Logistics Technology

Category Compare: ERP vs. Supply Chain Management

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In this report, we define and compare ERP and supply chain management software to help you decide which one aligns with your business goals.

Enterprise resource planning (ERP) software and supply chain management software are often mistaken for one another, but they have distinct functions. ERP software is a business operations management tool that helps streamline and manage core business processes, including accounting, sales, and HR. Supply chain management (SCM) software, on the other hand, is used to manage only supply chain-related operations, such as demand forecasting and order fulfillment. This report will identify the similarities and differences between the two software categories to help you understand which one is better suited to your needs.

What is ERP software?

ERP software is an integrated suite of applications that helps businesses manage key operations such as accounting, sales and purchases, customer relationships, inventory, and human resources. Unlike other software tools that cater to certain specific workflows, ERP solutions are all inclusive and provide a wide range of functionality to meet business needs.

ERP software simplifies collaboration between cross-functional teams, enhancing data flow and improving decision-making. This tool allows stakeholders from all departments to communicate and collaborate effectively, helping team members perform tasks more efficiently.

What is supply chain management software?

Supply chain management software automates the flow of raw materials from collection through production and on to delivery. It includes organization-wide order processing, transportation, and warehouse management, along with supply chain planning and forecasting features.

An SCM system improves operational efficiency—both upstream and downstream—by distributing and synchronizing supply chain data across multiple locations and throughout a business. It assists in tracking and scheduling items for just-in-time delivery at a business’s manufacturing facility. Some supply chain management tools use predictive AI to alert users about probable supply chain bottlenecks before they occur.

What do they have in common?

ERP software and supply chain management software have some similar functionality and features. Both the tools:

  • Streamline and automate business operations and strategies—ranging from administrative to asset management tasks.
  • Include financial planning and reporting features to optimize business value or profitability and minimize risks as well as costs.
  • Offer inventory management, warehouse management, supplier management, analytics/planning, and data sharing to help make informed business decisions.

ERP software features

Supply chain management software features

Which tool is right for you?

If you are looking for a tool specifically for supply chain operations, such as managing supplier relationships, order processing, and shipment tracking, then investing in SCM software would be the right choice.

But if you are looking for an integrated business operations management tool that extends beyond supply chain operations, then ERP software would make more sense. An ERP system caters to a wider range of business operations, including sales, accounting, HR, customer relationship management, and inventory.

Once you’ve decided which software to use, head to our ERP software and supply chain management software category pages where you can find a sortable list of products, software reviews from verified users, and comprehensive buyers guides.

If you wish to narrow down your search to only the most popular and highest-rated solutions, visit Capterra’s Shortlist reports for the top ERP software and supply chain management software tools—our reports are based on an analysis of thousands of user reviews.

6 top-rated ERP and supply chain management software

These six products, listed in alphabetical order, are among the top rated in both software categories.

Note: Reviews and ratings data in the product cards is as of March 16, 2022. New reviews may have been added since the publication of this article, so the reviews data in this piece may not reflect current conditions.
The products in the category comparison images are examples to show a feature in context and are not intended as endorsements or recommendations by Capterra. They have been obtained from sources believed to be reliable at the time of publication.

Methodology

To be included in the list, the products must:

  1. Be listed under Capterra’s 2021 Shortlist reports for ERP and supply management chain software. Learn more about the Capterra Shortlist methodology here.
  2. Meet our software market definition for ERP and supply chain management software:
    • ERP: “Enterprise resource planning (ERP) software is an integrated suite of applications that helps businesses manage key operations such as accounting, sales and purchases, customer relationships, inventory, and human resources. Unlike other solutions that cater to specific workflows, enterprise resource planning solutions are comprehensive in nature and offer a range of functionalities to address the needs of your entire organization. ERP software establishes links between departments, streamlining data flow and speeding up the overall decision-making process.”
    • Supply chain management: “Supply chain management software helps automate the flow of raw materials from collection through production, and on to delivery. Supply chain management applications typically include organization-wide order processing, transportation, and warehouse management functionality, along with planning and forecasting tools. Supply chain management software improves operational efficiency both upstream and downstream by distributing and synchronizing key data across multiple locations and throughout a business.”

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About the Author

Barkha Bali

Barkha Bali

Barkha Bali is a writer at Capterra, providing expert insights to help small businesses identify the right software for their needs by analyzing user reviews data for the highest rated products in relevant software categories. She has worked in finance, lifestyle, education, and medical. With expertise in marketing and content strategy, Barkha’s work has been featured in Medium and educational websites. When not working, she can be found re-watching “The Office” or “Brooklyn Nine-Nine.”

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