ERP Vs CRM: The Ultimate Guide
Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) are both software systems that play crucial roles in managing and improving different aspects of a business. While there are overlaps in functionality, they serve distinct purposes within an organisation. ERP and CRM help optimise business systems, but a company’s needs determine the best system. An ERP is ideal if your company goals are streamlining production, financial and inventory management.
If you would like to read more information or learn more about the pricing of CRM Systems, you can do so here.
Critical Differences Between ERP Vs CRM
- Focus: ERP focuses on optimising internal processes and overall business operations, whereas CRM focuses on improving external relationships with customers.
- Functionality: ERP is broader and includes a wide range of functionalities to manage internal processes, while CRM is more specialised, concentrating on customer-facing activities.
- Integration: ERP integrates data across various business functions, providing a unified view of internal operations. CRM focuses on integrating data related to customer interactions.
- Departments Involved: ERP is often used by multiple departments like finance, manufacturing, and HR. Sales, marketing, and customer service teams predominantly use CRM.
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|Best for usability
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- Freddy AI tool gives you insights
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|Best for features
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- Automated reports included on free plan
- User permissions available for larger teams
- 21 features available on free plan
|Best for contact management
|£14.90 per user
- Unlimited contacts permitted
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- Fast-loading dashboard for large datasets
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- Salesforce Inbox
10 user limit
- Automatic data capture
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|Best for dashboards
|£7 per seat
- Widgets available for bespoke metrics
- Unlimited contacts and dashboards
- Huge range of CRM board templates
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|Best overall CRM provider
|Free or £17 (flat rate)
- Thorough 12-step onboarding process
Chatbots, email campaigns, and webforms
- Send 2,000 emails per month
- 5 active contact lists for campaign outreach
ERP Vs CRM: Customer Relationship Management
Customer relationship management is a business strategy and software that helps companies manage customer relationships, cultivate loyalty, streamline sales processes and drive sales growth. CRM is an integral part of any company’s digital business.
While “customer relationship management” can refer to a business’s strategies and processes, it most commonly refers to customer relationship management (CRM) software. CRM software organises customer and lead information, including contact details and communications records. It provides analytical tools that help marketers, sales reps, and other functional members of a company’s team improve their day-to-day interactions with customers and leads.
CRM systems can also be used to prioritise and segment a company’s customers based on current profitability and future potential to generate referrals and repeat business. A company may also use its CRM system to send data between different applications, such as a call centre system looking up an incoming customer’s phone number in the CRM database and automatically populating that information on the agent’s screen, allowing them to greet the customer by name and better understand their needs and history with the brand.
An operational CRM can also automate marketing tasks such as designing, distributing and tracking email campaigns. It can also support the sales process with tools like lead management, sales forecasting and managing follow-up communications with potential consumers or vendors. This can directly impact the company’s bottom line by increasing product/service sales or decreasing expenses and overhead costs.
ERP Vs CRM: Inventory Management
Inventory management involves balancing inventory levels to ensure the right amounts of products are available for sale. Effective inventory management can reduce costs, improve cash flow and increase customer service. Small businesses typically keep track of inventory manually and determine reorder points using spreadsheet formulas, while more giant corporations use specialised software as a service (SaaS) applications. The best tools help you streamline workflows for maximum efficiency and minimise the need for manual data entry.
Depending on the type of business, you may implement one or more inventory control methodologies, such as FIFO (First In, First Out), LIFO (Last In, First Out) and VED (Value Everyday Disposition). The methods impact how your business values inventory and can have significant consequences.
A common problem is overstocking, which results in money tied up in unsold stock that can’t be sold and can eat into your profit margins. On the other hand, understocking can lead to disappointed customers and lost sales. The solution is a sophisticated inventory management system that gives you more significant insights into the inventory balance and enables you to react accordingly.
A modern cloud inventory management solution synchronises production, planning and inventory with real-time visibility into stocks throughout the supply chain. It enables multi-location fulfilment, demand-based replenishment, cycle counting, and lot or serial tracking. Choosing a solution with a proven track record and scalability is essential to meet your needs.
ERP Vs CRM: Financial Management
Financial management consists of several essential aspects, such as budgeting, forecasting, managing and controlling a company’s financial resources and cash flow. It aims to maximise investors’ profits by optimising the firm’s money usage and reducing expenses. It is also responsible for assessing the need for capital and evaluating the returns on investment.
Financial managers are also tasked with ensuring the company has enough liquidity to meet short-term needs. They do this by analysing potential risks to the company’s financial stability. They may also need to assess the risk of new investments or expansion opportunities, such as buying a warehouse to accommodate more inventory.
Another critical aspect of financial management is establishing a stable work relationship with other departments. This ensures that the company is operating efficiently and meeting its financial goals. It also helps to reduce production delays. To do this, financial management professionals need to create a system that evaluates and distributes funds according to specific procedures.
The finance department can automate these manual processes using cloud ERP and focus on strategic analysis and decision-making. It can also provide real-time visibility into the financial state of a business and facilitate day-to-day operations, including period-end close processes. This helps companies maximise profits while keeping up with regulatory requirements. It can also help eliminate manual data aggregation and duplicated reporting, allowing for more accurate financial statements.
ERP Vs CRM – Other Useful links about CRMs here:
What Is CRM and Why Is It Right For Your Business?
Is CRM Software Is CRM Software?
Is Excel a CRM Tool?
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