Picture a mid-sized textile company in Bursa. The sales team writes customer orders in a separate notebook. The accountant re-enters those same orders into the accounting program. At month end, the owner reviews paper reports to make decisions. All three tasks get done, but none of them talk to each other. Why is the stock count negative? Which customers keep coming back? Which product actually makes money? The answers to these questions are buried in three separate folders, three separate programs, going nowhere.
ERP, which stands for enterprise resource planning, is a program that brings together a company’s core operations — accounting, inventory, purchasing, and production — under one roof. CRM, or customer relationship management, is the program that tracks when the sales team spoke to which customer, what offers were made, and what the order history looks like. BI, or business intelligence, takes data from both of these sources and turns it into meaningful tables and reports for management. Each one is useful on its own. The real problem is this: many SMBs in Turkey buy and manage these three systems as completely separate projects, with no connection between them.
What does this separation look like in practice? The sales rep enters a new customer order into the CRM program. That information does not reach the ERP system. The accountant then re-enters the same order into ERP by hand. Data moves between the two programs either on a floppy disk or over the phone. In the process, dates get entered wrong, quantities get written short, or the order never gets entered at all. The BI program, not receiving clean and regular data from either source, cannot give management an accurate picture. The owner looks at the report on the desk, but that report does not reflect reality.
These three systems need to feed each other because operations records, customer information, and analysis are all part of the same chain. When a customer places an order, that information should appear correctly in both CRM and ERP at the same time. When stock runs low, purchasing should be triggered. At month end, the BI program should be able to pull a real sales analysis from that clean data. When this cycle works, the manager finds the answers to questions like ‘which customer orders most often, which product is sitting unsold, which region is falling behind’ already waiting on the desk. When the cycle does not work, those answers are either missing or wrong.
To make the benefit concrete: a customer called three times last month, each time asking ‘where is my order?’ The sales team logged those calls in CRM but had no connection to the shipment information sitting in ERP. Each time, the customer got a different answer. Eventually, the customer moved to a competitor. If CRM and ERP had been looking at the same data, the sales rep would have seen exactly where the order stood the moment the phone rang. This single example shows how integrated systems prevent customer loss. Similarly, the BI program could have flagged each month which customers were showing signs of drifting away — but only if CRM and ERP data was flowing cleanly and consistently.
The biggest obstacle to this kind of integration is not technical. It is organizational. In most SMBs, the accounting department bought the ERP, the sales manager requested the CRM, and the owner saw the BI program at a trade fair and liked it. Three decisions made at three different times, from three different budgets. Nobody planned from the start how these three programs would connect. On top of that, buying from different vendors makes the technical connection harder to build. The authorized reseller typically prices this integration as a separate project, and the SMB budget does not stretch that far. The result is three programs sitting side by side, none of them talking to each other.
As an SMB manager, before buying these three systems or during a renewal, the right question to ask is this: do these three programs come from the same vendor, or can they exchange data with each other? Does the reseller include this integration in the project from day one, or does it come later as a separate line item? If the three programs will run independently, the manager needs to ask how reliable the reports coming out of that setup really are. A BI program running on bad data produces nothing more than attractive tables built on errors. Attractive tables are not enough to make decisions — accurate data is what matters.
This article was originally written in Turkish by Gökhan MERCANOĞLU on July 21, 2003 and has been automatically translated into English and other languages using machine translation.