ERP or CRM? How to choose the right growth solution.

Most businesses start out using spreadsheets and Microsoft Word documents to track and manage their data.

This is usually supported by an accounting system like MYOB or Xero, which doubles as a makeshift Customer Relationship Management (CRM) tool.

Over time, there becomes an overreliance on the information that’s only accessible via the business owner’s inbox, and what they store inside their head.

Eventually, the question must be asked – “What software should I use to scale my business?”

What is an ERP or CRM anyway?

A CRM is a Customer Relationship Management tool. It helps your business to manage your interactions with customers and potential customers in a streamlined way so you can increase sales, improve customer service and increase your profit margins.

An ERP is an Enterprise Resource Planning tool. It helps a business to manage day-to-day operations such as accounting, procurement, project management and supply chains.

Both automate business processes, and both create a centralised data management solution, giving access to insights and information across your business.

What is right for my business?

When you make the decision to implement an improved data management solution into your business, and ask yourself the question “what software?”, silence is what usually follows. Then there’s the Google searching that leads to head scratching, that leads to more questions and decision-making comes to a standstill for another six months before the same question rears its head again.

Unfortunately, it won’t go away, no matter how hard you try to ignore it (just like the ATO!)

Here’s what you should do before you decide.

If you’ve been asking the question about which software to use, here’s my tips for reducing the headaches and getting your business ready to grow.

Tip #1 – Ask your competitors what they use.

It may seem odd at first to ask a competitor for help, but in my experience competitors are usually happy to hear from you, and collaborate on various questions. They might be stuck in a similar position and you can share the research, or they might have a few good and bad stories to help you avoid making the same mistakes they did.

Tip #2 – Reach out to your network

Talk to your accountant, bookkeeper, lawyer and of course, your IT partner. They will probably know someone who can help, or even an ERP vendor who specialises in products that do exactly what you want, or can be made to do what’s required with only a few tweaks.

Tip #3 – Don’t fall into the “I’ve got a mate” trap

“I’ve got a mate who can write a program for me!”

Don’t fall for this trap. Run for the hills! It usually ends up costing you waaaayyyyy more than it saves. No matter how well intentioned your friend is, inevitably he will go AWOL one day and leave your critical business system in limbo. It will then cost you twice as much to move it to a different platform than it would have cost if you’d simply done it properly in the first place.

Tip #4 – Don’t expect the software to suit your workflow perfectly

Many business owners (myself included) moaned and groaned when we implemented our first ERP system. It will feel slow and it will feel like you could have done it five times faster the old way. We then call the software provider and ask them to change their software to suit us. They politely tell us how much it will cost to make that change specifically for us. And we quickly decide to change the way we work to suit the software instead.

Trust me. Once you get used to it, it will get easier. It might never be as fast as the old way, but the old way wasn’t scalable, wasn’t secure and was only fast for you because you understood it – no one else in your business really knew how to use it.

Tip #5 – Shop around

A quick Google search will find you a dozen possible options.

Salesforce, Zoho, Monday, ServiceM8, Tradify, Kalysys, MYOB Exo, MYOB Advanced… I could go on for days!

They all have their strengths and weaknesses. They all have different price points and subscription types. But many of them, particularly the well-known ones get VERY expensive. Check out a few options, talk to people, don’t just settle for the one that spends the most on marketing because you may send yourself broke instead of making your business more effective.

Tip #6 – Microsoft Something…

I heard someone say recently that they use Microsoft Dynamics or Power BI or some other app in the Microsoft 365 suite as their CRM and that it’s heaps cheaper than what they were using before.

This might work for them, and yep, it might work for you.

But before you go all in on a bootstrapped style solution, make as sure as you possibly can that this is the best option for you.

As in the DIY option (see Tip #4), this option is heavily reliant on the person or business who develops it for you and it can get expensive really quickly!

I’m not saying you should rule it out. But I am saying that unless you really trust the people recommending this option to you, you’re bet to stick with an off the shelf product.

Do your homework. But don’t sit with indecision.

If your business is growing, you need a CRM or ERP solution.

Finding one that’s right for you and can grow with your business is key. Start simple. You won’t need all the bells and whistles in the beginning. The right solution will grow with your business and so will the cost – there’s no need to pay for features you aren’t using yet that will put your business under maximum pressure right away.

But don’t sit with indecision and confusion. Do your homework and go deeper than the Google ads – ask around and engage support from your IT partner. Then you’ll be well on your way to strategic business growth.

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