Integrate CRM and ERP for Better Intelligence

Technology is an accelerant. It will add fuel to whatever fire you have burning in your organization. If a company is already efficient, technology will make it even more so. Conversely, if an organization is inefficient, technology will magnify the inefficiencies. Progressive companies get this, which is why more of them are maximizing efficiencies by integrating enterprise databases such as CRM and enterprise resource planning (ERP) systems.

CRM systems deal with front-office information about customer interactions with sales, marketing, and support. ERP systems handle critical back-office data, managing customer information once the order has been placed. This can include purchase history, billing and shipping details, and accounting information. Both systems independently offer substantial benefits to businesses. Connecting the two provides even more advantages.

But, generally, ERP and CRM systems tend to remain separate, as their contrasting architectures make them difficult to integrate. Rather than invest time and manpower in bringing the systems together, most companies employ "swivel chair" data entry, where employees manually retrieve data from one system and enter it into the other. Such a procedure is error-prone and time-consuming.

Solmax International, a Canadian manufacturer of geomembranes, took another, less common approach. When it started to roll out Aptean's Pivotal CRM system about five years ago, it integrated the system with its existing Ross ERP software, also from Aptean.

As a result, Solmax became more nimble, whether in shipping orders, paying its salespeople, or responding to customer inquiries, according to Philippe Palmarini, IT director at Solmax. "It's making everyone more efficient and independent," he says. "They do not have to wait around for information from another department about a particular account or customer."

Because of the integration, data flows freely back and forth between systems. This "will only make you stronger as a company," Palmarini says.

The integration took about six months to complete and was a lot less expensive than executives at Solmax had expected. "There was a cost, but it was worth it," Palmarini says. "It paid for itself in about a year."

Despite the tremendous value that integrated systems provide, Solmax is one of only a select group of companies that has successfully linked its CRM and ERP systems. This is expected to change, though, with many industry experts indicating that the merger of CRM and ERP systems is both imminent and inevitable.

"We're in the hype cycle, with a lot of companies talking about doing this," says Natalie Petouhoff, a vice president and principal analyst at Constellation Research.

Kevin Roberts, director of platform technology at FinancialForce, a provider of ERP systems built on the Salesforce1 platform, agrees. "We've reached the tipping point now," he says. "The conversations have definitely started."

They've also started at Progress Software, where Jeff Reser, head of solutions marketing for Progress's Data Direct line, calls CRM-ERP integration "a hot topic right now." He adds that "more customers are seeing value in it."

The value is more than theoretical, says Matt Keenan, group vice president of CRM products at Aptean. "There is real tactical and tangible value in the integration."

"You can get a more complete and comprehensive view of the customer to reduce costs and increase profits," Reser says. "It gives a 360-degree view of how the business is doing."

This is especially important as employee roles change, particularly as customer service agents are being tasked with more sales and, in some cases, billing and collections functions.

"If you want to sell to the customer, you need to know what he's been doing with the company, and some of that data is in your back-office systems," says Jim McGeever, president at NetSuite. "The only way to fully enable the right kind of interaction is in tying the front and back office together."

Connecting ERP and CRM systems can yield "the ultimate customer service management program," Petouhoff adds, "because you're really getting the full view of each customer, how they feel about your company, and what you deliver to them and how."

The benefits also extend far beyond sales and customer service. Every aspect of the business, from pricing, demand planning, product design, manufacturing, inventory sourcing, logistics, accounting, and even human resources, stands to benefit from a single view of the customer. And each can have an impact on how the customer views the company as a whole.