What’s The Difference? – Forbes Advisor

An ERP system offers companies capabilities that improve efficiency and productivity. It does so by integrating the digital systems throughout the company to create a central database. Data can then flow through them all, creating one source of truth and greater visibility of company performance for cross-functional decision-makers and practitioners, including sales, customer service, HR, manufacturing, resource procurement and finance, among others.

When this one source of truth is combined with advanced ERP system technologies such as artificial intelligence, machine learning and automations, companies can efficiently allocate resources—such as inventory, funding or talent—to boost performance. For example, ERP systems analyze data and predict outcomes in various market conditions so companies know where resource gaps may occur and can act to meet demand before they are problematic.

Key features:

An ERP offers companies cross-functional integrations, a central database, analytics and reporting, metric tracking, data analysis and automations. Here is a closer look at each of these features and how they are employed.

• Integrations. An ERP system integrates cross-functional systems such as those used by finance, sales, marketing, customer service, human resources, supply chain management and manufacturing. This integration creates cross-functional data visibility to make process management and strategic decision-making easier.
• Central database. By integrating cross-functional systems, the ERP system creates a central database for all company data.
• Analytics and reporting. Via a central database, the ERP system can put the data to use to offer insights into company performance, resource allocation, efficiencies and inefficiencies.
• Metric tracking. Companies can use their ERP system to track key performance indicators (KPIs). Doing so helps them determine if they are or are not meeting their goals.
• Data analysis and predictive reporting. In addition to real-time visibility into company performance, an ERP system can analyze internal and market data, then glean and surface insights into likely company outcomes. In doing so, it equips companies to act quickly for best outcomes.
• Automation. Automations within ERP systems allow companies to instantly complete redundant tasks without human intervention. Example automated tasks may include payroll processing, invoicing, order processing, marketing campaign execution, new hire onboarding, demand tracking, work order management, report generation and data entry.

Who it’s best for:

An ERP system is best for companies that have experienced decreased performance and financial loss due to internal cross-functional inefficiencies and are looking for a solution to these problems.

A CRM is a business software that generates a complete picture of customers’ and prospects’ interactions with your company and combines this data with interaction data from other platforms, such as social media platforms. It may also offer insights into customer or prospect interactions with competitors. In doing so, it creates a complete view of customers’ preferences, their place in the sales cycle and their purchase and communication history.

In turn, the CRM offers features to help companies build and manage positive customer relationships. It informs company personnel about what messages, timing and communication channels are best for lead or customer outreach or support. In addition, by tracking interactions, sales representatives learn customer preferences and needs, allowing them to offer real-time personalization when reaching out to offer new products or product upgrades.

Key features:

A CRM offers companies key tools and capabilities for nurturing leads and building positive customer relationships. Such features include complete customer profiles, competitive analysis tools, integrations, automations, reporting and lead scoring. Here is a closer look at each of these key features, including what they are and how they are employed by CRM users.

• Customer profiles. A CRM creates a consolidated and 360-degree view of each customer, prospect or lead. It does so by collecting personal data such as customers’ contact information, social media data, websites and preferences. It then tracks customer and lead interactions and purchase histories, including with the company and its representatives.
• Competitor analysis. A CRM can aggregate information on competitors, such as recent news articles and customer interactions with them. In doing so, it offers insights into how the company must compete for leads or customers.
• Integrations. A CRM can make customer support, outreach and lead-nurturing easier through integrations. For example, integrations with survey tools can help sales representatives gain feedback to inform positive future interactions. Likewise, integrations with document signing tools can help sales representatives close sales faster, easier and with higher customer satisfaction.
• Automation. A CRM’s automations help companies nurture positive relationships. For example, sales representatives may receive reminders to reach out to hot leads or the system may detect it’s time to launch the next step in a lead-nurturing email drip campaign. Other common automations include lead or service case routing, report generation and data entry.
• Reporting. With a complete view of all customer and competitor data, a CRM can offer predictive reporting on how customers are likely to feel about new products or company decisions. This allows company sales and service representatives to proactively prepare the right messaging and outreach to nurture positive relationships.
• Lead scoring. Many CRM systems assign a value to each lead to help sales representatives determine how likely they are to buy. This helps sales representatives prioritize their interactions to know when best to reach out and, ultimately, close more sales.

Who it’s best for:

CRMs are best for companies needing to increase lead acquisition, close more sales and boost customer satisfaction, retention and lifetime values.