What Is The Difference Between Accounting Software and ERP?

The fact that there is a wide variety of accounting software available in the market makes it difficult for entrepreneurs to differentiate between software that supports accounting operations and Enterprise Resource Planning (ERP). Additionally, the confusion among business owners and company executives becomes profound when they realize that there are third-party modules capable of performing accounting functions that are not necessarily ERP software.

As such, there is a distinct difference between ERP and accounting software and here is some insight on how to separate the two.

Sales Management and Order Processing

Accounting Software — Sales Management and Order Processing options are some of the missing provisions for those who depend on accounting software.

ERP — Part of the core provisions for ERPs includes Sales Management and Order Processing. ERP sales order management incorporates such as promotional pricing, management of complex orders, kitting and inventory allocation apart from attending to customer orders and shipping requirements.

Lead Management

Accounting Software — It is impossible to manage leads using accounting software because this solution initiates interactions with existing customers only or those who make purchases through a purchase invoice or sales invoice.

ERP — The ability to track leads is made possible with ERPs because the system establishes contact with individuals even before they become customers. ERPs have a dedicated CRM module that allows users to identify campaigns that generate leads, write and track emails as well as access up-to-date lead contacts for effective management.

Manufacturing Management

Accounting Software — Acquiring necessary software for management of production processes is a critical requirement for those who operate production factories. This is a function that accounting software does not constitute. As such, the absence of manufacturing management capabilities in accounting software poses limitations to efficiently controlling operations.

ERP — Monitoring the floor space in a factory will help workers gather details regarding machine breakdowns, customer orders, deliveries, stock levels, availability of resources, changes in requisitions among other things. ERP software gives you visibility to all factory operations making it a resourceful manufacturing management tool.