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There are several solutions that simplify business management. Among them are two that usually cause some confusion in the minds of many managers: BPM and ERP. The confusion is normal, since the implementation of both systems aims at increasing efficiency and profit, and reducing costs. However, despite the similarities, there are differences between BPM and ERP.
In this article, we point out the main differences between ERP and BPM. In the end, we hope we can help you define what is best for your business. And to get you started, here is a brief explanation of BPM and ERP.
What is ERP?
Enterprise Resource Management (ERP) is a software that integrates a set of programs to collect and manage data. It is composed of specialist modules such as financial, accounting, production, manufacturing, HR, among others, which are characterized by a multitude of screens, reports, and parameters, always with a transactional view.
ERP is used to control and organize company information, integrate and manage resources and processes in order to optimize company management, reduce costs, and minimize risks. Other benefits of ERP include improved business insight, since it is possible to extract real-time information from the system; and more efficiency and collaboration from users who share data in contracts, requisitions, and orders.
What is BPM?
If you follow our blog, you may have already read some of our articles about Business Process Management (or simply BPM). Gartner defines BPM as means to improve a company operational performance and agility. Thanks to the solution, information flows better and processes gain more consistency. Consequently, the company delivers more value to customers.
BPM is an adjustable management methodology developed with the objective of organizing and facilitating organizational processes of low or high complexity, internal or external, in corporations.
As we commented in this post, the BPM discipline and systems came to fill an important gap left by ERP, with a vision oriented to processes, integrations, and management, aiming to allow end-to-end control of all the company data, documents, and information flow in an integrated way.
Among the main advantages of using BPM is the significant improvement of processes, which allows the organization to be more efficient, assertive, and prone to change than those that use functional focus, with a traditional management approach.
Since the focus of this article is the differences between BPM and ERP we will not delve into the concepts. But in case you are interested in knowing more, we recommend reading the post: What is Process Management (BPM) and what are its benefits?
What are the differences between BPM and ERP?
To begin with, ERPs are tools for storing data from different areas in a single place. BPMS, on the other hand, is an integrated solution for process management and automation.
Among the differences between BPM and ERP, the main one is that while BPM solutions are more process-focused, ERPs are limited to organizational functions. Still, with an ERP, activities are “tied” to a particular department. BPM software, on the other hand, allows the creation of interdepartmental processes.
Also as differences between BPM and ERP it is important to note that ERP usually needs BPM to get its full value. Besides, Business Process Management solutions are more flexible and generally require less effort to implement.
It is important to say that both BPM and ERP are used to manage processes and can even solve similar problems. The real differences between BPM and ERP may be more visible when a BPM tool (BPMS) is integrated with ERP. In this case, the BPMS can bring together systems, applications, and repositories that an ERP system may not have access to.
To complement the differences between BPM and ERP, a Business Process Management solution solves the problem of broken and inefficient processes that can slow down the ERP.
Which one is ideal for my business: BPM or ERP?
In short, from the differences between BPM and ERP that we have analyzed, we can say that BPM solutions are process-focused, while ERPs follow a parallel task-focused path.
An ERP can even help your employees with task automation, but if you feel it’s time for your company to orchestrate several chained tasks and obtain tactical and strategic information, there is no doubt that BPM will accomplish this mission with excellence.
It is also important to emphasize that, as we mentioned in the article How BPM powers your management systems (ERPs), Business Process Management software must be considered in any digital transformation strategy, paperless initiatives, or simply with the goal of raising the bar in terms of effective control of any business.
Finally, if your organization already uses an ERP and is not achieving the goals described at the beginning of the implementation, it is very likely that the system is not entirely to blame. There is a high probability that the ERP failures are in the processes. In this case, by implementing a Business Process Management solution you will see improved results in your ERP system. Keep in mind that a BPM solution is a requirement to help create a successful ERP system.
In closing (with bonuses)
Since our goal in this article is to answer your questions about the differences between BPM and ERP, here is our summary:
- BPM is an integrated solution for process management and automation. ERPs are tools for storing data from different areas in one place.
- BPM fills an important gap left by ERP, with a process-oriented view, integrations and management.
- BPM solutions are more process-oriented, while ERPs are limited to organizational functions.
- In an ERP, activities are “tied” to a particular department. BPM solutions, on the other hand, allow the creation of interdepartmental processes.
- BPM software is more flexible and in most cases requires less effort to implement.
- ERP often needs BPM to help it achieve its full value.
- BPM solutions often solve the problem of broken and inefficient processes that can slow down the ERP.
We hope you were able to understand the main differences between BPM and ERP. In case you are still evaluating whether your company really needs a management system, we recommend an infographic that we developed especially to show you the options available in the market. In the material, we present the meaning and the focus of HRM, Analytics, ECM, SCM, CRM, MES and, of course, BPM and ERP solutions. Check it out!
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