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ERP and BI Software – What’s the Difference?

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Businesses often confuse enterprise resource planning (ERP) software with business intelligence (BI) software, but these programs serve very different functions. Companies that learn the difference between these two applications will find the right tech solution to their business problems. Here are some of the benefits of both of these tools for small and medium-sized companies.
ERP Software


ERP combines multiple tools into one system so businesses can manage various back-office functions at the same time. These programs integrate financial information, manufacturing data and key metrics, and they provide accurate insights at every stage of the supply chain. ERP software also has a dashboard where users analyze data for more effective marketing. This information helps businesses make smarter decisions in a shorter time frame: Research shows that real-time analytics help companies decrease operational costs by 23 percent and administration expenses by 22 percent.


ERP has numerous benefits. It improves customer service and enhances payroll and human resources management. It also streamlines inventory control: Modern ERP applications provide distributors with an inventory accuracy average of 97 percent. As a result, more small and medium-sized companies have adopted this technology to manage stock and meet customer demand.
BI Software
BI software also combines various tools into one all-encompassing system. However, this program has been designed to analyze business data so companies make informed decisions throughout the supply chain. Some of the tools that comprise BI software include spreadsheets, data mining applications and operational dashboards. All of this information helps organizations make accurate forecasts about the future of their business.


Although BI programs range in price and scope, they all serve the same function: They help companies make fact-based decisions. Research shows that businesses that use analytics software like this are five times more likely to make faster decisions than businesses that don’t. This is part of the reason why BI has grown in popularity among small and medium-sized business owners. Studies suggest that $14 billion is spent on BI software every year and $55 billion is spent on BI-related services.
The Difference Between ERP and BI
ERP and BI have fundamental differences. While ERP manages various back-office functions — reporting, payroll, inventory control, staff acquisition, etc. — BI focuses solely on reporting. Both programs prove beneficial for small and medium-sized businesses. However, BI might be better suited to a marketing team that can analyze trends and data.

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