What is the CRM? What is the ERP? A Comparison of These Applications

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* In this video, when writing on the board, I mis-wrote the ERP at the bottom to ERM.

Welcome to the vlog of conversion.vn

Today’s topic is about the CRM and the ERP. What is the definition of the CRM and the ERP? What is the goal of these two applications? Why do we have to use them? If a business enterprise wants to use these two applications to improve the performance of their business, what application settings should they try first, or later?

This vlog will give you some basic knowledge about this issue.

The CRM – Customer Relationship Management Application

The goal of the CRM: Storing, measuring and recording brand interactions with your customers. Any type of interaction with the customer is recorded, for example: When you have a customer, it will record if your salesman have contacted this customer, and how he did it, whether the customer get called, any appointment was set up, how many emails were sent, how many times have you met, what is the content of the appointment, how to interact with other customers. Everything similar is recorded on the CRM data system

The CRM usually involves:

– Customer Service

– Sale Support

– Social Monitoring (Measure how customers interact with your brand, record how customers comment, like, share and interact with the content and information about your products and services.

– Community Management (Record if you and the community have a forum, how all the people in the community mention your brand, how they interact)

– Call Center (Record any incoming calls, short calls, what is the content of the call)

In a nutshell, all of the things involved in customer and brand interactions are all recorded by the CRM. Therefore, the purpose of the CRM is about the customer, and also support the sales and marketing teams on telling: what interaction did you have with the customer and what more can you do to sell better, to persuade them to buy more as well as help increase the level of customer loyalty.

In short, the CRM’s primary goal is to increase sales revenue and increase customer loyalty with its brand.

ERP – Enterprise Resource Planning – An application which helps to plan and organize your company’s resources more efficiently

The goal of the EPR: Optimize and improve the internal processes in the company to help make the company function better and less expensively, and thereby increase profits.

For example, if a company has a number of staff of about 5-10 or so, it is simple and easy to manage (from accountant, human resources, etc.). However, when it has a number of 50, 70 or 100 staff, everything from finances, payroll transfers, hiring and other processes become more complicated. In this case, the ERP will be the tool to help you improve the processes.

The ERP includes all support for the following parts:

– Accounting / Finance: Support the calculation of salary, cash flow of the company, accounting process is automated, clear and fast.

– Human Resource: How to recruit, how to store information, how to calculate to support personnel operations

– Manufacturing

– Supply Chain

– Project Management: Manage all projects running in the company

The ERP focuses on internal processes and one important goal of the ERP is to increase the efficiency of those processes.

For example, before your company has 20 people, there are two accountants dealing with accounting matters. If your company’s level rises bigger than 50-70 people, you need more accountants to handle more cash flow and calculate employee salaries. But if the company grows to 100-300 people, you can not continue to add accountants and dilate the accounting department, similar to other departments such as HR, production, purchasing. can grow to the size of the company. At this point, the ERP will jump in to improve the efficiency of these processes and cut operating costs, without needing to increase the number of employees, especially with clear, adequate and supportive processes.

The CRM and the ERP – duplications

Sometimes you buy some ERP applications that will include the CRM in the package. Because some ERP works, such as Sale, are also related to sales. At this point in the ERP, there will be modules of the CRM to manage sales. However, the ERPs that have the CRM attached sometimes will not have enough optimizations, not enough customization to serve the specialized tasks of the CRM. Besides supporting the sales, the CRM also supports marketing in aspects such as:

– Marketing Automation: automate the sending of emails by after the customer leave their information, they will receive automated emails and weekly newsletter, receive messages about the appointment with the brand, the SMSs reminding of the programs and events.

– Sale Automation: support for sales department more conveniently using SMS, email.

The ERP may in essence includes the CRM in it, but at the present, separated the CRM software is still more effective in my opinion than the ERP with the CRM available in it. If you need to do it, here’s the advice: building an ERP is just about solving problems internally, the CRM focuses on solving problems with external customers. However, the ERP and the CRM also lead to somewhat intersecting parts, which are related to customer data, so we can integrate the ERP and the CRM together as they are interoperable.

When to use the CRM and when to use the ERP?

A company has many different stages: Survival> Growth> Mature

Often during the Survival and Growth phase, companies are interested in and need to increase sales, earn more customers, and sell more products. At this point you should use the CRM initially. The CRM will assist you in the Sales and Marketing process, making it easier for you to sell your products, take care of your customers more effectively, and increase your revenue and helping your company survive and grow.

As the primary goal of the ERP is to improve the efficiency of the processes and cut costs, you should make a lot of money first and then think about cutting back on operating costs of the company, so your company should use the ERP when it is in the midst of the second half of Growth and heading to the Mature phase. As the number of company employees increases, the processes in the company starting to have too many problems and unresolved issues, the manual processes between the departments become more complex and affect the ability to operate the company. At this point, the ERP is the solution you need to integrate for your company. Or if the service of your company has too many processes (such as law enforcement, legal advice, migration, settlement, finance etc.), the ERP can also be applied early. In short, the ERP can be brought into the company at the time when surviving is not the problem but what matters are cost cutting and increasing profits.

After owning the CRM, you should consider adding the ERP, then integrate the two applications together to exchange data back and forth. That means CRM customer data can be synchronized with the ERP and the information is saved for shipment, production, delivery or finalizing the order, etc. Or when the customer data of the ERP is synchronized with the CRM, sales and marketing can help customers solve any incurred problem better. It’s the addition efficient when integrating two ERP and CRM applications.

Conclusion

In short, the CRM focuses on increasing sales, while the ERP focuses on cutting the cost of the service. What both of these applications have in common is increasing efficiency and profitability, albeit in two different directions. Currently, there are many different services and CRM, ERP providers. However, depending on the industry and the process you need and the nature of the company, you should choose an appropriate service provider.

If you have any questions about this issue you can email me or comments on this vlog. Thank you!