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Is Microsoft Dynamics Choking Your Growth?

CRM ERP Infrastructure Management NetSuite Reporting Strategy

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cloud computing Recently, I wrote an article “Are you starting to feel the QuickBooks pain with 15 or more employees?”.  I discussed that Quickbooks has software architecture limitations, and the way it was designed ultimately does not scale well when it has multiple users. When examining Microsoft Dynamics, we will notice that it does not suffer from these same kinds of limitations. It does, however, have its own set of drawbacks that may be choking your growth.

For those of you that may not know, Microsoft (MS) Dynamics is similar to Microsoft Office in that MS Dynamics is a suite of business application products.  In Microsoft Office, there is Word, Excel, Outlook, Powerpoint, Outlook.  Each of these programs have a distinct purpose and they interact pretty well together – but it’s not quite the same picture with MS Dynamics as you will soon see.

Essentially, Microsoft Dynamics is a marketing name for a bunch of business applications that include one CRM and and four (that we will focus on) ERP systems.  Only one, the CRM, was created from the ground up by Microsoft and is web based.

There are primarily four main Microsoft ERP packages that are offered in the United States:  GP (previously Great Plains Software), NAV (previously Navision), AX (previously Axapta), and SL (previously Solomon). These four business packages were purchased by Microsoft to make sure they own a foothold in the business software space.  Each one of these systems are a Windows package (problematic in an increasingly Apple oriented world).  Each system is targeted to serve different clients but there is a quite heavy overlap in features and capacities.

Each of these ERP packages have a long and solid history.  I have done a number of implementations of these packages and currently have clients running them.  I have close friends, that are experts at producing  integration between these packages and other systems.

But there are some limitations when compared to Cloud apps such as NetSuite. First and foremost, you have to buy equipment, server software, and labor to setup, maintain and manage the system. All of this requires business expenditure – and this is where you can see your growth inhibited.  All the money spent managing these processes, in my mind, can be much better used to grow your business.

Another weakness with these independent packages is that they all have their own reporting capacities.  If you have read some of my previous articles, especially “Best of Breed Business Systems, Traps & Lies”, you will know that integrated reporting makes for easier business planning. In Microsoft Dynamics, you will need to write your own reports to combine the data stored within the independent ERP and CRM systems.    And Microsoft offers yet another product to get to your data, the Management Reporter. Overall, you won’t get the best business intelligence because the information is stored in multiple locations. This is one of the strengths of fully integrated business management software, such as NetSuite.

Microsoft has developed its own Cloud offering. It is called Azure, which is a way to host these business apps to run in the Cloud. This will eliminate the need for hardware and server software. But there are still challenges, such as the need to establish and set up an Azure environment and make sure it functions properly.  That means you still better have an IT geek, like me and my team, nearby to help out.   Naturally, there are third parties that are available for hosting and set up.  But all of these processes have costs associated with them that can be avoided with the right architecture and offer; in essence, this approach means  you are outsourcing a segment of your IT; but not nearly enough of it.  For most businesses, there is little competitive value in managing all that software in the cloud.
cloud computingYour costs will be higher because the architecture of Dynamics is not multi-tenent.  It was meant to be its own unique instance.  A big drawback is that you will need to manually perform your own upgrades  – and if you don’t, you’ll get behind and possibly risk the need to do a new implementation; like putting in new software (I know no one that wants to do this) .  The benefit of software systems, such as NetSuite, is that the software is upgraded twice a year, is included in the contract, and you can’t get behind.

Bottom line: the key weakness of all the Microsoft Dynamics applications is that you need to make investments in places that do not add to your competitive advantages.  All the costs you put into getting and keeping the infrastructure up, and ensuring that the software stays current, could be used for more important revenue generating opportunities.  And this is how Microsoft Dynamics may be choking your growth.

Copyright © Marty Zigman 2011

Marty Zigman

Holding all three official certifications, Marty is regarded as the top NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 30 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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About Marty Zigman

Marty Zigman

Holding all three official certifications, Marty is regarded as the top NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 30 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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