Which system does your business need? ERP or CRM?

As a company grows, it becomes increasingly important to have effective systems and tools in place to manage various parts of the business. Two of the most commonly used tools for this are ERP (Enterprise Resource Planning) and CRM (Customer Relationship Management).

But what do these systems actually do, and how do you know which one is most suitable for your business?
In this blog post, we will go through what ERP- and CRM- systems are, the differences between them, and when you should use each system. Let’s dive in!

Content:

1. What is a CRM- system vs ERP- system?
2. The differences between ERP and CRM
3. When should you use which system?
    

1. What is a CRM- system vs ERP- system? 

Both CRM- and ERP- systems help businesses manage and streamline their processes, but they do so in different ways and with different areas of focus.

CRM (Customer Relationship Management) – Focus on the customer

A CRM- system is designed to manage and improve customer relationships. This tool focuses on understanding customers' needs, behaviors, and preferences to enhance efforts in sales, marketing, and customer service.

CRM- systems make it possible to track customer interactions, automate marketing activities and improve the sales process. With the help of a CRM- system, companies can better understand their customers' needs and behaviors, which in turn leads to increased customer satisfaction and loyalty.

ERP (Enterprise Resource Planning) – A comprehensive solution for the entire business

An ERP- system has a broader focus and is designed to help companies integrate and manage their various business processes.

With an ERP- system, companies can streamline their business processes and coordinate different departments such as finance, inventory management, production, procurement, human resources, etc. ERP- systems serve as a central platform for a company’s various departments and enable internal processes to be connected, creating a more efficient and coordinated workflow.
You can think of ERP- systems as the company's "nervous system" that connects all departments and provides an overall picture of the business.

For successful digitization with an ERP-system, companies must have well-structured workflows and business processes in order to fully utilize the system and get maximum value.

2. The differences between ERP and CRM

The main differences between the two systems can be summarized as follows:

Focus: The main difference between an ERP- and a CRM- system lies in their primary focus areas. A CRM- system primarily focuses on managing and improving customer relationships, while an ERP- system manages internal business processes.

Data: ERP collects data on a company’s internal processes, such as financial data, inventory levels, production data, etc. CRM collects data on customers, such as contact information, purchase history, and marketing activities.

Processes: An ERP- system can automate and streamline processes across many areas of a company, such as finance, inventory management, production, etc. CRM- systems automate processes related to sales, marketing, and customer service.

Users: ERP is used by multiple departments within a company, while CRM is primarily used by the sales, marketing, and customer service departments.

3. When should you use which system?

An ERP- system is a better option for companies that want to have an overview of the entire business, automate processes and minimize redundant tasks. It is especially useful for companies with complex business processes and many different departments.

A CRM- system is perfect for companies that want to manage and improve their customer relationships, streamline sales and create a more personalized customer experience. It is particularly useful for companies with high customer contact and who want a deeper understanding of their customers.

Summary

Both ERP- and CRM- systems are valuable tools for companies aiming to streamline their operations and processes. The choice of system depends on your company’s specific needs, challenges, and goals.
If you need a comprehensive solution to manage various aspects of your business, an ERP- system is a good option. If you want to focus on improving customer relationships and sales, a CRM- system might be the right choice.

In many cases, different ERP- systems already offer basic CRM functionality. In cases where this is not available, ERP- and CRM- systems can be integrated to create a more complete and efficient solution for the business.

Curious about which solution is right for your business?

Contact us for a consultation, and we’ll help you find the optimal solution for your company!

TIP:

1. Follow us on social media. We post on LinkedIn, Instagram & Facebook when we have updated with a new blog post. You can also get good tips and learn something new through the other posts we publish on social media, so you don't lose anything by following us!
2. If you want further knowledge and advice on the various systems and solutions, do not hesitate to contact us!
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/ Madeleine Olsson - CRM Consultant 🌷