THE RELATIONSHIP BETWEEN YOUR CRM SOFTWARE AND YOUR ERP SYSTEM

Customer Relationship Management (CRM) software is customer-centric, and allows you to communicate effectively and consistently with your customers and prospects.  An ERP (Enterprise Resource Planning) system allows you to handle your financial affairs, your inventory and billings, and even to manage and track your manufacturing processes.  So, should these systems be connected, and what should the flow of information look like between them?

In any successful enterprise, these two systems should be directly connected to each other and customer-centric activity should flow freely between them.  Some experts have said that CRM manages the front-end of a business, and that ERP manages the back-end.  I don’t totally agree with that.  Robust CRM and ERP systems can and should operate in both sides of the company, and they should be “partners” in any successful company’s information processing paradigm.

The important thing is that both of those systems should be connected in real time.  That is, any activity conducted in the ERP system should immediately update the CRM system.  And vice-versa.  The alternative is to perform a discrete synchronization process sometime during the day, usually during off-hours.  This causes your salespeople and/or your administrative department to not have the most current information when important decisions must be made.  This type of real-time connection is usually not found in disparate ERP and CRM systems.  In other words, if your ERP system is Sage 300 ERP and your CRM system is SugarCRM, you cannot expect the same level of integration between them, as compared to an ERP/CRM combination which are both written by Sage, or both written by NetSuite, or both written by Microsoft.

Can both systems use the same customer database? Well, some tightly integrated ERP and CRM systems do just that, but it has its pros and cons.  On the plus side, if both systems use the same database, then any talk of a synchronization process, or an integration, is moot.  None is necessary if they both use the same records.

On the minus side, if both systems use the same database, then you have given your sales staff access to the file containing your customer records, and you have dramatically increased the number of records in your “customer” database, because it now contains all your sales staff’s prospects.  Systems that use the same customer database have sophisticated security schemes that are roles-based, and which prevent access to financial information, by those who are not authorized.  Nevertheless, it poses a security challenge.

Without customers, and more specifically, without happy customers, no business can survive for long.  CRM’s job is to make the contact that you have with your customers and prospects more consistent, and of a higher quality.  Your ERP system’s job is to track your customers’ purchase activity, which helps you to better meet their buying needs.  Working in unison, they let you know when it’s time to contact a customer, and what the most compelling story is to tell them.

About the Author
Doug Deane is President of DSD Business Systems, an international provider of on-demand (cloud) and on-premises ERP and CRM software, specializing in wholesale distribution, manufacturing, warehouse management, inventory, business intelligence and eCommerce software.  DSD offers Sage 100 (formerly MAS 90), Sage 300 (formerly Accpac), Sage 500 (formerly MAS 500), NetSuite, Sage FAS, Sage HRMS (formerly Abra), Sage CRM, Sage SalesLogix, Extended Solutions, and Custom Programming.

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