ERP Integration: 8 Best Practices To Get It Right the First Time
If you’ve ever googled your enterprise resource planning (ERP) software’s brand name alongside the term “integration,” you’re probably in one of two camps: You’re either hesitant to invest in a new system or integration, or you’re already facing that one mismatch no listicle describes.
ERP software can be a broad field, and depending on the vendor, it might include or integrate features for anything from finance and asset management to manufacturing and sales.
Knowing the ERP solution’s full capabilities when you’re first choosing and its data integration capabilities are essential because the real value of an ERP platform shows up once it no longer lives in a silo. Modern organizations rarely run a single application. Operational efficiency often depends on fully integrated CRM, e-commerce, payroll, warehouse management and other critical business applications that may or may not be provided from your ERP software vendor. So, how does it all play together, and how can you design or update different systems to avoid future headaches? Let’s find out.
ERP Integration Fundamentals
Let’s get the foundation right first. At a high level, ERP integration is the process of connecting an organization’s ERP system with other applications. As a rule, the goal is a constant data flow, but with the number of data source types and complex integrations increasing and generative AI entering the equation, even a basic cloud ERP integration setup can come with its challenges.
Instead of teams exporting spreadsheets and re-keying information, the right ERP integration method allows:
| Customer data to flow between your CRM and ERP solution. | Inventory and production data to sync between warehouse, manufacturing and finance. |
| Project or service data to connect with time-tracking, billing and reporting tools. | Fewer errors from manual data entry. |
| Real-time visibility across departments and a single source of truth for reporting and analysis | Faster processes and better customer experiences. |
To get there, though, organizations need to consider a few critical steps, either during ERP implementation or upgrades.
5 Integration Methods for Connecting Your ERP
There’s no one “right” way to integrate your ERP. Most organizations end up using a mix of ERP integration methods based on their systems, budget and long-term roadmap. As a general guideline when selecting an ERP Solution, it should cover at least 80% of your functional area requirements within their standard, integrated site of applications from the software publisher or its partners.
When creating custom integrations, here are five common integration methods you’ll encounter:
Point-to-Point Integration
A direct connection between two systems that enables them to exchange data without any intermediaries. This can be fast to implement for simple use cases, but it becomes hard to manage as the number of connected systems grows. Ten systems using point-to-point integration can easily balloon into dozens of brittle, one-off connections.
Middleware / Enterprise Service Bus (ESB)
Middleware or an ESB adds a centralized software layer between your ERP and other applications. Instead of every system talking to every other system directly, they all talk to the ESB, which manages routing, transformation and orchestration of data. This approach is more scalable and easier to govern in complex environments.
API-Based Integration
Modern ERPs and business applications expose application programming interfaces (APIs) that allow systems to communicate in a standardized way. API-based integrations are typically more flexible, easier to maintain and better aligned with cloud-native architectures than older file-based approaches.
Integration Platform as a Service (iPaaS)
An iPaaS is a cloud-based integration platform that provides tools, connectors and pre-built templates to connect applications, systems and data sources across on-premises and cloud environments. iPaaS solutions often include monitoring, error handling and low-code/no-code tools that allow business technologists to participate in integration projects.
Electronic Data Interchange (EDI)
EDI is a standardized method for exchanging business documents (such as purchase orders, invoices and shipment notices) electronically between organizations. If you work with large retailers, distributors or logistics partners, there’s a good chance they require EDI-based integration with your ERP instead of emailed PDFs or paper documents.
ERP Integrations With Microsoft Dynamics 365 Business Central
If you’re running or considering implementing Microsoft Dynamics 365 Business Central, you don’t have to start from scratch. There is a rich ecosystem of:
| Vendor-provided connectors to Microsoft solutions like Dynamics 365 Sales, Power BI, Power Apps and other products in the Microsoft stack. |
| AppSource extensions that provide packaged integrations with popular third-party systems (e-commerce platforms, shipping carriers, payroll providers, independent software vendor solutions, etc.). |
| Partner-developed integrations, such as those built and maintained by The TM Group, that extend Business Central to fit industry-specific workflows and legacy systems. |
When no packaged integration exists, The TM Group’s development team can design and deliver custom integrations using Business Central APIs, web services, middleware or iPaaS solutions — aligning the approach to your security, compliance and performance requirements.
ERP Integration: 8 Best Practices
Technology choices matter — but they’re only half the story. The other half is how you plan, govern and execute your integration projects.
Here are 8 ERP integration best practices to reduce risk, cost and complexity.
1. Define Measurable Objectives
Start with the business outcome, not the connector. Before you design any interfaces, clearly define:
| Which processes you want to improve (e.g., order-to-cash, procure-to-pay, project billing). |
| Which KPIs you expect to move (e.g., order processing time, days sales outstanding, inventory accuracy, on-time delivery). |
| How you’ll measure success (baseline vs. target values, reporting cadence, owners). |
A good test: If you can’t describe the impact of your ERP integration on specific metrics, you’re not ready to start building. The TM Group often anchors ERP integration projects in broader goals such as unleashing your business potential through the power of ERP systems — as explored in more detail in this guide.
2. Establish a Canonical Data Model
Most integration pain comes from inconsistent data definitions. Each system has its own idea of what a “customer,” “item” or “order” looks like.
A canonical data model defines a standard representation for your key business entities that all systems can map to. For example:
| Decide which fields define a customer (ID, legal name, billing address, tax IDs, credit terms, etc.). |
| Standardize units of measure, currency codes and tax codes. |
| Define how product hierarchies and variants are represented across systems. |
This doesn’t force every application to store data identically, but it gives your integrations a common language, which reduces ambiguity.
3. Assign a Single System of Record
Even with a canonical model, you still need to decide where the truth lives. For each entity type, assign a system of record (SoR):
| ERP might be the SoR for customers, vendors, items and general ledger accounts. |
| CRM might be the SoR for leads, opportunities and activities. |
| A product lifecycle management or manufacturing execution system might be the SoR for bill of materials or engineering data. |
Your integration flows should respect the SoR by pushing changes out from it, and pulling changes in only when allowed by your governance rules.
4. Cleanse and Validate Data Before You Integrate
Integration doesn’t magically fix bad data — it spreads it faster. Before (and during) your integration project:
| Deduplicate records where multiple systems represent the same customers, vendors or items. |
| Standardize formats for addresses, phone numbers, email, tax IDs and other critical fields. |
| Set up validation rules to reject incomplete or inconsistent records before they enter the ERP. |
Many organizations combine integration projects with data quality initiatives to avoid embedding historical issues into new interfaces. The TM Group frequently helps clients audit master data as a precondition for ERP and integration success.
5. Use Versioned, Contract-First APIs
When you build API-based integrations, treat your APIs as long-lived contracts, not temporary shortcuts. Good practices include:
| Design APIs first, based on business requirements and your canonical data model. |
| Version your APIs (for example, /v1/customers, /v2/customers) so you can evolve them without breaking existing integrations. |
| Document request/response schemas, error codes and performance expectations. |
This contract-first approach makes it easier to onboard new systems, partners or vendors without having to redesign your integration from scratch each time.
6. Enforce Least-Privilege Access
An integrated ERP system holds some of your most sensitive data. To prevent integration from becoming a security loophole, follow least-privilege principles:
| Grant each integration only the permissions it needs (e.g., read-only for reporting, write access limited to specific entities). |
| Use service accounts, not shared user logins. |
| Require secure authentication (OAuth, certificates, etc.) and encryption in transit (TLS/HTTPS). |
| Log and audit who (or what) accessed which data, and when. |
This is especially important if you’re integrating with third-party applications, cloud services or external trading partners.
7. Implement Idempotent, Retry-Safe Workflows
Network blips, timeouts and temporary errors happen. If your integration simply “retries” without careful design, you may end up with duplicate orders, invoices or payments.
Design integrations to be idempotent, meaning that repeating the same request produces the same result as sending it once. Common techniques include:
| Assigning unique external IDs or message IDs so the ERP can detect duplicates. |
| Designing endpoints that update if the record exists, create if it doesn’t, based on a stable key. |
| Keeping a transaction log that tracks which messages were successfully processed. |
Combined with robust retry logic, idempotent workflows let you recover from transient failures without corrupting your data.
8. Centralize Monitoring With Alerts
Finally, even the best-designed integration needs ongoing visibility. Set up centralized monitoring for your ERP integration landscape:
| Dashboards that show the health and throughput of your integrations. |
| Error queues where failed messages can be examined and retried after correction. |
| Automated alerts (email, Teams, SMS, etc.) for critical failures or threshold breaches. |
Depending on your architecture, this monitoring may live in an ESB, iPaaS, Azure services or a combination of tools. The key is that your IT and business stakeholders have a single place to see whether data is flowing as expected.
Ensure a Successful ERP Integration, With The TM Group
ERP system integration is a core capability for organizations that want to improve performance and stay competitive.
When your ERP is seamlessly connected to the rest of your technology stack, data moves automatically between systems, reducing manual entry, cutting down on errors and giving your teams timely, reliable information to act on.
If you’re interested in learning more about ERP integration or need assistance with your integration process, contact The TM Group for a consultation.
