In the past, every resource you created in your Azure environment was a standalone entity without any relation to other resources. To create an operable environment for your system, you had to create each resource separately and configure the links by yourself. It was hard to see the full picture and it was hard to host different systems inside the same account as well as manage them and their billing. Microsoft solved those problems with a way to manage resources—Azure Resource Manager (ARM).

Azure Resource Manager is the engine that allows you to group resources together and create them (as a resource group) in a declarative way via ARM templates.