As a manufacturer, you are aware there are many software solutions available to help run your business. There are two types of applications in particular that, together, cover almost the entire business scope:
- Customer Relationship Management (CRM) – A CRM system deals with front-end information, managing customer and prospect data generated through interactions with marketing and customer support. Companies use a CRM to manage relationships and their sales pipeline while upselling and cross-selling products.
- Enterprise Resource Planning (ERP) – An ERP system focuses on backend information, managing customer information that is gathered once orders have been placed. A manufacturer can use an ERP to manage information like order and invoice history, accounting information, financial data, and supply chain/scheduling.
CRM software can be standalone or one of a number of modules within some ERP software systems. In both scenarios, to increase the efficiency and productivity of your business, it is prudent to integrate the two systems. That being the case, the question then becomes:
Is it more advantageous to deploy and integrate two standalone systems or implement one vertically integrated ERP system?
Let’s take a look…
Why A Single Vendor Solution?
Depending on the frequency and the type of data pushed and pulled between the systems, integrating the ERP and CRM applications from two different vendors could potentially be costly, complex, and risky. Future software updates from either the ERP or CRM vendors (or both) may also lead to loss of interoperability. To avoid these potential pitfalls, you might opt for a single vendor solution with pre-integrated ERP and CRM capabilities. Other benefits to this approach include the simplified and more timely data sharing, , improved order and quote management, reduced IT support costs, reduced training costs and more–all stemming from the synergies of the two systems.
Why a Two Vendor Standalone CRM Solution?
On the other hand, the CRM components of many ERP systems are not as full-featured as best-of-breed or standalone CRM platforms. With less comprehensive CRM functionality, you could risk falling behind competitors whose CRM systems provide better customer service capabilities.
Standalone enterprise CRM systems tend to have advanced features such as:
- tracking and predicting their customers’ purchasing behavior;
- better identifying business opportunities and new sales leads;
- enhanced marketing automation (e.g., email, online and social media advertising campaigns);
- better support capabilities for current customers;
- enhanced market segmentation and analysis; and
- state-of-the-art dashboards, KPIs and reports.
Simply put, ERP systems are more concerned about the backend factory stuff, treating the CRM module as just another “add-on.” A standalone enterprise CRM is instead hyper-focused on customer-facing stuff.
So, which will it be?
To decide between these two approaches to CRM and ERP integrations, you essentially need to ask yourself these questions:
- How much CRM functionality will I need to keep up in the marketplace?
- What level of integration do I need between the two?
- What type of data needs to be pushed/pulled between the CRM and ERP?
Given today’s advanced API technology, the integration piece has become less complicated, less costly and easier to perform, making the case for the Two Vendor Standalone CRM Solution approach.
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