Comparing CRM and ERP solutions is like looking at the difference between apples and oranges. Depending on the business problem you’re trying to solve, it may make sense to pick an apple or an orange – or in most cases – both. While ERP (Enterprise Resource Planning) standardizes and automates the back-end functions of a business, CRM (Customer Relationship Management) supports the “front office” functions by collecting customer information to grow a business through increased sales, higher retention rates, and better customer service. Essentially – while there certainly is crossover – ERP helps you run your business efficiently, while CRM helps you grow your business.
Why wouldn’t I just use the CRM module of my ERP or an accounting system add-on?
CRM and ERP require a very different approach to each strategy and solution. As with a car needing both an engine and transmission to drive, most companies need ERP and CRM to grow effectively – they serve different, but critically valuable purposes. Another way of thinking about the difference is how you sell and market your services as compared to the processes you use to deliver them. Each area requires different approaches, skill sets, techniques, and more.
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A good CRM strategy follows a “flexible processes driving technology” approach, whereas ERP typically comes with embedded predefined processes. Most cross functional processes utilize information from both systems. However, CRM is usually a consumer and producer of customer information, but ERP is typically only a consumer. The table below highlights a few of the other differences:
|Manages customer interactions and touchpoints||Manages operational information|
|Benefits – Increased sales, service levels, customer acquisitions/retention||Benefits – Lower costs, growth scalability, compliance|
|Primary interface for customer facing staff||Primary interface for Operations staff|
|Requires flexibility to model complex customer relationships||Requires high level of standardization for efficiency|
|Supports “Owning the customer experience” approach||Supports efficient information management and access|
Why do I need to hire a CRM specialist?
Sticking with the car analogy, if the transmission on your car goes out, do you go to a general auto shop or a transmission specialist? What this means is that getting the most out of your CRM means hiring someone that has specific CRM experience and approach to make it useable, provide value, and help your people see the need for using it. Most IT vendors and accounting firms trying to implement CRM the same way as ERP would be like hiring the general auto shop. Adoption is one of the biggest hurdles to CRM success – and ultimately, the ability to grow your business. Hiring the right CRM partner can make all the difference.
While most organizations recognize their need for ERP, they don’t necessarily see the need to have a separate CRM solution. As a partner to many Michigan-based companies, DPT helps evaluate your unique CRM success factors and create a solution that works. Contact us to start a conversation.