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An interesting question: ERP vs CRM

How do you define them, and today is there much of a difference?

Answers

Robert Meybohm
Title: Owner
Company: Meybohm & Bodell, LLC
LinkedIn Profile
(Owner, Meybohm & Bodell, LLC) |

I think they are two different topics; ERP being associated with the discipline of sourcing materials and doing planning associated with the priduction of goods; an extension of the old fashioned MRP runs done in the original systems. So this is about the stuff being made. CRM is more about the pipeline of what is coming as far as orders; potential orders; customer buying habits and patterns. This is the sales side; who buys the stuff. In a perfect world(ha!) CRM would feed some Intel to ERP to help make decisions as there is information there about what is going to be purchased in the future. I doubt anyone is doing an excellent job of linking the two.

Mike Haile
Title: Founder
Company: Haile Consulting Solutions
(Founder, Haile Consulting Solutions) |

I think that Robert's response is pretty comprehensive. There are a few companies that provide both but they are different systems and are almost always sold sparately. Another way to look it is that the ERP is typically "owned" by the finance dept and the CRM by the marketing dept. There is a lot more to it than that but its a simplistic way to look at it.

Topic Expert
Joan Varrone
Title: CFO
Company: Cloud Cruiser
LinkedIn Profile
(CFO, Cloud Cruiser) |

NetSuite has an integrated accounting system and CRM application

Anonymous
(Manager) |

I think NetSuite does a pretty good job of integrating the two, especially if implemented to do so. About 5 years ago I worked for an organization that went to NetSuite for almost everything - we ended up getting rid of 5 other software programs (2 for accounting/finance, 1 for sales, 1 for customer support, 1 for internal tech support). So, we spent about 6 months looking at all of our processes to see how they could be improved and made more effective by utilizing the software. Then we spent about 6 months testing to make sure it would all work for us. It resulted in the best utilization of software I've ever seen. Sure there were things that changed and people didn't love it for awhile, but overall it allowed management to have great insight and it was incredible to see the whole "story" of a customer when an issue arose.

So, to answer the original question, I still think there is a big difference in the two, but I think they work best when they are combined in such a manner that you almost have trouble distinguishing them.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Actually Joan, there are many systems that have full integrated CRM systems. Are they "more" fully integrated than NetSuite (or work better) is a subjective viewpoint, but NetSuite is not the first or last to blend these two systems together.

And regardless as to the quality of the marriage on the software side, it is the implementation and utilization by the end-user which ultimately decides whether the marriage will work and whether the software is "good" or "bad".

Again, subjectivity.

Mark Matheny
Title: VP - FInancial Planning and Analysis
Company: Novolex (formerly Hilex Poly)
(VP - FInancial Planning and Analysis, Novolex (formerly Hilex Poly)) |

I think it depends on how they are used. They can be two independent business tools and some companies like it that way. The ERP is more inwardly focused and the CRM more outward. Or, they can be "joined at the hip" and be directly integrated or at a minimum communicate with one another. I do think the lines are blurring.

Brian Lounds
Title: Director
Company: Professional Solutions Group
(Director, Professional Solutions Group) |

I think it is an interesting post. As an ERP consultant focusing in finance I see these lines getting more and more blurred as the depth and breadth of solutions built on top of the various CRM platforms continues to expand. While the heavy lifting of Material planning and financial tracking still remains in the ERP realm there are certain industries where the primary ERP solution is built on CRM platform with much smaller footprint in the ERP for finance or basic back office functions.

It is very clear the two worlds are overlapping more and more and as such finance teams will have to be more involved in CRM as it takes on more of the processes that impact financial operations.

Ned Lilly
Title: CEO
Company: xTuple
(CEO, xTuple) |

It's hard for me to see a situation where you wouldn't want your CRM users to at least have the option of having real-time visibility into operations - what product is available to promise (or even reserve, if made to stock) when you're with customers or prospects? Having customer-specific pricing and credit information available when making a quote? Or, on the customer support side, having trouble tickets fully integrated with returns management? And of course, at the most fundamental level, recognizing that the C in CRM doesn't just stand for Customer (at xTuple, we say "Corporate Relationship Management.") There are still systems out there that don't understand a world where a company can be, for example, a vendor and a customer.

Finally, there's always a pendulum swinging back and forth from fully integrated solutions (which would argue for ERP and CRM being the same database), to "best of breed" (where more specialized functionality might be desirable for each system). I'd argue that the integrated approach is best for most, certainly the small to midsized companies who don't have the resources to maintain the often complex and brittle integrations between multiple systems.

Ron Smith
Title: Salesforce ERP Practice Manager
Company: Kyazma Business Consulting
(Salesforce ERP Practice Manager, Kyazma Business Consulting) |

There are a lot of great points made here. There is high demand for ERP and CRM to function as one so the line between CRM and ERP is getting more and more blurred.

It isn't simple to plug and play two different platforms together, so we end up helping companies figure out how to do that. I'm in a Salesforce.com implementation firm, so we see the CRM side expanding, most often by building Invoicing, A/R, light inventory, and project fulfillment functions directly on the Salesforce platform, or by using apps that are on the platform.

The other aspects of ERP we tend to integrate with, but there is a growing tide where more companies are moving to a single platform for their whole business information systems. The CRM switch tends to be an easier/faster decision than an ERP one in my experience, so companies tend to be more calculated in changing their ERP, leading many to make do with partial integrations.

Jeff Tchir
Title: Founder and Technical Advisor, RevRec.NE..
Company: RevRec.NET
LinkedIn Profile
(Founder and Technical Advisor, RevRec.NET, RevRec.NET) |

From my perspective, it doesn't matter - CRM vs ERP vs CPQ vs CLM vs whatever alphabets. A comprehensive set of requirements and business scenarios will drive effective selection of systems and tools. As mentioned above, major cycles of processes are blurred, plus acronyms are used pretty loosely, and some solutions are integrated and while others are not. I find once potential vendors have an understanding of the specific business needs, the discussion becomes much more valuable.

Kundan Lal
Title: Accounting & Finance Consultant
Company: Real Time Cloud Services, LLC
(Accounting & Finance Consultant, Real Time Cloud Services, LLC) |

Both are different but somewhat interrelated. A CRM application can manage any front-office activities such as organizing marketing efforts, managing the sales, customer service etc. On the other hand ERP application is mostly used to manage back-office activities such as SCM(Supply Chain Management), better project planning, distribution process management etc. An ERP solution can include CRM.

CRM systems are mostly used for storing and tracking your current and potential customers. ERP systems which could integrate a bunch of different systems helps to manage things like manufacturing, customer data, finance, SCM etc

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