Do not Confuse ERP with CRM
For a few years now, the use of many acronyms has been democratized in the digital and IT world. But what is really behind these acronyms? ERP and CRM, for example, are both business management software.
However, they have a very different function and use. It would therefore be wrong to place them on the same level.
In this article, we will highlight the distinction between the two and show how they can be essential and complementary within your company.
What is CRM?
CRM is the short name for Customer Relationship Management (not to be confused with Compliance and Risk Management). Simply and as its name indicates, it is a software that will allow to manage all the customer data that a company will have.
Note that we use the term “customer” in its broadest sense, which refers not only to new customers, loyal customers but also to leads.
Thus, thanks to a CRM, all interactions between the customer and the company are recorded and centralized to allow an optimal follow-up.
Why Implement a CRM?
The main objective of the implementation of a CRM is to have a competitive advantage. Indeed, today, the customer experience is a decisive criterion in the popularity of a company. We call customer experience the set of emotions that the customer can feel from the first contact with a company.
Thanks to CRM, the customer is recorded from his first contact with the company. All his data are recorded to improve the experience over time.
Let’s take the example of the Internet. You subscribe to a service and need the customer service to solve a problem. The latter will be all the more efficient thanks to all the information collected beforehand (subscribed package, possible previous problems…).
What are the Similarities and Differences between a CRM and an ERP?
ERP and CRM are two centralized information management systems. They allow easy access to information and the ability to use and automate it to improve the company’s productivity and facilitate decision making. But the similarities end here
Like CRM, ERP is a software that centralizes a very large amount of information. But this information does not only concern the customers but all the company’s assets in the different business processes:
- Human : customers, employees…
- Financial : invoices, accounting
- Materials : stock…
The ERP will therefore be used by all departments while the CRM will be mainly intended for the sales and marketing departments… The objectives will therefore be different. For the ERP, it will be about optimizing the management of internal resources while for the CRM, it will focus on marketing/sales objectives and strategic sales planning.
Finally, the implementation of a CRM is often much less cumbersome than that of an ERP which involves more people, more branches… Logically, the training on the latter will be longer which also explains the implementation time.
Can CRM and ERP Work Together?
The answer is yes. In fact, there are two options available to you:
- Integrated with a CRM and an ERP that work together
- Non-integrated with two separate systems. This will be appropriate for small companies with few customers
As you can see, the joint integration of an ERP and a CRM can bring a lot to your company:
- A 360° view of human resources and the processes they are involved in, whether we are talking about a customer with a sale or even an employee on leave. Real-time updates in both systems allow for efficient follow-up
- The ease of establishing prices that take into account customer, stock, raw material costs…
- Linking all company data with customer data to set up clear objectives and decisions and plan future actions
- Less work on the data. There is no duplication of work, which avoids duplication.
SAP offers, for example, SAP Customer Experience and its flagship product SAP C/4HANA, which integrates seamlessly with the German firm’s ERP. Data can be exchanged easily, even if the customer’s request involves several departments.
Connected to S/4HANA, C4/HANA takes advantage of all the benefits of the innovative ERP, from the in-memory database to the multiple automation functions. To learn more about S4HANA, please read our article.
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