Essential Differences between ERP System & Accounting Software Thumbnail

The world is growing so is the data & information that can be stored. It is becoming more complex to handle operations within a business manually. That’s why there are ERP systems & Accounting software to automate operations. So, productivity can increase, and time taken for a specific task is reduced.

But, are there any differences between ERP system & Accounting Software? The answer is “Yes.” For a long time, businesses used to depend on accounting software for their financial reports & payables. After the introduction of the ERP system, it’s becoming more popular amongst business leaders.

You might understand the reason when you get to know about each one of them.

What is an ERP system?

ERP, is Enterprise Resource Planning, refers to a specific type of software or system utilized by businesses to manage and plan everyday activities like manufacturing, supply chain services, financials, and many other procedures. Enterprise Resource Planning software can be utilized to simplify and automate individual processes across an organization.

What is Accounting Software?

Software for accounting is a type of computer program that aids bookkeepers and accounting professionals in keeping track of and reporting on a company’s financial transactions. An Accounting software’s functionality is different from one product to the next. The most modern accounting software is constantly linked to the web. It means you can connect using any internet-connected device such as your smartphone or laptop.

Essential Differences between ERP System & Accounting Software.

With the ERP system, businesses are able to compete more effectively as compared to accounting software. You might be able to understand the reason for it when you go through the essential differences between ERP system & Accounting software:

Wide Scope of Software.

On the one hand, Accounting Software can only maintain accounts and financial records. That’s why it has limited features and functionalities. On the other hand, an ERP system is a set of modules that can automate the operations of every department within an organization. So, it has a broad scope of fields to improve.

An ERP system can be viewed as 360-degree software that has the capability to become a single system of an entire company. A wide range of services can be obtained. So, productivity will increase, and that can improve growth and revenue.

Fulfills Specific Industry Requirements.

In general, accounting software is only one for all businesses. The features might vary from one to another vendor. It can’t fulfil industry-specific requirements. But, ERP systems come under industry-specific categories. So, it can provide a unique set of tools that are made especially for a particular industry.

The industry-specific ERP is built by doing a deep analysis of challenges and obstacles faced by a business of the industry. In this way, it can manage the operations and overcome challenges efficiently.

ERP Includes CRM Tool.

An ERP solution allows the ability to manage sales and orders. ERP solutions typically come with a CRM integrated module that allows users to view up-to-date contact information and past communications.

While standalone accounting software doesn’t have these features, it will be much more beneficial to have a system that includes an integrated CRM tool. So, it enables you to build deeper relationships with your customers.

Limited Real-Time Information.

ERP incorporates all financial data within one database. By providing a single solution to various business processes, ERP solutions eliminate the requirement for multiple tools to handle the demands of multiple departments. You won’t find this feature in general accounting software.

In addition, company-wide data is accessible via the cloud to give anyone, anywhere access to current information on a mobile device. ERP systems link every aspect of the company, ensuring that every decision based on real-time data can be made.

Why is ERP System better than Accounting Software?

The reality is that it all boils down to your company’s requirements. There may be only accounting software to manage essential financial data collection and reporting in some cases. However, if you need more and more, an ERP system is the only option to proceed.

A lot of businesses are discovering that traditional accounting software is becoming less and less popular as companies shift towards wholly integrated business management software to satisfy their requirements. Although a part of this change can be attributed to the ERP suppliers worldwide seeking to increase their capabilities, most businesses are more than happy with an integrated system that has complete capabilities.

An ERP will allow more integration of business operations into one system, including elements like warehouse and inventory management and customer relationship management, supply chain management, etc. All of these are not achievable with stand-alone accounting software.


If you are looking for a single unified solution for your organization, it should be an ERP system. You must have understood from the essential differences between ERP system & Accounting software that ERP is better than an accounting system. It’s much more reliable & considered to be adopted by every business in near future. So, it would be best if you implemented it from the right ERP vendor to have a competitive advantage over your competitors.

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