CRM (Customer Relationship Management) - Set of methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. It includes all business processes in sales, marketing, and service that touch the customer. For example, an enterprise might build a database about its customers that describes relationships in sufficient detail so that management, salespeople, people providing service, and even the customer can access information, match customer needs with product plans and offerings, remind customers of service requirements, know what other products a customer has purchased, and so on. In contrast to customer care, Customer Relationship Management tends to be used to deal more specifically with the integration of all business functions with each other.
ERP (enterprise resource planning) - ERP is a business management system that integrates all facets of the business, including planning, manufacturing, sales, and marketing. As the ERP methodology has become more popular, software applications have emerged to help business managers implement ERP.
If your company is planning to implement CRM, there are four key concepts that you need to understand:
CRM is about customers. Customers are people (usually) who make buying decisions. That distinguishes them from consumers, who make use of your products and services, and from the wallets, who provide the money. It is, however, easier if your customers, consumers, and wallets are all the same individual.
A company that adopts CRM will treat customer relationships as assets. That means it maintains them, performs preventive maintenance on these relationships, invests in them, and measures the return it receives from them -- each customer's LTV (lifetime value). Customer service happens one interaction at a time; CRM integrates all interactions with each customer.
A third concept is that not every company is ready for CRM. Just as there are capability-maturity models for software development and IT operations, so there are capability-maturity models for CRM as well.
Customer relationships aren't to be left to chance; you have to design them. This means you don't start by analyzing the customers you have. You start by targeting the customers you want and deciding how you want them to relate to you.
In the end, customer relationships happen one interaction at a time, mostly between individual customers and individual employees. CRM software is just a tool you provide to make your employees more effective in handling those interactions.