Are CRM and ERP the same?

By Kristine Hegglin
Updated: February 12, 2011

Defining an ERP System

An Enterprise Resource Planning (ERP) system is a complete software solution, which provides functionality for all facets of a business. An ERP system can be broken down into sub-systems, or related groupings of functionality, called modules. For example, some popular ERP modules are; Financials, Customer Relationship Management (CRM), Human Resources or Human Capital Management (HCM), Product Lifecycle Management (PLM), Manufacturing, Enterprise Performance Management (EPM), Project Management, and Warehouse Management, Supply Chain Management (SCM). All of these modules are integrated and share a common database. This integration enables all departments to coordinate, collaborate and share information.

A centralized database makes information more reliable, more accessible, and easier to share. An ERP system can only be considered an ERP system if it contains at least two modules. There is no limit to the number of modules an ERP system can have. In fact, some of the large ERP vendors offer solutions with twenty to thirty modules.

The Differences and Similarities Between a CRM System and an ERP System

CRM systems and ERP systems are not the same. A CRM system does not provide functionality for all facets of a business. For example, a CRM system does not have SCM functionality. However, like an ERP system, a CRM system is a company-wide solution. CRM solutions focus on managing customer relationships and interactions while ERP systems focus on managing entire enterprises.

A CRM system is considered, by some, to be a module within an ERP system. CRM systems provide salespeople, customer support personnel, and marketing departments the opportunity to up-sell and cross-sell products. An ERP system provides all employees with functionality to manage their departmental needs. Both ERP and CRM systems help businesses reduce costs, streamline processes, take advantage of real-time information, and enable businesses to become more profitable.

Some businesses only have ERP solutions, some only have CRM solutions, and some businesses have both. This means that these solutions can work independently of each other or they can be integrated. Many of the large ERP vendors offer a CRM solution. However, some vendors only offer one system; ERP or CRM. Both CRM and ERP systems vary, in terms of functionality, by vendor. ERP and CRM vendors typically offer CRM and ERP systems based on the size of a business. Less robust and less expensive CRM and ERP solutions are made for small businesses while robust and more expensive solutions are made to meet the needs of large businesses.

Featured Research
  • 2017 CRM Buyer's Guide

    Customer Relationship (CRM) software has become one of the most important business tools in today’s world. By allowing you to better connect with new and existing customers, CRM is an indispensable tool for sales teams and customer service teams alike. But with so many choices available, it can be difficult to decide on a solution. more

  • The New 2016 CRM Comparison Guide

    Our new 2016 Q4 CRM Comparison Guide includes all the information you need to make the best purchase for your business. With relevant information on over 40 CRM vendors, you can learn what solution offers the features and pricing you need. more

  • CRM Software Cost Guide

    Did you know that you don’t have to spend a fortune to implement a CRM solution? In today’s marketplace, there are a variety of CRM options to choose from. And whether you’re a small business or a large enterprise, there are always ways to save. more

  • CRM Basics for e-Commerce Start-ups

    Customer Relationship Management (CRM) software is an invaluable tool for any e-commerce start-up. Your existing customers are the most valuable asset you have. With a CRM, you can better engage with them so that one-time customers become repeat customers and even evangelists for your brand. more

  • The Customer Connection

    To stay competitive, your small business needs to take advantage of CRM and social media. CRM software is a useful tool that can help you develop a social media presence and connect better with the customers you already have. more