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CRM vs ERP: What’s the difference and which do you need? (via CIO)

ERP, CRM, data, data science, data management, data scientist

Both CRM and ERP systems handle contacts, companies, quotes, orders and forecasts… and they may handle line-item configuration, bundles, delivery schedules and invoices. Where does one start and the other stop? Behold this guide for the bewildered.

Source: CIO

Review of Article

What are the differences between CRM and ERP?  Both have similarities and differences at the same time.  CRM’s purpose is sales and support type companies.  In other words, they work directly with the customer, but don’t directly deal with fulfilling orders.  ERP users on the other hand focus on the process and logistics of producing items to sell.  They don’t usually call customers unless it’s to reply to complaints.

In larger companies they use both types of IT systems.  ERP handles the distribution centers, supply chains, currencies and manufacturing plants.  CRM benefits support purposes, sales and marketing, both domestic and international.  Smaller companies don’t need the entire package, they only will use fragments of either CRM or ERP,  such as accounting packages and contact management systems.

What is ERP?

ERP deals with financial data, production and optimization.  This type of system manages transactions, accounts payable and receivable, taxes, cash flow management, and quarterly statements.  It also handles production schedules, procurement, inventory, fulfillment centers and supply chain management.  ERP lastly coordinates production across many manufacturing plants, wants to find ways to maximize profitability, and improve performances of supply chains to name a few things that it does.

What is CRM?

CRM deals with sales force automation.  CRM has to support these business processes:

  • Lead Qualification
  • Forecasting and Pipeline Management
  • Creating Quotes and Construct Orders
  • Account Management
  • Renewals / Repeat Orders


Personally if my company were big enough I would consider buying and using bits and pieces of both, not integrating the two systems together, but doing something like before mentioned.  It makes sense to me to just get the parts I need to run my business, as much as I can.  The question becomes, which one is what your company needs?  Do you focus more on the customer directly or strategies and logistics behind the scenes?  Or do you think you’ll need bits and pieces of both?


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