Creating a cohesive relationship between systems
The heart of any supply chain organization is often the ERP (Enterprise Resource Planning). ERP is the system that allows companies to execute a financial transaction with a customer in return for a service or good. As supply chain companies expand their digital transformation and explore CRM solutions, we often find there is some resistance between advocates of ERP vs CRM, as to where the customer master, or source of truth for account details resides. We typically hear:
- “The ERP is the source of truth for all our data, and needs to drive everything else (including our CRM)”
- “We’re trying to fold the sales team into following how operations manages the ERP, but that’s not how they sell, or how sales views our customers”
- “We’re most heavily invested in the operations of the business, and sales has often been a secondary priority”
- “We’re trying to bend our ERP to be a CRM, and it’s not working. Or vice versa”
More often than not, organizations have a bias towards adopting the account structure in place within an ERP, which results in handcuffing your CRM. The power of platforms like Salesforce in supporting account or customer facing teams is diminished, causing poor adoption and return on investment.
Golden rules of defining ERP vs CRM
In our experience, the conflict comes out of the fact that there’s a definitional problem between how an ERP and CRM look at the same customer. From one vantage point, you could argue it’s all the same data - it’s dollars and product attached to your customers. However, ERP and CRM look at this data through different lenses, by different definitions:
- ERP serves supply chain and needs to treat customers as transactions with fulfillment locations
- CRM serves sales and needs to treat customers as businesses and people with whom to have relationships with
The answer is to resolve the difference in the definitions that is the source of the conflict. Specifically, it's important to clearly understand these definitions in order to enable employees to do the best job possible by following the golden rules:
- Have account management teams nurture relationships through a CRM. Let supply chain professionals manage the transactions through ERP
- Define what your teams need first - outside of the technology
- Translate, negotiate, and barter in the middle to support each team’s definitions
The reason CRMs have struggled to make good ERPs, and vice versa, is that each defines customers differently and therefore, doesn’t enable processes for operations or sales if you try to force fit them in one another.
6 steps to solution design for your system
Creating the right solution for your CRM account structure to complement your ERP requires a thoughtful approach. It’s important to respect the goals of each system and reconcile the differences through your integration. Consider the following steps to a successful design approach:
- Define what a customer is in each system. Determine what structure and attributes operations need to fulfil a transaction. Also question what door do sales people knock on; and what sales data should be aggregated?
- Respect these definitions, make them the laws of your universe, and do not force either your CRM or ERP to adopt the definitions of the other system unless they’re in common
- Build an account structure that supports these laws, and wrap any extra data you need around it
- Customer data may have multiple entities in multiple different systems, it’s crucial to only bring in data that supports your sales team
- At the end of the sales cycle, consider what data is needed to commit a transaction to your ERP. Build a process to enable the translation from the CRM to your ERP at that point in time
- As long as your definitions are clear, the heavy lift is in the translation in the middle
Facilitate your account relationships with salesforce
The right account model is the heart of a CRM implementation. Getting this right is likely the most critical step in your implementation of a CRM like Salesforce. The account structure ultimately impacts how you build, nurture and quantify the performance of your relationships with customers, channel partners and service centres. For supply chain organizations to maximize their ROI, every role that manages these relationships, needs to access the salient details about their accounts.