Enterprise Resource Planning (ERP) Software Explained

Sales reps need access to a mix of apps to do their jobs well — from platforms that provide up-to-date lead information and real-time inventory details to programs for financial reporting and contract management.

An enterprise resource planning (ERP) system helps bring all of a company's tools together, allowing sales and other departments to share data. When operations are coordinated thanks to ERP software or similar solutions, sales reps can speed up the quote-to-cash process, forecast sales more accurately, and collaborate with teams more smoothly.

Learn more about what enterprise resource planning is, why it matters, and the alternatives that can help give you a better understanding of your business.

ERP is software that runs key business operations in one connected system, helping teams work more efficiently and make better-informed decisions. It brings together functions like finance, manufacturing, HR, sales, procurement, and supply chain, giving decision makers access to real-time, comprehensive data.

An ERP system brings together software, data, and workflows, allowing access to each through a unified interface. It also facilitates data sharing, promoting consistent communication between departments. For example, when organizations integrate a CRM like Salesforce with their ERP solution, they connect sales, marketing, and customer service with operations, finance, IT, and HR.

ERP systems integrate data and processes from different areas of the business, such as HR, accounting, procurement, and manufacturing. This ensures every application can access the same information, creating a unified view of business activities. The ERP not only stores data but also automates tasks and information sharing between applications to streamline processes and improve reporting.

Customer relationship management (CRM) systems are more specialized, focusing on what sales teams need to achieve from early sales and marketing touchpoints through customer service and retention efforts. ERP systems, meanwhile, can include every aspect of business operations but often focus more on accounting and less on features for sales teams.

• CRM systems track sales pipelines and customer engagement throughout the entire customer lifecycle, manage customer interactions, and improve direct customer service. They can be integrated with ERP software, which can be a smart move if the ERP software has limited sales and customer management capabilities.
• ERP systems encompass multiple business operations and can also include back-end processes related to procurement, HR, accounting and finance, inventory and supply chain management, and more.

ERP gives business leaders a way to determine the best use of their resources, from financial assets to workforce planning, so they can operate efficiently and stay competitive. It also helps those on the front lines navigate processes across the organization more effectively. For example, smart ERP allows sales reps to have more time to build positive customer relationships and analyze reports.

Some may think that ERP is only necessary for larger business operations, but that's not true. Small businesses typically have to do more with less, making ERP just as necessary — especially when they can save time and effort by automating routine tasks. Small businesses can use ERP solutions with no-code interfaces that allow for simple, needs-based customizations.

An ERP system is valuable because it connects core business functions in a single platform. This helps organizations operate more smoothly and strategically by improving collaboration between teams and departments, sharing cross-functional data to create a single source of truth, and enabling real-time insights for better-informed decisions. ERP systems can also improve efficiency and reduce costs through process automation. And by adding third-party software integrations to unite sales, service, marketing, commerce, and IT in one platform, businesses can improve their scalability.

ERP systems can be set up in different ways so organizations can best fit their technical needs, budget, and goals. These are the three main types and what they offer:

Onsite or on-premises ERPs give organizations complete control of the software and full responsibility for its security. Since it is deployed and accessed on company servers, it requires dedicated onsite IT resources for maintenance and support. However, this limits access to a physical location, making it difficult or impossible for field personnel to use it.

This type of ERP uses the software as a service (SaaS) model, allowing anyone with a login and internet access to use it. Typically, this looks like a subscription, which includes data hosting, training, flexible customizations, software updates, and support as needed.

Also known as two-tier ERPs, these are a combination of cloud-based and ERP solutions. Organizations that choose this model typically host select applications and their data in the cloud, with others accessible only through an on-premises server.

Shopping for and evaluating ERP systems can be overwhelming, but you can simplify the process by starting with your primary business goals. Gather apples-to-apples information on various ERP software options to determine which will work best for your business.

Here are some of the top factors to compare across your ERP options:

Consider who will most often access various features of your ERP and where they are located. If everyone works in the office, an onsite ERP may be the best option. If most employees work remotely or in the field, a cloud-based ERP is likely the better choice. To make your decision, weigh how much control you want and whether you have the resources to host and maintain your ERP.

Modern ERP software should include some form of built-in artificial intelligence. Compare where and how the AI in each ERP system is applied. Then examine whether (and how) it is built into process automation, data analytics, customer interactions, reporting, and forecasting.

Consider how customizable the reports and dashboards are. Powerful AI and flexible reporting options provide the best and fastest insights in real time to help your leaders and frontline employees make quicker, more informed decisions.

Ensure the ERP options include built-in automation to reduce manual tasks. Identify the automation options for processes your teams use most frequently and where you see the most human error. This could include order management, inventory management, invoicing, and scheduling.

Specialty modules or integrations with third-party software are essential. They enable scalability and custom adaptations to meet your business needs, covering everything from accounting, HR, sales, and marketing to inventory and warehousing, supply chain management, procurement, and purchasing. Some ERP software offers adjustments via no-code or low-code modules, while others rely on APIs. Consider which option works best for your business.

While many businesses find ERP systems beneficial for managing internal processes, other solutions may be a better fit for complex workflows and customer-facing operations. On their own, ERPs often can’t support critical business functions like managing sales pipelines, driving customer engagement, or meeting industry-specific compliance‌ requirements.

​​To address those gaps, organizations can turn to flexible, integrated software.

An AI-powered platform like Sales Cloud can help you create a connected ecosystem where internal and external information flows across your sales, marketing, revenue, executive, and administrative teams. This can mean greater operational agility and better-informed decision-making at all levels.

When looking at ERP alternatives, consider software with these features:

• Scalability: Enterprise systems need to be able to grow with your business. Pick a solution that lets you start small but expand easily with ready-made integrations and add-ons.
• Customization: While out-of-the-box tools can work fine, platforms that can be tailored to your needs for sales, customer service, marketing, and commerce will typically deliver better results.
• Automation: A major benefit of having interconnected systems is reduced manual work. Your system should be able to handle tasks like logging data and triggering next steps in a workflow.
• Artificial intelligence: Systems with AI assistants can help you quickly parse large amounts of scattered information. Some even use autonomous agents that can take action and, over time, learn from outcomes to become more efficient at helping you.
• Innovation: Cloud-based platforms deliver ongoing updates so you can take advantage of new features as they’re released. A strong community of users can also help you get more value from your tools.

ERP software can help companies improve collaboration, customer service, and productivity by consolidating cross-functional systems and data into a single platform. Traditional ERP software isn't the only way to meet this need. Consider AI-powered software like product.agentforce to close the gaps and fuel your business.