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Are there providers who offer ERP system and CRM system from one source?
Topic ERP CRM software: Small and medium-sized companies (SME) usually face a special challenge when purchasing software:
A classic business usually has an ERP system. If a company’s activities in the areas of marketing, sales and service then increase sharply, the questions arise: Do you then need an additional CRM system for customer relationship management? Or is the CRM module of the ERP system sufficient? What requirements do users have for the CRM system? How good are the CRM functionalities in the integrated solution? Is there an appropriate module for all requirements?
The larger companies usually choose the „best-of-breed“ approach. This means that you choose the specialist providers for ERP system and CRM to build an IT landscape. A small company usually does not have the resources to do anything more than maintain the ERP system. The IT department, equipped with only a few people, is too small to master all user requirements in detail. Different providers or products must be trained and supported in detail. The management tries to avoid this expense.
Exkurs: What do the two abbreviations ERP system and CRM system stand for?
ERP stands for Enterprise Resource Planning.
In Wikipedia it says „Enterprise Resource Planning (ERP) refers to the entrepreneurial task of planning, controlling and managing resources such as capital, personnel, operating resources, material and information and communication technology in a timely manner and in line with the company’s needs. The aim is to ensure an efficient operational value-added process and a continuously optimised control of the entrepreneurial and operational processes“. (as of 26.05.2020)
CRM stands for Customer Relationship Management.
In Wikipedia it says „Customer-Relationship-Management, short CRM (english for customer relationship management or customer care), describes the consistent orientation of a company towards its customers and the systematic design of customer relationship processes.
The associated documentation and management of customer relationships is an important component and enables more in-depth relationship marketing. In many industries (e.g. telecommunications, mail order, service companies), relationships between companies and customers are long-term in nature. By means of CRM, these customer relationships are cultivated, which should have a significant impact on the company’s success“. (as of 26.05.2020)
Here are two videos (Video 1 and Video 2) that explain the benefits and functions of an ERP solution. (as of 26.05.2020)
The market leader in the field of business software SAP from Walldorf describes this on its own website as follows. (as of 26.05.2020)
The difference between ERP software and CRM software is as follows:
The ERP system has a very internal effect, the CRM solution has an external effect. And if both harmonize well with each other, then this is excellent for the company and its value creation. Because then one speaks of seamless or uninterrupted processes and procedures. The internal customer, i.e. the colleagues, feels this. And the prospective customer or external customer feels this when it comes to offers, negotiations, calculations or contract management.
For what does a company use an ERP software?
In traditional business, the – mostly manufacturing – companies use ERP software to handle the internal value-added processes. The usual core functionalities are
- material requirements planning
- production planning
- warehouse management
- Product information
- Financial controlling, accounting and bookkeeping
- and, depending on the provider and industry, also other modules and
- the connection (interfaces) to other systems
What are the advantages of an ERP software solution with CRM functions?
The ERP software connects a common database with the CRM software. This uniform database avoids unnecessary interfaces. The data exchange takes place smoothly. The ERP system is enhanced by CRM functions. The company can work and control holistically from Customer Relationship Management in combination with Enterprise Resource Planning. Employees can work together much more easily on this data and function basis. That makes the difference in the market. This creates a USP, the unique selling point of the company.
What does it need especially for CRM in terms of modules and functions?
Let’s start with the most important one: address and data quality:
These functionalities are often very weak in an ERP software. a) The mapping of different models of the branch or subsidiary companies as well as the group administration. b) The networking of a contact person with his different roles. e.g. Is the managing director also a lecturer or professor at the university and does he sit on a committee in the industry association? This networking often presents challenges for CRM software. c) A further check criterion is the topic of address or duplicate matching. How well and simply is this process supported?
Marketing-campaigns and marketing automation:
Is an email marketing software integrated? Is this third-party provider also efficient or does it only have an alibi function? Can the marketing department run different campaigns? Are the leads that are won to be evaluated with a score? From which score value on, does the sales employee receive this lead for final processing?
Mobile apps are currently enjoying a boom. Whether in sales or technical service, mobile CRM has been a topic for years. Start-ups in particular have specialized in mobile applications and manufacturers are happy to access their knowledge.
We have implemented ERP and CRM projects for many companies. For the topic CRM requirements we have listed which criteria should be used for evaluation or comparison.
Of course, there are many other additions to an enterprise software through customer management. Whether as add-ons or apps from the app world of the manufacturer. The diversity is growing all the time.
What other modules and functions do you need besides CRM system and ERP system?
For a larger solution, modules and functions such as Business Intelligence (BI), E-Commerce, E-Business or Online-Shop, Content Management Systems (CMS), Workflow-Management and process design are very often required. These are usually docked to the ERP software. Sales, marketing or e-commerce departments then use this information in their processes or for campaign management.
The business dispute: What is the leading system? ERP system or CRM solution ?
The mother of all questions on this subject: What is the leading system? The ERP system or the CRM system? Many say it is the ERP programs. What do you say? The question is usually answered with the compromise: The CRM system is the leading system for addresses and customers. The ERP leads in the area of inquiries and orders. In principle, this division is also correct. Only a modern ERP system works to a CRM system or the CRM supports the ERP system accordingly within the workflows. Example: A sensor in a machine measures the wear of a consumable. The ERP gets this measurement reported in real time. The CRM system then receives a message if the wear and tear leads to a reorder being triggered. An employee in the CRM tool receives the order on the screen and can release it.
If the sensor reports „machine failure“, the service technician can be informed immediately to analyse the failure and the machine can be repaired immediately. Thus, both software systems work together perfectly. The CRM software complements an ERP software with exactly those functionalities for which ERP software is not designed.
To control a company, both are needed. This is why collaboration is so important. A Collaboration of systems, but also of interdepartmental processes. The CRM data is needed in the modules of the ERP programs and vice versa. Preferably without cost-intensive and time-consuming interfaces.
The fairy tale of standard in enterprise resource planning system and the problem of individualization ?
The argument of software manufacturers is very often: Take our product, because we have already defined the standards in such a way that they, the buyer, hardly need to adapt anything. Depending on the business, however, this must be examined very carefully. Just because Company A comes from the same industry as yourself, it is far from certain that Company B has the same processes and value chains. So eyes open and information researched before a long-term, usually very expensive decision is made. ERP systems and also CRM systems are installed for at least 5 years, more likely up to 10 years. Today, as most systems are only offered from the cloud, the rent runs correspondingly long. A short-term exit from a just installed ERP solution is rare and usually expensive.
Therefore, the user should not look for a solution to the problem afterwards, but should evaluate and compare in detail beforehand.
Is there the best ERP system? And even combined with a CRM system ?
No, the answer to this question is clearly NO. The best solution as a general answer does not exist. Every company has its own particularities and special conditions. That’s what makes it hard to say which fits best. As described above. ERP vendors like to talk about standards. However, these are usually not available. Because every company tries to establish its business model, its range of products and services in such a way that a USP is created. And a USP is not created with a standard that is also offered by the industry colleagues. Differentiation is required. And this differentiation is either supported by the software or even only achieved through individual programming (customizing).
The usual suspects ERP software and CRM vendors ?
Who doesn’t know them, the usual suspects? SAP and Microsoft (Microsoft Dynamics NAV, Microsoft Dynamics AX or earlier Axapta and Navision) are both manufacturers of software solutions in this context. Both claim that they have the best solutions for ERP CRM software. Which in our opinion is not always true. There are companies that opt for the integrated solutions of one of the two suppliers. And they note, however, that integration looks different in theory and practice. Right now SAP the wind of the customers (as of May 2020) blows in the face.
What is the demand for ERP (Enterprise Resource Planning software) and Customer Relationship Management solutions?
The market for ERP software is a very stable market. He lives on replacement purchases. This means that the market has hardly any growth. The current growth is causing many companies to move from „on-premise“ to cloud solutions. This change or migration needs to be well considered. That’s why many companies are considering whether they should first move their ERP solution to the cloud. And only then do you dare to install the CRM solution.
Combined solutions are usually the better solution for SMEs.
The seamless cooperation of the systems is a competitive advantage for every company. So anyone faced with the investment decision to purchase an ERP system or a CRM system should check whether it is not worthwhile to choose manufacturers who offer both systems integrated.
As a company, this solution also has the charm that there is only one contractual partner and usually only one service provider. These are all arguments that speak for an integrated solution. Besides SAP and Microsoft Dynamics, there are also many other solution providers, which we have listed in our Landscape.
purchase or rent? On-premise or cloud? Or maybe Open Source?
These are several complex questions? Recently, hardly any licenses are offered for sale. The software providers are switching over to rental contracts more or less quickly, as the customers also allow. This is very rewarding for the provider, because he has a „recurrent revenue“, as the publishers know from their subscriptions. This has been common practice with CRM software for quite some time. The ERP market is slowly following suit. So on-premise-ERP is slowly out.
Entrepreneurs still prefer the on-premise solution and are afraid to put their CRM and ERP solution in the cloud. Reason: data protection and security. Just quite frankly: Most of the time, the security level of an external data center is significantly higher than that of your own data center. It’s more about the feeling of security. This can be solved quite well through contracts, audits and data protection officers.
Ergo: Cloud-ERP vendors are growing more and more.
The market for Software-as-a-Service is growing enormously according to a Blissfully study.
Whether open source solutions play an important role: The CRM application has been available as open source for years. In the CRM and ERP market, the topic of open source is a niche. In general, we say that open source is becoming more and more fashionable. However, it is only suitable for companies that have enough staff to deal with it, monitor developments and adapt the program for themselves.
Conclusion: Is a CRM tool with an ERP tool the solution?
Anyone who is currently undergoing „his“ digital transformation will sooner or later ask himself the questions:
What is the company’s vision? Which corporate strategy and IT strategy are derived from this? What does the IT target system look like? Will a new ERP system give us more momentum in the digital transformation? Do you need an integrated ERP solution? Do I replace the classic ERP system with Cloud ERP systems? What does this mean for the IT solutions in the company? With which IT systems can the company shape the future? What is the USP of your company? What are the advantages of a new system? How does one construct the integration of all wishes from the general conditions? What does a holistic solution look like? Of course, we consider the entire IT infrastructure and IT costs. In short: the Total Cost of Ownership (TCO).
For all those who are asking themselves these questions now or in the future,
we have developed the ERP/CRM vendor Landscape. We have compiled some relevant information in the table below. We collect the other important information and prepare it for you. A discussion with us creates clarity in the solution of the tasks in your company. We are interested in individual requirements with new technologies. So no off-the-shelf applications. We do not like standard. The tasks for sales, marketing and service are much too different for that. That’s your advantage.
We publish further information here or via social media.
difference to the classic ERP software:
However, as CRM consultants we differentiate ourselves in such a way that we do not delve into these topics, which are important for large companies, in this context. That would not be efficient. These are topics such as
ERP applications, ERP selection, ERP implementation, ERP functions, ERP manufacturers, ERP modules, ERP project, industry 4.0, the detailed resource planning,
These are project topics that are usually reserved for large companies.