How ERP and CRM Differ: 5 Key Differences

What Are ERP and CRM?

Let’s start with a quick clarification of terms. Both acronyms refer to information systems:

• ERP (Enterprise Resource Planning) is a central enterprise system for managing company processes. It covers areas such as finance, accounting, manufacturing, logistics and distribution, or HR.
• CRM (Customer Relationship Management) is a system for managing Business and Client relationships, where all information about Clients and Deals is stored in one place.
  
  

ERP manages virtually all processes in the company, while the CRM system focuses on Business and customers. They complement each other, making company operations and the entire Business more efficient.

Differences Between ERP and CRM

When deciding which system you need and will benefit from, it helps to understand the differences. Let’s take a look:

1) System Size

ERP is a comprehensive enterprise software that automates processes and helps manage the company. It combines various systems into one—you can manage company accounting, finance, HR records, payroll, as well as warehouse and logistics operations.

ERP can also include a CRM module focused on sales and Client relationships. It stores information about customers, Deals, and the history of interactions.

A standalone CRM system is a much simpler tool that won’t overwhelm you with features. It’s ideal even for small and medium-sized companies for whom ERP is too complex, but who’ve outgrown tracking Clients and orders in Excel.

2) System Focus

ERP focuses inward on the company, while CRM is outward-facing, toward customers.

With ERP, you manage and automate company-wide processes. It connects departments that share data and communicate with each other, streamlining operations and boosting productivity. ERP helps improve internal processes and reduce operational costs.

CRM, on the other hand, facilitates information sharing across teams—especially sales, marketing, and customer support—because it stores all data about Clients and Deals. Unlike ERP, CRM doesn’t influence internal workflows but simplifies the building and maintaining of Client relationships. This boosts sales, performance, and profits.

For example, having a record of communication history means everyone knows what’s been discussed with a Client. The Client feels cared for, which increases satisfaction and loyalty. Stronger business relationships lead to better Deals and higher revenue.

3) Data Used by ERP and CRM

Each system handles different data. ERP, being a robust system, works with complex and varied company data—from accounting to production schedules, product information, and employee records.

CRM stores only information related to Clients and Deals, along with data from marketing campaigns and communication history. Compared to ERP, it’s just a small portion of the overall data.

4) Who Uses ERP and CRM

ERP is essential for the smooth operation of the entire company, and is used by everyone—from managers and accountants to HR, warehouse staff, production, and sales.

CRM is mainly used by sales teams and customer support and also helps marketing departments. It supports people in contact with customers, helping manage relationships. Management can view sales results and forecasts in the system.

5) Who Needs ERP and CRM

CRM is beneficial even for small businesses with a few dozen Clients, while ERP is more suitable for companies with dozens of employees and multiple departments.

CRM is valuable in both B2B and B2C environments—anywhere you need to understand your customers, improve relationships, and offer top-tier service. That’s why CRM is essential for companies with sales teams, and it's also used by financial advisors, real estate agencies, and service providers.

ERP is indispensable for larger manufacturing, distribution, and logistics companies—and for any growing business that needs to streamline operations and reduce the need to hire more employees for routine admin tasks.

When to Choose ERP and When CRM Is Enough

It always depends on what you need. If you want to understand your customers better, improve relationships, or gain greater insight into your Business, a CRM system will help. If you need to automate company processes and eliminate administrative tasks, consider using ERP.

ERP is also helpful when you're using many different tools and losing track of them. You can integrate other software into the ERP system—including your existing CRM system, if you already have one.

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