ERP (Enterprise Resource Planning) and CRM (Customer Relationship Management) applications are two types of software that are often mission-critical solutions to have for growing and midmarket businesses. However, trying to choose one – or both – often presents considerable confusion for those unfamiliar with the functions of either system and without an IT department or consultant to help. What is especially important about making this choice is that both systems also work the best when integrated seamlessly with each other, and when they are not it becomes a persistent pain point to overcome.
Leveraging decades’ worth of experience in software consulting, SWK Technologies has put together this comprehensive guide to help you better understand the difference between Enterprise Resource Planning and Customer Relationship Management software:
Understanding ERP vs CRM
The most effective way to understand the difference between ERP and CRM is through the lens of where each software type operates within your business ecosystem. These solutions ideally should complement each other’s uses, addressing different operational needs internally and externally for your organization.
To give you a better idea of how each functions, here is a basic overview of what they do:
What is ERP?
An ERP is an accounting system that also provides several business management capabilities that are particularly valuable for organizations with multiple stages in their operations, such as manufacturers or distributors. These applications integrate and automate many critical back office functions, including:
- Financial Management: General ledger, accounts payable, accounts receivable, financial reporting, and budgeting processes that provide real-time visibility into your business’s financial health.
- Inventory and Supply Chain: Warehouse management, procurement, vendor relationships, and inventory optimization that ensure the right products are available when customers need them.
- Operations Management: Production planning, resource allocation, project management, and workflow automation that streamline how work gets done across your organization.
- Compliance and Reporting: Automated compliance monitoring, regulatory reporting, and audit trail maintenance that reduces risk while ensuring accuracy.
What is CRM?
A CRM system collects, stores and maintains customer-related data, which will often also include information from prospects, partners, etc., giving you a repository for account-related details in one database. These systems help you to optimize front office, client-facing functions such as:
- Sales Management: Lead tracking, opportunity management, sales pipeline visibility, and performance analytics that help sales teams close deals faster and more effectively.
- Marketing Automation: Campaign management, lead nurturing, customer segmentation, and marketing ROI measurement that drives qualified prospects to your sales team.
- Customer Service: Case management, customer communication history, service level tracking, and support team coordination that ensures exceptional customer experiences.
- Relationship Intelligence: Customer behavior analysis, communication history, preference tracking, and interaction management that enables personalized customer engagement.
The Fundamental Difference for ERP and CRM Software
ERP provides you with an operational foundation that enables efficient, connected business processes, while CRM systems let you build a framework for customer engagement to nurture growth and retention effectively. The distinction becomes important when planning software implementations and determining which departments will primarily benefit from each solution. However, the best ROI will come when these applications are working in sync and exchanging data seamlessly.
Identifying Your Business Needs – ERP vs CRM Users
The first step to identifying which system you need and when is to understand who in your business will be using what:
ERP – Accounting and Operations
ERP solutions typically benefit your accounting and operations departments the most, as well as any managers overseeing inventory, warehouse or production management as these processes will need to be connected with each other as well as financial reporting workflows.
CRM – Sales and Marketing
Sales, marketing and customer support departments will often get the most use out of your CRM software, though much of the information it collects and stores can still benefit other business functions depending on the data and integration quality.
Both – IT and Leadership
Many businesses rely on their IT departments – or outsourced service providers – to manage their software inventory, which typically centers on ERP and connected solutions but can also include CRM applications. While not always directly involved in day-to-day processes, executives and managers from different teams will also often be engaged with the activities and data flows for these systems.
Integration for ERP and CRM – Different Approaches
Integrating your software applications effectively allows you to eliminate data silos between your teams and empower them to collaborate more efficiently. However, there are different approaches for achieving this with ERP and CRM systems, depending on the products you choose:
Native CRM Integration
Some enterprise business management solutions come with their own parallel Customer Relationship Management apps, making it easier to merge the separate databases and create a unified ecosystem.
Example: Acumatica ERP and CRM
Acumatica stands apart in the ERP market by offering robust, built-in CRM functionality as part of its core platform. This native integration eliminates many traditional challenges while providing comprehensive customer management capabilities. This approach particularly benefits companies where sales processes are closely tied to operational activities, such as manufacturing or distribution businesses where inventory availability directly impacts sales conversations.
Best-of-Breed CRM Integration Options
Some solutions opt to prioritize specific functionality over broad, while still allowing for connectivity with a wider range of third-party applications. Leveraging open API architecture, these systems allow you to create a “best-of-breed” ecosystem rather than be beholden to one product portfolio.
Example: Sage Intacct and Salesforce, HubSpot, etc.
Rather than attempting to provide every function internally, Sage Intacct excels at financial management while connecting efficiently with dedicated CRM platforms. It integrates with Salesforce for customer management, HubSpot for marketing automation or other specialized platforms available through the Sage marketplace. These integrations leverage Sage Intacct’s robust API architecture to maintain data consistency while enabling best-in-class functionality across applications.
Working with a Consultant to Choose the Right Software
Choosing the right ERP and CRM systems that both meet your needs and integrate seamlessly with each other can be a challenge if you do not have any extensive knowledge on which potential applications will fit your needs. Every business has unique operational requirements, industry-specific demands and growth objectives that are going to influence your technology selection, and ultimately your ROI. This is where working with an experienced consultant will benefit your search greatly.
What to Look for in an Implementation Partner
Not all implementation partners offer the same level of expertise or quality of service. When evaluating potential consultants, focus on these key qualifications:
- Multi-Platform Expertise: Partners with experience across different ERP and CRM platforms can provide objective guidance based on your specific needs rather than pushing particular products
- Industry Knowledge: Implementation partners familiar with your industry understand common pain points, regulatory requirements, and best practices that generic consultants might miss
- Integration Experience: Partners with extensive integration experience can help you build cohesive technology stacks rather than disconnected applications that create new silos
- Ongoing Support Capabilities: Post-implementation support ensures you continue getting value from your investment as business needs evolve and systems require updates or modifications
Let SWK Technologies Help You Choose Your Best Software
SWK Technologies has helped thousands of businesses successfully implement software systems that empowered their teams to streamline their manual processes and enable success. Reach out today and see firsthand our expert consultants can give you peace of mind when it comes to maximizing your ROI on your software selection.
Contact SWK here and discover how our team of experts will help you get the most out of your technology investment.