In 2016, the global ERP software market reached $82.3 billion. According to Statista, revenue from CRM market was valued at $39.5 billion last year. If exploring the statistics about the cloud software SCM, this year it is worth $4058 million.
While CRM software helps to increase revenue, top ERP systems decrease entire operating costs. Together, these software systems may help the company grow through better productivity and sales.
Integration of ERP, SCM and CRM Applications
There are two key challenges that force business owners to check how they run their businesses in the fast-paced and global outsourcing environment. The first one is outdated IT systems that can’t cope with complex global relationships. Systems were made for the old paradigm without the ability to get updated information. The second challenge is that IT solutions fail to deal with customer relationship management.
Usually, companies buy enterprise resource planning and customer relationship management software separately. CRM handles front-end information involving sales tracking, recording customer interactions, prospecting, pipeline management, and developing/assessing marketing campaigns. Enterprise resource planning deals with key backend operations such as purchase history, accounting information, billing and shipping details, supply chain management details and financial data.
However, if your CRM and ERP systems have separate databases, businesses need to worry about holding them synchronized. All changes have to be integrated into each system.
Moreover, it is a manual process with a need to wait to see updates that means slower processes and a risk of mistakes. On the other side, separate systems help to manage them easier but integrating ERP and CRM them into one software will speed up business processes and improve productivity.
Statistics shows that ERP systems enhance order-to-shipment times by 23% while ensuring an inventory of more than 95%. They help to improve client satisfaction and the results may be increased with a unified system.
Implementation of CRM functionality to the ERP solution will help both systems save all the changes in one database and make them visible instantly. It helps to automate and streamline interaction with the customers. Moreover, it delivers needed transparency and visibility into all stages of the business.
Experts say that mutual implementation of CRM and ERP helps to deliver a 360-degree view of the clients. It helps to cover various issues from accounting to finance. Such integration helps to see what areas of business need to be improved, and consistent data brings you greater reporting and analytics. Managers may faster notice changes, know customers preferences and level of loyalty.
With successful integration, employees from different departments may cooperate better as well. Managers have quicker access to the key company’s information and track business processes. Without it, team members can become less productive.
Both CRM and ERP systems save valuable account and contact information. They complement each other: ERP deals with warehouse, billing address and shipping while CRM pays attention to sales and customer support goals.
The ERP and CRM implementation eliminates the need to duplicate information. Moreover, it brings greater structure, quote management, and inventory.
With CRM and ERP implementation, companies may turn proposal generation into the orders by applying one system. It allows providing data management faster and refining company efficiency. Besides, the sales managers receive better visibility and easier access to update information.
Single platform for CRM and ERP helps to decrease IT costs and expenses related to the training. Statistics showed that companies spend approximately $1,208 per year on each employee. So, reducing the costs is very attractive for the businesses.
Related article: How to Find the Best Language for ERP Development
ERP and SCM systems have needed functionalities to improve business operations.
These considerations simplify further integration of CRM and ERP systems:
- Technology issues: when the SCM and ERP systems are on alike technology platforms, implementation is simpler. Moreover, it reduces the time to ROI.
- Business priorities: if you think about whether it’s better to implement the first, supply chain or ERP, take into account that ERP starts with business workflow and financials, and usually companies begin from here.
- Value of implementation: businesses need to consider and assess the value of both systems.
- The entire cost of ownership: the main goals are cutting the costs and greater user experience. So, after the implementation, check whether the purposes are achieved.
These are key benefits of ERP in supply chain management:
- Better efficiencies, lower expenses, and greater productivity.
- Improved customer retention through greater services.
- A new way to handle resources through the automated workflow.
- Quick completion of tasks and growth in production.
- An opportunity to stand out among competitors with the ability to adapt to the changes.
CRM vs ERP vs SCM
If you need to describe SCM CRM and ERP and the differences among them, keep in mind that it’s quite challenging. Let’s start by comparing ERP and CRM. Both these systems deal with contacts, orders and companies. Let’s consider their differences.
- The main difference is users of these systems: sales and customer support managers use CRM, ERP users pay attention to logistics and the processes. They are internal and supplier-facing.
- CRM is aimed to track interaction with the customers while ERP has to deal with software to handle business processes.
- Customer relationship management is a front-office system that needs to standardize cooperation with the clients and simplify them, handle sales pipeline, and develop dashboards and meaningful reports. Besides, it can track resources such as time and efforts, speed up sales processes, automate customer service, identify the bestselling services and products, manage inventory, supervise business contacts, share customer profiles with other team members, etc.
ERP systems strengthen the data delivered by different departments and handle and automate back-office business assignments and activities involving accounting and finances, purchase, HR and payroll, manufacturing, supply chain management, distribution process management, services knowledge base, project management. Also, ERP systems may decrease extra tasks, reduce expenses, standardize key business processes and speed up them.
- CRM pays attention to increasing sales, but ERP is focused on decreasing costs.
The entire supply chain network has to involve both ERP and CRM management systems.
These are the objectives of enterprise resource planning:
- Access to needed data.
- Refine service experience.
- Improve competitiveness.
- Modernize business systems and processes.
- Automate key solutions.
- Improvement of operating efficiency.
- Return on investment.
- Reducing inventory cost.
CRM and ERP integration allow the company becoming more automated. There is a better sync among various departments. So, the data flows across the enterprise and there is no anxiety and misunderstanding in communication issues.
Each team member performs needed tasks and upgrades the system without disturbing others. Managers of all levels receive a bird’s eye view of all operations and data points.
ERP software allows implementing data and real-time updates and information. It brings greater management and planning of resources. Moreover, ERP systems deliver greater efficiency, workflow, and upgrading software modules.
Nowadays, it is used by the multinational companies for reaching their long-term goals. Successful integration of ERP helps businesses to get more profit by applying needed resources. It is a wonderful tool for cost-effective results.
Greater management of resources helps to stand out among competitors. Integration of ERP manages various functions and refines company efficiency. New technologies mixed with ERP software allows controlling better and manage data. That’s why it is important to align implementation with the company’s goals. Before creating and planning the project, you need to develop and design the project in a realistic approach.
Greater order tracking, understanding clients’ needs and business demands by ERP facilitate appropriate utilization and governance of resources. It improves the processes and increases the ROI.
When businesses smooth out analytics, business operations, and technology, they can speed up their supply chain, match standards and vendor compliance purposes. Implementing ERP brings a 360-degree view of needs and expectations and produces through various distribution channels to meet industry standards and create better customer satisfaction.
Global companies require a demand-focused approach to ensure that they deliver the right items at the right time at the right volume. ERP may recognize when products are in high demand, identifying when there’s a demand for a shift and changes in the company’s strategy. It helps to set goals, gain useful insights and reduce discounting while improving sales.
At Diceus, we know the value of ERP systems and want to share with you 2 bright examples of them. The first one - FSA that helps companies all over the world to deal with employees’ benefits by using flexible tool for these goals. This innovative and long-term solution allows decreasing administrative expenses, automate and optimize HR processes while strengthening employees to view and manage all the benefits they have.
Our interactive and easy-to-use platform offers all needed tools for the successful benefits management. The employer and the staff may easily and securely reach the information and control the workflows. The customer said that the product helped them to provide their work 86% more effective than earlier.
The second example is Benefitnet that simplifies the work of insurance specialists and HR professionals. The main advantages are automation of the business processes, simplification of the complex claims and census management, improve the relationships among brokers, customers, and insurance providers.
The idea to launch this strong ERP system was driven by the challenge of our customers to reach directly insurance companies for the too expensive cost. Our unique solution connects the customers with insurance brokers for reasonable prices with many useful features to do more with less.
Now, it’s time to switch to the comparison of CRM and SCM. They’re similar because they are both technology-driven but they are different in terms of their effects and uses in the business.
Customer relationship management allows saving all data about the customers in one place. This program is customer-centric and focused on building meaningful relationships with the clients. Even human resources and financial issues related to customer goals may be handled by the CRM systems.
The advantage of CRM is improved customer experience through permanent research and greater systems. Applying data captured from the customers helps to target needed customers with appropriate marketing to engage the audience and decrease the number of unwanted messages.
CRM can gather valuable data to identify key customers’ needs and know what clients want. The CRM implementation in the supply chain helps to forecast the customer behavior and improve customer satisfaction.
SCM is aimed to help employees of the supply chain at all levels. These are key goals:
- decrease inventory cost,
- improve sales,
- refine the coordination and the cooperation between members of the supply chain.
SCM system requires product planning, forecasting, inventory control, manufacturing, product distribution, etc. Supply chain management is a cooperative process where supply chain partners collaborate with product resellers to deliver good results. Software-based solutions help them to sync all the processes.
SCM is basically the flow of services and goods. It involves the entire process of in-process inventory, goods’ movement, and storage of raw materials. The additional purpose of successful supply chain management is to decrease the inventory expenses for the company.
So, when companies implement together ERP and CRM, they don’t need to worry about synchronization of various databases. It eliminates manual processes and helps to speed up the workflow, brings better customer satisfaction. Moreover, CRM and ERP integration increases ROI and decreases inventory costs. Both CRM and ERP systems keep needed account and contact information. They successfully supplement each other: ERP copes with warehouse, shipping, and billing address while CRM focuses on sales and customer support purposes.
Besides, ERP in supply chain management delivers such benefits: better productivity and lower expenses; greater customer retention; the automated workflow; fast completion of tasks; competitiveness.
If you want to gain such advantages for your business, contact us and our professionals will help you get the needed solution.