The Difference Between CRM and ERP

ERP (Enterprise Resource Planning) is an application system that provides functions as business management that can facilitate business management in an integrated and well structured manner. Meanwhile, CRM (Customer Relationship Management) is a business strategy that combines processes, people and technology so that it can help sales prospects to get a higher level of sales and also maintain the loyalty of every customer in a company. Nowadays, both ERP and CRM are important things that almost every company in various regions must have. ERP and CRM have one common goal, namely to improve business performance, profits, automation and productivity of a company. Even though they have the same goal, ERP and CRM focus on different areas that each have their own benefits.

ERP and CRM systems use a different approach to increase profits within a company. ERP focuses on reducing overhead costs and cutting unnecessary costs. By making business processes run more efficiently, ERP can reduce the amount of capital expenditure on the process. Meanwhile, CRM serves to increase profits by generating more sales through better customer interactions. In addition, CRM can also be a more specialized solution. Many ERP solutions offer CRM functionality in them, and vice versa. However, of course the features related to customer interaction are not as complete as in CRM software.

The basic difference between ERP and CRM is that ERP has its main focus on financial data and finance departments within a company. While CRM, has its main focus on customer data that will be used by the sales and customer service department of a company. ERP improves the business performance of a company by helping the company to make a plan to be able to utilize resources optimally in all areas related to finance and administration. CRM also helps a company’s business to grow but through the relationship between the company and prospective customers and existing customers. CRM will manage and analyze every customer interaction and data throughout the customer life cycle which aims to improve the company’s business relationships with customers so that the company gets customer loyalty.

After seeing the differences and similarities between ERP and CRM which is more effective for improving the performance of a business in a company. Currently, almost every company that is developing, from small and medium enterprises to enterprises, will eventually need both systems, namely, ERP and CRM. If a company only needs CRM functionality and does not need to streamline business operations in other areas such as finance and logistics, then CRM software can be the right choice. However, on the other hand, if the company needs a solution for workflows other than CRM in the future, ERP can be taken into consideration because the two systems have a business process that is interrelated and often companies implement both systems, namely, ERP and CRM.