Industry Insights

Microsoft Combines CRM, ERP Products in 'Dynamics 365' Cloud

Microsoft today announced Dynamics 365 combined their CRM and ERP cloud offerings into one cloud service. The Dynamics 365 service will be integrated with Office 365, using a common data model with Microsoft's Office-in-the-cloud service. The new product brings together a group of Microsoft’ cloud apps for businesses in areas including financials, field service, sales, operations, marketing, project service automation, and customer service. 

“Microsoft is planning two basic options for Dynamics 365: "Business" for SMBs and "Enterprise" for larger deployments. For either option, the goal is to provide a solution that is focused on process and functional needs, not on purchasing a software suite”, said Microsoft General Manager Barb Edson.

"Microsoft is not just unifying but aggregating solutions so customers can purchase just what they need, as a singular business app," Edson stated in an interview and she elaborated why customers should expect to pay a single role-based price for each seat of Dynamics 365: "Dynamics 365 will behave much like Office 365 by offering a subscription price that covers all the needs of any particular person's role, from the core ERP or CRM functions to things like workflow, Power BI, mobility, PowerApps, and other components of the Cortana Intelligence Suite like Azure machine learning, IoT, and big data tools."

The combination of its sales and resource planning software in one suite has been announced five years after launching Office 365. The products, which will be available this fall, is designed to be tightly connected to Microsoft’s cloud version of Office. It means that sales representatives can draw on up-to-date pricing and discount data stored in Dynamics to send customers quotes without leaving Office’s Outlook e-mail program. 

Microsoft demoed one of its partners, AvePoint’s Citizen Services app. The company is using Dynamics 365 to develop a system which can help cities quickly learn about and fix infrastructure issues.  For instance, when a citizen reports a broken streetlight, a city employee will submit the problem in the CRM app, which will proceed an inventory request for a replacement part in the ERP app. As a result, a technician will be automatically scheduled to repair the light. The software can also measure response times if needed. 

Purpose-built apps developed as part of Dynamics 365 will manage specific business functions as mentioned above. Mike Ehrenberg, Microsoft Technical Fellow and Leader of Dynamics R&D elaborated how these capabilities will be based on existing capabilities of Dynamics AX and CRM, as well as Project Madeira, which is the cloud ERP system for SMBs: “The Dynamics 365 approach will be driven primarily by re-packaging and, to an extent, re-architecting, the capabilities of Dynamics CRM, AX, and Project Madeira,” he said. “This alternate approach will require new deployment and data management capabilities. We understand Dynamics 365 is something that makes a ton of sense for customers but only with product truth behind it," he explained.

Dynamics 365 should make Microsoft’s offerings less confusing to customers, says Rebecca Wettemann, an Analyst at Nucleus Research, who was pre-briefed on the product. “This is another example of [CEO] Satya [Nadella]‘s influence on Microsoft and the company’s sharper focus on bringing the combined power of the Microsoft portfolio to bear,” she says. The new offering “is likely to accelerate Microsoft’s consistent growth” in CRM market share, Wettemann predicted. May figures from Gartner demonstrates Microsoft trailing in that market with a 4.3 percent 2015 market share, compared with Oracle’s 7.8 percent, SAP’s 10.2 percent, and Salesforce’s 19.7 percent.

Since Nadella was appointed as CEO in February 2014, Microsoft has been leveraging its enterprise and cloud offerings. As CMS-Connected reported last month, Microsoft also acquired LinkedIn Corp. in an all-cash transaction for a jaw-dropping price of $26.2 billion,  beating out a bid from its rival Inc., in an effort of boosting its Dynamics product. On this note, Scott Liewehr, co-host of the CMS-Connected Show and CEO & Co-founder of Digital Clarity Group , gave us his in-depth insight on the Microsoft Acquisition of LinkedIn in the CMS Insider segment


Microsoft Unveils AppSource

Microsoft also introduced today a new business service and application finder called AppSource. AppSource is a site where users will be able to find and test line-of-business software-as-a-service apps from Microsoft and its partners. Initially, AppSource includes more than 200 business SaaS apps, add-ins, and content packs, according to Microsoft officials. According to Microsoft, the purpose of AppSource is to allow anyone, from any sector or industry, to quickly discover and compare the tools they need for business.

AppSource is Microsoft’s listing for cloud-based apps that enterprises can use with Office 365, Azure, Power BI, and Dynamics. These third party apps can be added to Microsoft’s cloud services to customize or enhance functionality. Businesses can also try out apps before they commit to anything.

AppSource enables users to scan apps by category, such as collaboration, analytics, and marketing, or by what industry they are in or specifically which Microsoft product they want to add apps to. AppSource is available as of today. 

By connecting CRM data with enterprise resource planning (ERP) data in an integral way, Microsoft expects to differentiate from its CRM rivals like Oracle Corp., SAP SE and Salesforce which sometimes plays partner and sometimes rival. The recent updates including these two enhancements demonstrate that Microsoft has been working hard on more robust cloud offerings and platform for businesses where they can, ultimately, run every aspect of their businesses. 

The announcement of the integration with Office 365 is defined by some partners as long on features and benefits and short on technical detail. However, Microsoft officials plan to share more information about Dynamics 365 at next week's Worldwide Partner Conference in Toronto. We will shed light on what it means for Microsoft's existing stakeholders and prospects more in subsequent posts as events unfold. Meanwhile, we would love to hear from you in the comment segment below whether Dynamics 365 and AppSource will help Microsoft expand its cloud offerings for businesses.


Venus Tamturk

Venus Tamturk

Venus is the Media Reporter for CMS-Connected, with one of her tasks to write thorough articles by creating the most up-to-date and engaging content using B2B digital marketing. She enjoys increasing brand equity and conversion through the strategic use of social media channels and integrated media marketing plans.

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