Integration of CRM with ERP, the Why and ROI

By - March 28, 2013

I’ve been fortunate to have worked on the implementation of over 250 CRM systems from several different software publishers over the course of my career and of those about 180 have been integrated to an ERP/Accounting system. Connecting the front office CRM to the back office ERP affords a business a number of strategic advantages.

Integration can mean different things to different people. There are a number of potential touch points between these two very different systems. For example both systems maintain the same customer information for the Account (Organization), Contact, and Addresses (i.e. billing and shipping). Some of the inventory in ERP is the finished goods products used for quotes and orders in CRM. Automating these touch points can mean the automatic creation of a new customer account in ERP from a prospect record in CRM when they are ready to purchase your goods or services and by sending orders created in CRM to the Sales Order module in ERP which eliminates duplicate data entry.

Most CRM systems evolved from sales force automation, marketing or customer service systems. Unless you staff is still preparing their quotes and orders manually on paper on using Excel, salespeople need access to a quote and order entry system. Salespeople also need access to order and invoice history, payment history, customer’s credit limit, account balance, and the customer’s account aging information (i.e. current, 30, 60, 90 days), which for most companies is information that is contained in ERP.

One of the reasons clients state as their motivation to integrate their systems is to keep the “non-accounting” people out of the accounting system. Some accountants flinch at the thought of non-accounting people entering transactions into their accounting system. Most sales managers will tell you that a very high percentage of quotes, in some cases 80% or more, never make it to the order stage. If you use your ERP to produce quotes for prospects, that can mean a lot of customer records created in the customer file that never become customers.

Imagine the information-sharing and visibility a company could leverage by integrating these two different systems. Having the sales data located alongside your CRM data gives a salesperson the ability to be able to identify sales trends and address customer questions. This integration can create a 360-degree view of the customer life cycle in one useful location. You can improve business processes, enforce business rules, increase the collection of key data elements, and improve reporting. Then there is the cost savings that comes from implementing workflow approval for quotes, orders, discounts, and reduce the manual labor required to enter orders in both CRM and ERP.

CRM can help you to manage customer relationships, increase the time you spend with customers, identify profitable customers, alert you to cross-sell and upsell opportunities, shorten the sales cycles, improve closing rates, enhance customer relationships, leverage marketing campaigns and offer better customer service, all of which increases the value from existing customers and acquiring new customers. ERP stores customers’ financial relationships with the company; CRM stores their buying patterns and marketing demographics. Unifying these two sources of customer data helps the organization ensure that their sales, marketing, and service expenditures are targeting their most valuable customers and prospects.

The secret is how to make these two very dissimilar systems work together as one, so that they communicate specific data to the other system depending on the business process currently in focus. The ideal goal is a two-way integration so that you only enter data one time in one of the two systems. The end result is that the two systems behave as if they are one system. An important point to remember is you can take the accounting process out of ERP, but you can’t take the accounting out of the process. The same controls still apply when you move an accounting process like quotes to orders to the CRM system. Some of them will ultimately find their way back to ERP as real orders and they must meet all the same standards set by your ERP as if they were hand entered into ERP.

In the past, it was difficult to integrate these systems because of the vastly different architectures in their solutions and the lack of standards for exchanging data between these systems. Today there are excellent tools, like Scribe Software that are available that allow us to achieve first-rate integrations between these systems.

The only reason to integrate any of your IT systems is to create ROI and a competitive advantage for your organization. The first step in integrating CRM with ERP is to define your business processes. In order for the integration to be successful, I recommend that you work with a business-solutions specialist who will provide your company with the insight needed to select an integration platform and develop a plan based on your functional needs and business processes.

At RSM we know and understand Customer Relationship Management! We are specialists in helping companies like yours get the most ROI out of your CRM implementation. RSM LLP is the nation’s 5th largest CPA firm providing Assurance, Tax and Consulting services. We know Accounting, we know CRM and most importantly we know how to integrate the two. We recommend and support Microsoft Dynamics CRM 2011 as we believe it has the best combination of features that are designed to help businesses like yours implement your company’s business processes.

Integrating ERP and CRM has the potential to create a 360-degree view of your whole organization. Are you ready to start? If you are looking for a CRM partner, have a new CRM project, or need help with an existing CRM project request a Rapid Assessment SM with our CRM professionals to help you evaluate your CRM options and identify a road map for your success.

Call us at 855.437.7202 or contact our professionals

By: Mark Soltis –   Microsoft Dynamics CRM Partner Kansas City


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