What is the difference between ERP and EPM?


Difference between ERP and EPM

Running an enterprise is not easy; it takes more than a qualified team to run your operations seamlessly. It is only when you integrate your ecosystem with the right blend of software, you can manage your operations seamlessly and effortlessly. Talking of software, two such systems are most helpful and utilized and often confused due to their functionality. Yes, we are talking about the confusion between Enterprise Resource Planning (ERP) and Enterprise Performance Management (EPM).

While these software systems might overlap in their functionality and feature on their surface, both EPM and ERP are entirely different software systems. Confused about which one is more useful? Which software system is easier to implement? Or, which of the two will add maximum value to your organization? Read along to understand the basics, functionality, and the difference between ERP and EPM.

ERP vs EPM: The Difference


ERP systems are software that is running the primary functions of a majority of businesses. These software systems allow business owners to execute multi-level operations in a business. An ERP system manages manufacturing, finance, services, supply chain, procurement, and more. This way, ERP remains centrally focused on transactions and optimization of organizational resources while also reflecting economic conditions.

Every individual software module in an ERP system is focused on one specific area. This way, the software system provides flexibility to businesses, allowing them to pair modules as per the business requirements.


EPM or Enterprise Performance Management can be defined as a suite of engineered applications to help streamline the overall management processes. EPM is in charge of modeling, planning, consolidation, and reporting data obtained by a single or multiple ERP systems. This way, the software system provides real-time analytics for improving business decisions.

Generally used to assist the CFO and finance department, EPM is used to analyze, monitor, and manage an organization’s performance by allowing the management to optimize their performance and allocate their resources skillfully.

Now that we understand the functional difference between ERP and EPM, let’s look into some of its key features:


The Dilemma: Which Software System Should I Implement First, EPM or a New ERP solution?

Whether you go for an ERP or EPM. From this perspective, ERP starts where EPM ends as both the systems carry a different goal of transaction execution and performance planning optimization; respectively. This way, if planning is good, the businesses will be able to tap into efficient transaction processing faster and help the company with more accurate management and financial reporting. This way, businesses can move in for a more natural inclination towards both scenarios.

On the other hand, if you want to implement a new EPM solution before opting for an upgrade for the ERP systems, it will serve as the key to improving management and financial process and performance improvement. When you opt for an EPM solution first, it provides the end-users with a consistent, stable platform that allows seamless reporting, budgeting & planning.

Currently, a majority of modern EPM solutions allow you to integrate your data into a variety of ERP systems, adding flexibility and a more multidimensional approach to analytics and reporting.

ERP vs. EPM: The Overall Time Required for Integration

When comparing with the time factor, EPM implementations take a typically shorter time compared to ERP implementation into your ecosystem. Adapting to an ERP can take your organization anywhere between three or more months.

Interestingly, when your organization plans to adapt to the EPM solution, your organization can curate and implement a corporate chart that allows seamless accounting and reporting to the hierarchies. Later, you can also integrate these functionalities with your current and/or future ERP systems.

The Ideal ERP System?

ERP solutions are software compatible with enterprises of every shape and size – small, midsize, and large. You don’t necessarily have to run global enterprises to implement such a software system. Talking of the ideal solution, we suggest you integrate the SAP ERP system to ensure the success of your business.


No matter your business process background, it is always a smart move to plan your EPM and ERP system upgrades or replacements very carefully. Adapting to either of the two software systems is your organization’s opportunity to improve core processes. Moreover, in some instances, integrating a new EPM system can also help you alleviate an ERP replacement requirement.

As is seen in the post-pandemic environment, companies are now upgrading and modernizing their on-premise ERP and EPM to cloud deployments for improved management of the business operations.