ERP vs. BPM: Which is best for your company?
Some companies may need BPM software to supplement their existing ERP system. Learn more about ERP vs. BPM and how these tools can work together to improve efficiency.
Organizations may find their business process needs aren't being met by their ERP software alone. If so, companies should consider implementing business process management software in addition to their ERP.
An ERP implementation is often a company's first step for automating processes and improving efficiency. BPM software, which is also abbreviated as BPMS, can then help support a company's continued growth. While ERP and BPM software have some functionality overlap, BPM software can refine and automate business processes at a deeper level than ERP software, which can help reduce costs, improve efficiency and reduce the potential for errors.
Learn more about ERP vs. BPM, as well as the situations in which organizations may benefit from implementing BPM software.
What is ERP?
An ERP system is software that helps companies manage their entire operations, including finance, purchasing and HR. An ERP system serves as a single database for storing company data, which can help with reporting and dashboards. ERP software also enables users to automate processes, which can help save time and ensure that forms and data are sent to the right people.
ERP software also provides employees with a consistent UI, which can improve overall UX.
What is BPM?
BPM software can complement ERP because, while ERP software does a bit of everything, BPM software focuses on automating processes and making them more efficient.
A BPM system captures current processes, models new processes and executes them if the user decides to go ahead with the new processes. BPM software also provides users with data about processes so users can potentially further improve them.
Should you implement BPM software?
The most common scenario is for companies to implement BPM software after having already purchased an ERP system.
Companies often automate routine processes using their ERP software. Over time, users may need to automate more complex processes, and their ERP system may be unable to carry that out. Employees may also find the company's ERP process automations difficult to use. Company leaders may then decide to implement BPM software to address the shortcomings of their ERP or other systems.
BPM software is often better at carrying out process automation than an ERP if workflows are more complex, multiple departments are involved in a transaction or advanced rules come into play. BPM software can also help refine processes so they are more well defined.
ERP software and BPM software can each use data from the other system, which can make working with both easier.
How ERP and BPM can work together
One example of the way BPM software can work alongside ERP is the vendor invoicing process. If a company uses BPM software, it can provide a vendor with a portal to submit an invoice, ensuring that all the necessary data is captured in the first step. Because the company's BPM software is integrated with ERP, BPM software users are able to confirm the vendor's details from the ERP software, such as open invoices and payment terms. Users can then send the invoice to the correct department based on the invoice's information, such as country or invoice amount.
Employees must follow internal regulations to ensure all invoices are legitimate yet still carry out the process as quickly as possible to avoid delaying the vendor payment. BPM software can help make this possible.
BPM software can also help improve other company processes, such as assigning a group of employees to an approval rather than one person and automating escalations.
For example, an employee may make a change to their health benefits that requires approval by a benefits specialist. In large companies, more than one benefits specialist may be able to approve changes, and users could set up the BPM software to notify all the specialists of any pending approvals so an approval is carried out more quickly.
In addition, automatic escalation can be useful if a particular employee is taking too long to carry out a particular task. BPM software can help configure a workflow process so the request is routed to another person after a set period. For example, if an approval is still pending after five days, the software can automatically escalate the approval to the employee's supervisor.
