The layman may use the terms Customer Relationship Management (CRM) and Enterprise Relationship Management (ERP) interchangeably. And understandably so, considering how the two systems tend to overlap each other regarding services offered.

Both systems are responsible for handling contacts, quotes, facilitating orders and forecasts to mention a few. It doesn’t help that several vendors suggest that CRM is incorporated under the ERP systems.

But are they the same?

If you’re looking to purchase either of the two, then differentiating them is the first step. Only then can you pick the right software to meet your business needs.

Fortunately for you, the guessing and assumption game is over. We’re here to outline the main differences between these two software programs. We’ll also take it a step further by advising you on which system you may need. But of course, we can only recommend; the final decision is yours.

Different Users

There might be confusion on how the footprints of both systems are more or less the same, but there’s no uncertainty regarding who uses them. So, we’ll make this our first differentiating factor.

The main users of the CRM systems interact directly with customers. These are people involved in the sales and marketing function of organizations. They aren’t involved in the logistics and fulfilling of orders. Their job is to convince prospective customers to purchase the company’s products or services.

So, who then deals with the actual processing and logistics of fulfilling orders? The ERM system users. Personnel that fall under this bracket include:

• Factory managers
• Buyers
• Production schedulers
• Supply chain personnel
• Finance personnel

The above-mentioned staff don’t work in a customer facing environment. They seldom have to call a customer—unless of course they’re responding to a complaint regarding logistics.

A CRM system user won’t even know how to operate an ERP system—and vice versa. And yes, that’s how different the systems are. Usually IT staff are the only people who can probably access and use both systems for maintenance or upgrades.

Core Functions & Features

ERP

As alluded to earlier, one of the core functions of ERP software is financial management. The following categories fall under the finance category:

• Transaction journaling
• Accounts payable
• Accounts receivable
• Treasury
• Tax
• Quarterly statements
• Reporting and decision support

CRM

The core function of CRM is sales. Therefore, the only financial management systems you’re likely to find on the software include:

• Invoicing
• Revenue recognition
• Tracking sales figures and leads

Planning and Logistics

ERP

Anything you can think of that involves factory planning and productivity is incorporated under the ERP system. Here we’re looking at tasks which involve:

• Procurement
• Production schedules
• Inventory management
• Distribution and shipping
• Supply chain management

CRM

Since the main emphasis of CRM users is on the number of customers interested in the organization’s products or services, features on the system will include:

• Which product or service has been ordered?
• Who ordered the product?
• How many products are likely to be ordered in future?

Additional Services Offered by CRM

As the name suggests CRM personnel are interested in looking for new customers and building ongoing relationships. They’re always trying to devise new strategies on retaining these customers. This is why CRM software has the following features:

• Lead qualification
• Quote generation and order configuration
• Contract establishment and termination
• Ongoing account management
• Renewals and repeat orders

Which One Do You Need?

You have the basic information regarding what the two systems entail, so which one do you need? Quite frankly, you need both. You only need to figure out exactly how much of each software program you need to buy. And this will depend on the following factors.

Size of Organization

Are you a small or large company? If you’re a large organization, the decision has already been made for you. You need a full-fledged ERP system that can manage all aspects of the production and finance functions. You’ll also need a fully-fledged CRM system to handle all your sales and marketing functions.

Smaller companies can afford to pick and choose the features they want from both the ERP and CRM systems. Chances are small businesses rarely have all departments from production to sales up and running.

Case in point; there’s no need for a small accounting firm to go all out by investing in a fully -fledged ERP and CRM system. Such a firm can easily thrive on just an accounting package and contact management system. Additional features from both systems can always be added on with time as the business grows.

What Does Your Company Need?

Your business needs will also determine which features of CRM or ERP software are needed. Of course, there are certain functionalities that all businesses need regardless of size such as an accounting package.

Even if you’re a small business and don’t have an accounting function, you’re still going to outsource the service. Otherwise how else will you reconcile your accounts?

On the other hand, there are some functions that you can do without as a business depending on your area of speciality. If you don’t deal with inventory management, then a data warehousing feature on your ERP isn’t necessary.

Industry Regulations

As a business owner, you know that you don’t operate in a vacuum. There are laws and regulations you must adhere to if you expect to remain in business.

The General Data Protection Regulation (GDPR) requires you to respect customer privacy and keep your financial information in as few systems as possible.

The system you pick must have features that adhere to the above-mentioned regulations. Either that or you risk being on the wrong side of the law.

Final Words

Sure, both the CRM and ERP systems handle contacts, companies and orders as mentioned earlier, but the contexts are different. It’s clear that you need both systems—what you’ll need to determine are the exact features to incorporate.

Needless to say, your budget will also influence the system you pick.

Have we cleared the confusion for you regarding these two systems? If you have more questions, please leave a comment below.

So, you’ve heard the buzz words in the industry: Everyone’s using it, so you should too: ERPs.

In business, a popular trend usually has some value for the industry, instead of just being a gimmick. So, it’s worthwhile keeping an eye on what others do. That’s definitely the case with ERP (Enterprise Resource Planning). But that doesn’t mean you should be too quick in joining the crowd.

Warning: Making the wrong decisions during planning, vetting service providers or implementing could lead to more problems, rather than this great technology helping you enhance your business.

So, we’ll break it down for you: The most important facts any CFO should know about ERPs. Read this before embarking on this exciting, (usually advantageous) journey.

How Does This Relate to CFOs?

No, you can’t leave these important decisions in the hands of the IT department, the office manager or a committee. An ERP will affect business processes and therefore influence the company’s growth. That makes it relevant to a CFO’s responsibility in the company and you must work together with other role players to ensure a desirable outcome.

Here’s what you need to know.

The 6 Important Facts

1) You Must Understand the Process

Don’t leave it to others who are more technically minded. You can easily miss important aspects—which will affect costs—if you don’t educate yourself. For this reason, consider the most important software concepts relating to ERP implementation:

• Installation: What it takes to load software on hardware such as a server.
• Configuration: Making sure the software works according to your workflows and security requirements.
• Customization: Modifying software to suit your unique needs, often involving changing code.
• Conversion of data: Importing data into the system. If not in a compatible format, it must be done manually.
• Integration: How it communicates with other software platforms. (see more below)

2) You Must be Hosted on a True Cloud

Don’t be confused by unknown terms or technical jargon. The simple question to ask your service provider is whether the ERP is hosted on the cloud. This is the preferred method at the moment. It’s easier and more secure.

However it won’t help to simply be hosted on the cloud. Confirm that the solution has been rewritten for the cloud. This ensures it will keep up with future changes. As CFO you must ensure you invest in quality long term solutions.

3) Your Service Provider’s Vision & Longevity Determine Your Own Future

The next aspect that will affect whether this is a long term answer is the service provider’s own situation. You have the right to ask questions and research certain aspects of the vendors that offer you their services:

• Does the vendor’s financial situation make it a viable option for the long term? This isn’t simply about making sure you get good service. If the vendor hosts your data on their servers or on the cloud you need to make sure you’ll have access to that information for years to come. That won’t happen if a company suddenly goes bankrupt.
• The vendor you pick must be relevant to today’s market, but also stay relevant in future. We all know how fast the tech environment changes. It’s your prerogative to ask questions about how they plan to stay on par. Request information on their research and development plans to ensure they’ll keep on giving you a high end product for years to come.

4) Integration is Key

Your ERP isn’t the only system that will determine your company’s performance. You need all factors to work together well (integrate) if you want optimum results and frustration free days. This means you have to ask about integration with any aspects regarding:

• EPM: Enterprise performance management
• SCM: Supply chain management
• HCM: Human capital management
• CX: Customer experience

It’s vital that different platforms work together well, so you don’t have problems such as inconsistency of data between two systems.

Consider this before you pick a vendor and use the one giving the best support. You don’t want to face cumbersome processes where you and your team have to handle integration after the ERP is implemented. You also don’t want to deal with difficult processes of continuously keeping all the different platforms updated. They should function as one unit.

A specific risk—especially relevant to a CFO—is integrating ERP with EPM. You want your systems integrated, instead of doing a lot of work manually.

Luckily this is usually unnecessary in today’s market—you just have to pick the right vendor.

5) It Requires Teamwork

Your goal is to see the ERP deliver excellent results, helping various aspects of your business more effectively:

• Supply chain
• Manufacturing
• HR
• Payroll

That’s a lot of people that have to work together and you need to make sure all of them get on board and stay on board. A negative attitude towards the new system will prevent employees from using it effectively. This immediately affects productivity and your bottom line.

To ensure everyone’s buy in it’s important to:

• Identify needs in all departments and making sure the ERP will meet these requirements. This way everyone will experience an enhanced workflow and see the value of learning the new system.
• You won’t get departments’ buy in if their top leadership don’t believe the change is necessary. That’s why you need key role players and even your CIO (Chief Information Officer) to become part of planning & implementation.

6) Scalability = Success

The key to picking the right ERP is realizing that one size doesn’t fit all. You need an ERP that matches your unique requirements, not necessarily the one your greatest competitor implemented. And here’s why: Scalability.

If your ERP doesn’t cater for your size business, it won’t be effective. As CFO you’ll need financial planning tools that suit your business size, whether small, medium or large.

Apart from catering for your unique business needs, it must also be scalable to serve different employees well. As much as you need features to do financial planning, other role players in the business also takes part in these processes. The ERP must cater for their responsibilities too.

Conclusion

Yes, adding ERP to your business will take a considerable amount of time and effort. But, as a CFO, it’s essential you prioritize this process if you want to see positive long term results. Don’t worry. It will be worth it.

We are excited to announce the general availability (GA) of SAP Business One 9.3, both on MS SQL and SAP HANA databases.

The 5 most wanted features that drove customers to adopt the new 9.3 release were:

• Import from Excel
• Return merchandise authorization management (RMA)
• Streamlined CRM processes
• Approved procedures enhancements
• Project Management enhancements

What Can You Expect in SAP Business One 9.3?

1. With core expansion, release 9.3 supports new business processes and rounds out key areas such as:
   • Simple production routing
   • Return merchandise authorization management (RMA)
   • Project management updates
   • Simplifying and streamlining CRM processes
   • Authorization management
   • Price list enhancement

2. Leveraging our SAP HANA platform and building on the semantic layer, we offer new cockpit templates. With a new analytics portal, end users can schedule and consume reports without the need to log into SAP Business One.
3. With add-on solutions playing a key role in shaping our comprehensive business solution, we make it easier for partners to develop add-ons with the support of XML methods for user defined tables and the latest visual studio 2015 suite.
4. Deployment and management of SAP Business One is simplified with a centralized approach. Single Sign On (SSO) is utilized for apps for SAP Business One, version for SAP HANA making partner add-ons easier to manage and consume.
5. Optimal performance, higher stability and better supportability.

Check the SAP Business One 9.3 Highlights presentation for a solid overview of newly developed functional highlights.

Even though the ERP system has been proven to be an efficient method of managing one’s business, any system is only as good as the people who operate it. A shocking 75% of all ERP implementation is a failure due to lack of knowledge or training and budgetary constraints.

Benjamin Franklin said, “If you fail to plan, you are planning to fail.” These words ring true in the business environment in many aspects and this is no different.

No matter which industry you specialise in, “proper preparation prevents poor performance”. This saying is well known as the “5 P’s of success” originally created by the British army.  How does this link to the failure of implantation of an ERP project into a business? Research, information, training and a high standard of management are essential to the success of this system in a business.

There are obviously a dozen or more reasons why ERP implementation might fail, but below are a few valid points to take into consideration.

Poor Planning in the Initial Implementation Phase

Too many businesses rush into the process of incorporating this complex system into their existing business model. The truth is that Enterprise Resource Planning is a large and complex system. It takes time, dedicated training and adequate management to flourish as a proficient tool within your business. Time devotion to this phase is paramount.

How could something prosper in a business when nobody really knows how to operate it confidently? The relevant trained employee/s should know without any doubt that the results of the data collected is 100% accurate with utmost certainty.

Should this phase be tended too with enough diligence, ERP could prove to be an invaluable aid tool to your business.

Lack of Adaptability

In all areas of life, change is never easy, but necessary for growth. A lack of adaptability often prevents growth and tends to have an adverse effect on productivity. The same applies when it comes to introducing new systems into a business. The more adaptable your business model and staff are, the greater your chances of encouraging growth.

In an ever-changing and extremely competitive business world, flexibility is likely to be one of the key factors to being a step above the rest.

Ask yourself how trainable and adaptable your staff are. How dependant is your daily operation on your current business management system, should you have one? Can the business afford the time needed to dedicate to training? These are a few questions that need to be answered with a positive outcome prior to committing to an ERP project.

Poor Data Quality

Should the ERP system be integrated into an existing operation, the quality of the existing data would be paramount. ERP needs to be well equipped with data to enable it to process information like sales trends, customer data, staff efficiency and the general day to day operations of the existing business model.

Due to the nature of ERP, this data would need to be of a high quality to fit into ERP to ensure accuracy. The data collected by this system is of no worth if the input is not accurate. ERP thrives on the quality of the data used to make it efficient.

A consideration in this area would be to plan the transfer of the data from the current system being used, to the ERP system. Loss of data would cause a negative knock-on effect, resulting in the transfer from the current system to ERP obsolete until sufficient data could be accumulated. You might as well not waste any time on capturing data in any specific department if the data is not good quality, accurate and complete.

There is no use in starting to build a puzzle if you know that pieces are missing, and the full picture will never be experienced.

Lack of IT Support

In-house IT support is a huge advantage to the ERP system. Though this is not mandatory, implementation into a business without an in-house IT department has proven to be costly and time consuming. Even in a case where an IT department exists within the organization, enough and specialized ERP training would be necessary to ensure proficient expodition of any repairs or updates that may be necessary from time to time.

Another option would be to hire prequalified staff who have already undergone training and have experience in ERP operation. Using external IT vendors would strain the organization in costs and efficiency in terms of call out times. This would still make more sense than an untrained employee stumbling around a problem for hours on end with insufficient knowledge and experience to deal with the challenge at hand.

Lack of Data Sharing Ability

One of, if not THE most integral aspect to the successful implementation of ERP into an organization is the ability and capability to share data in the supply chain. Without this the system can be rendered as useless. Keeping up to date with the latest updates and putting them into practice would determine whether this system will make or break your company. Difficulties in the sharing of data could cost time and funds and end up being more of a liability than an asset to an organization.

Customization add-ons and the migration from an older system to ERP may pose as a challenge in this aspect and would need careful attention in the beginning phases of implementation.

Conclusion

75% is an alarming number of failures of the implementation of ERP. All factors above considered, it is paramount that all of them be investigated and thought through thoroughly prior to the implementation of ERP into a business.

Has the right software been chosen? Has there been enough training offered to the right employees to optimize productivity? Does your current data match up to the standard? Do you have informed and capable support available? Is your system correctly customized to the specific business? Does the business have the capacity to carry the cost of such a system? These are all important things to consider before implementing ERP in a business.

The efficiency of this system has been proven for decades, but if not managed correctly, could have a negative effect on an otherwise stable business. On a positive note, if the answer to the above questions are yes, Enterprise Resource Planning software could revolutionize your business.