps you to automate lots of processes like elevating alerts when a buyer responds to an e-mail, updating buyer data in numerous pages of a CRM platform, amongst different issues.

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ERP vs CRM: The distinction between ERP and CRM

On this part we’ll examine ERP and CRM by way of who makes use of them, and the way a enterprise advantages from them.


ERP is usually utilized by the monetary groups that create the final ledger of a enterprise. The C suite executives may use ERP to entry details about their enterprise. Since, ERP touches each side of a enterprise from stock administration to financia closure, virtually everybody can use ERP in some capability.

CRM is sort of solely utilized by gross sales and advertising and marketing groups. 


ERP has a big set of attention-grabbing advantages.

  • It helps you take away discrepancies from accounts
  • It means that you can handle stock higher
  • You need to use it for HR administration
  • You shut the financials quicker since ERP integrates the processes
  • ERP typically has a CRM element which permits buyer interplay administration

CRM brings its personal set of advantages

  • Gross sales course of automation
  • Buyer scoring and categorization
  • Alerts and reminders to contact and observe up clients
  • Advertising course of automation

Which one do you want?

ERP vs CRM, it’s tough to decide on one or the opposite. Some companies have processes scattered throughout departments and so they want a type of administration mechanism to  convey all that collectively and get managed entry to the precise data. They’ll want a strong ERP instrument. With a CRM they are going to be capable of handle the client interactions higher. One of the best step ahead is to combine CRM and ERP – you’ll be able to choose and select options from each the instruments and create a customized answer for your self.

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