By: James Croweler
Microsoft have revealed more details of their Dynamics 365 licencing to partners this week. A huge 173 page presentation gave us all a lot to think about as we try to understand the future and how it will affect our prospects and customers.
One obvious conclusion from it all is that the ‘Enterprise’ plans are a lot more well developed than the SMB focused ‘Business’ ones at this point. My other conclusion is that the Business edition will need to evolve considerably to be a success.
With Enterprise, at least on the slides you know that the applications listed such as Field Service and Project Service are there and available. Even Operations in the form of Dynamics AX 7 has come a long way down the road by reaching general availability this year. Yes, I know the integration story still has a way to go and that PowerApps and certainly the Common Data Model are not there as Microsoft would like them yet. But at least a company in the market today could look at what is there, understand what it will be, and start to plan around it.
In the SMB space though the plan is much more confusing. There are slides showing sales and marketing apps which are coming next spring and apparently are based on a ‘simplified’ version of Dynamics CRM. There is something described as ‘Financials’ which is the released version of Project Madeira, itself a simplified version of Dynamics NAV. And that’s it apparently, apart from the surround applications such as Power BI, PowerApps, Microsoft Flow, etc.
And Microsoft’s description of Business is that it is aimed at companies with between 10 and 250 employees, so we are not talking micro businesses here. These are businesses that are looking to upgrade from QuickBooks, Sage 50, and the like according to the Dynamics SMB management team.
So let’s not make the mistake of thinking this target market’s needs or wants are at a much simpler level than enterprises’. In fact, in my experience SMBs find it easier to adapt to more complex and sophisticated elements. The lower number of people at both decision making and user levels mean the change management and education required is so much lower. They can evaluate, make a decision, and start on the project in a morning. They walk into the MD’s office, and if it’s a good idea, then they walk out with authority to get it done. Try that in a corporate environment.
When I look at the systems in some of the FTSE100 clients we have, they are light years behind a whole host of our mid-market clients and they show no sign of catching up. In our case the software and therefore the capability is the same but the size of the enterprise companies means they just cannot adapt it quickly enough.
The ambition at SMB level is if anything, higher than your multinational. They don’t have the budgets or the people but they know the adaption of right technology means they will be able to spend more time with their family; in the enterprise the decision usually affects someone else. That makes SMBs more demanding and passionate because it affects them personally in a way that a group IT team, just won’t get.
So Microsoft need to make sure that they don’t miss the target with the Dynamics 365 Business Edition, and I’ll use a few examples to highlight how they might if a few of their stated plans become reality.
The Business edition financials is a simplified version of Dynamics NAV and one of the features that has been cut so far is inventory locations. In my experience, knowing the location of inventory is the most common reason for upgrading from Sage 50. If D365BE doesn’t have that, growing SMBs will have to move on to something else. It may seem counterintuitive that a sophisticated function like this is valuable to SMBs, but if anything, it is more important for an SMB to carefully control inventory. After all, they are facing tighter cash flow, lower liquidity, and worse credit terms than Enterprise-scale businesses.
Similarly, in Dynamics CRM they have apps pencilled in for sales and marketing but not service. Having implemented a lot of CRM in the SMB sector since 2005, I know that using cases for queries, helpdesks, or even complaints is as popular as using opportunities is for sales. If fact, I’d go further and say that SMBs that start using Cases are very sticky as CRM customers. When the sales manager changes or the business takes a downturn cutting sales lead CRM or changing to a different system that the new individual prefers is not uncommon in SMB. Once cases are established across the organisation and even through to their customer base however, that system is critical and beyond question.
Don’t misunderstand me, simplicity is important and SMB are not renowned for their patience. That makes me surprised that there is a Marketing app in Business Edition. I would expect that only one in twenty SMBs perseveres with Dynamics CRM’s marketing functions. They don’t have TV campaigns and mass market print ad buys to monitor, so Dynamics Marketing is complete overkill. They do want to create quick email and social media campaigns though, so we frequently use add-ons from the likes of ClickDimensions or Commigator. Sometimes it is as simple as linking their existing MailChimp account to update CRM for unsubscribes. Not standard CRM then, we need to go to a third party to get what they need.
When it comes to bringing Dynamics 365 Business edition to market, the pricing and margins are only one consideration. Unless the core product does what the market expects, it is going to be irrelevant. SMBs qualify on price in the first meeting to make sure it is affordable, then switch to finding which product will do the most for their particular business. Once they have identified that product, they will keep haggling to get the best price, but will almost never switch products during that haggle as they know from experience what having the wrong system will cost them.
So please, Microsoft, put a bit more thought into SMBs beyond price points and don’t just write them off as if anything simple will do.