More Than an ERP | Integrated Microsoft Solutions

Integrated Microsoft solutions allow businesses to improve performance and productivity on a daily basis. This blog and video will discuss a high-level overview of how you can get more out of an ERP than you have in the past. We’ll discuss the Cloud as it’s the facilitator for many of the advancements in the modern-day ERP, an overview of the Dynamics family of products, how the Power Platform plays a role in extending the functionality of the ERP to a broader user community, and how applications within the Office family facilitate a better overall experience within your ERP for your entire organization.

Technical Intensity

Technical intensity is something that Microsoft has been talking about since the onset of the pandemic and they have incorporated their definition of tech intensity into the development efforts for their products. My summarized definition of technical intensity is that it’s an indicator of a business’s capacity to innovate with technology and in return that technology’s ability to facilitate and support the innovations that those customers come out with. This concept became very prevalent with the onset of COVID-19 pandemic.

Within our customer base we saw two types of clients and how they engaged under this technical intensity concept. The first type spent their time transitioning their technology from being on-premises to being remote, so that they could facilitate working from home and all their effort went into the shift from office to home. The second group had already made that initial investment in the Cloud, and the transition from working in an office to working from home was as seamless as adding some additional licenses and they were able to, for the most part, not skip a beat and continue to work.

Clients that already had a higher degree of technical intensity were able to focus on how they could potentially shift their business model to survive during the pandemic. Those organizations were doing things like changing the nature of what they were manufacturing to align with the demand that the pandemic created. They were able to have their systems shift to support that new business model entirely, versus other clients that were looking at lifting and moving their on-premises technologies into the Cloud.

Cloud ERP

The Cloud is the facilitator for a lot of these benefits that we get in the modern-day ERP, but not all clouds or cloud ERPs were created equal.

When it comes to ERP, historically clients would choose their ERP based on the features and functions available and how they best aligned with their needs. The ERP market is very mature as far as software is concerned, so the gap between one application and another has largely been bridged. In other words, most mid-market and even enterprise ERPs are going to be similar in terms of all the feature functions within them.

An organization assessing ERPs from that context is not going to be able to find many differentiation points. There might be some differences for industry-specific ERPs, but those applications tend to be very fixed in terms of what they focus on and thus cannot adapt to new lines of business. We don’t see a lot of those industry-specific ERPs playing a role or being intense competitors as compared to some of the solutions that are more broadly focused.

If we section off the ERP market space in terms of the Cloud, we get four different sections:

Hosted ERP System

A hosted ERP system is outside of the cloud graphic above because it is not cloud-enabled and we’re just facilitating the underlying infrastructure. We’re installing the on-premise application to a cloud infrastructure, but we’re still doing the low-level activities like upgrades and applying patches and the client is still on the hook for those costs. In a hosted ERP system, there are two costs that are mutually exclusive, an ERP cost and a hosting cost. The one benefit in this scenario is getting remote accessibility.

Tenanted Cloud

With a tenanted cloud, the ERP providers largely deliver their software-as-a-service to the marketplace, so the cost of that infrastructure is in effect embedded within their software. This means that they are renting space on someone else’s cloud which may be Azure, AWS, or another cloud. The ERP provider can do a little bit of work to integrate with the Cloud to the benefit of the customer, but they don’t own the Cloud they’re renting space on, so they are in less control of taking advantage of all the Cloud has to offer.

Embedded Version

An embedded version in this case means that the ERP provider would also own all the Cloud infrastructure that sits behind it, so they do have the ability to get a lot out of cloud computing. There are very few providers of this type and they are different from the universal cloud providers because they don’t have the breadth of additional applications that also live on that same cloud.

Universal Model

The ultimate model is the universal model, which is what this blog article will focus on. In this model there is only one vendor, which is Microsoft, but in effect they own not just the ERP and infrastructure of the Cloud, but also all the other related applications that users use on a day-to-day basis. With the ownership of all those technologies, they have the best chance of delivering the most value by tying them all together for the benefit of the customer. This is where there is a unique differentiation point from other ERPs. Not only is it about feature and function, but about lighting up all of the other technologies to provide the best overall solution to the customer in the end.

Unlocking and Accelerating the ERP

Azure is Microsoft’s cloud platform and is what these ERP applications sit on. Inherently, that provides global access for organizations to access their solutions from pretty much anywhere in the world while at the same time meeting some often-stringent requirements around data sovereignty. For businesses that are in the United States or Canada and have a requirement to keep their data on servers that are inside the borders, that is available. In addition, there is world-class security embedded within that Azure layer, which makes it a lot more secure than through an on-premise solution.

We found that a number of our clients that were holding onto those on-premise servers had a change of heart when they were victims of either ransomware or cyber-attacks. In many cases, being a victim of a cyber-attack facilitated a shift to the Cloud where those customers now feel more secure.

When required, we can drop to a hybrid cloud or even on-premise. We do not recommend this option unless there’s a really good reason to do it, but it is an option that Microsoft provides. This option does limit some of the cloud functionality that will be discussed later.

The battle for ERP is not really being won within features and functions, but Microsoft does pay attention to features and functions and innovates its own applications by providing new functionality within their ERP offerings. Microsoft also relies heavily on partners like Encore and the thousands of others, to identify gaps within their applications and build apps to facilitate those features and functions. When we look at how Microsoft stacks up compared to competitors in spots where there’s a traditional gap within the core ERP, the gap has often already been filled or met through free add-ons or apps from AppSource. This is also where you see partners take very industry-specific approaches to meeting ERP requirements. It is a way in which you get the best of both worlds in terms of that functionality.

Dynamics 365 Framework

The Microsoft Dynamics 365 framework has many components, which includes both ERP and CRM systems. Within Dynamics 365, Microsoft delivers two ERPs; Dynamics 365 Business Central rightsized for small and medium businesses and then there is Dynamics 365 Finance and Dynamics 365 Supply Chain.

The ERP focuses on delivering largely transactional functionality to facilitate financials, sales order processing, purchase order processing, inventory manufacturing, project accounting, and it does not pretend to be a true customer relationship management system or a sales automation system. Dynamics 365 Sales would largely accommodate that gap and would manage your accounts, contacts, leads, opportunities, communications and correspondences with customers. It handles the methodologies and facilitates tasks that streamlines your sales processes.

While the transactions related to doing work in the field live within the ERP, the non-transactional work that happens in the field for things like dispatching, mobility, basically putting the technology as close to where the work is being done as possible, is largely what the Dynamics 365 Field Service application helps our clients achieve.

Dynamics 365 Customer Service is around building cases that your clients, partners, or the market issue with you, and your ability to run them through to satisfaction so that your customers are ultimately as happy as possible. It is another non-transactional application that really helps facilitate a lot of business processes outside the ERP.

Dynamics 365 Project Operations, much like Field Service, handles that scheduling the critical path, task management, and camp charting, just to name a few. High mobility concept to put the technology as close to where the work is being done in the field. Expansion management and time tracking are big pieces of what that application can provide within the overall Dynamics 365 framework.

People are at the core of almost every business, so Dynamics 365 Human Resources is a big component of the Dynamics 365 offering. Dynamics 365 Marketing is used largely to generate leads and opportunities, better align sales and marketing departments for efficiency of acquiring new business. Dynamics 365 Commerce is the e-commerce gateway to doing business with customers online, either B2C or B2B.

Some of the applications mentioned above are larger in nature. No one client of ours has all these applications. Some of our more complex clients might have three to four, but you pick and choose the functional areas required for your business and then you deploy those applications to suit your unique business requirements. Where there is a gap within these applications, we tend to fill that with either custom reporting type solutions on top of Power BI, workflow with Power Automate, or custom apps in Power Apps.

In the future, Microsoft is working towards the concept of everything living on the Common Data Service (CDS). The CDS ties all these applications together, to try to minimize the integration and best share data across applications while still maintaining data governance. It is still an evolving technology that in future state, will lead to a lot of benefits within the full Dynamics 365 framework.

Data Cycle with Power BI and AI Builder

Power BI

With Power BI, users can create reports for themselves and then it can be embedded back within the ERP reports. This means that organizations can learn one report writing tool, regardless of how many applications they have, and yet still create those reports and deliver them within the context of the ERP. It can even get to the point where it’s context-sensitive, where the record that you’re looking at can reference a Power BI report while being within the ERP system.

Power BI lives both inside and outside of your ERP system, therefore it can accommodate multiple data sources. That means through the Power BI mechanism, you can marry data from multiple data sources, but still view it within the ERP. Most ERP applications will not be able to facilitate that type of visibility into other application’s data without performing some intensive data migrations to get there, which then gets you into some trouble with replicating data across multiple systems.

With Power BI’s capabilities, we can drastically cut down how many integrations we build and we’re able to use this same type of functionality to minimize how much data we migrate when implementing a new ERP system. Instead of bringing over a bunch of transactional data, we’re able to reference the transactional data through Power BI but do it through the lens of the ERP system, which is a really interesting concept. These concepts have been around for a little while as Power BI has been around for a few years, but BI is in many respects looking backwards.

AI Builder

Looking forwards is the concept of overlying artificial intelligence (AI) on top of that data to be able to be predictive in terms of whether a customer is going to pay or how much inventory you’re going to have for a particular item. We can also use that to learn and create apps or chatbots and thus improving the experience that either users or consumers will get out of the data that you’re building up within your ERP system.

Power Automate and Power Apps

Power Automate

The main purpose of Power Automate is as a workflow engine, but it’s also an application connection tool that looks to streamline and make efficient processes, especially processes that cross-applications. At its core it does workflow, you can initiate those workflows within Dynamics, say for a purchase order or for a sales order to get approved, that can then let Dynamics go through its routing that lives outside of the ERP system, touch several users that also live outside of the ERP system before it comes back with an indication that a purchase order has been approved.

You can do some other interesting things with Power Automate, given that it has hundreds of connectors to other applications, including social. For example, you can tap into monitor changes to LinkedIn that automatically keep your customer database up to date without you having to do any data entry. Things that really look to keep data up to date, but also not have individuals spend a lot of time updating that data or replicating data in that case between LinkedIn and Dynamics. There are many different use cases for that. Out of the box, Dynamics has about 14 pre-built flows, but you can pretty much do anything you want with it.

Power Apps

Power Apps is a no code or low code rapid development environment targeted at building out and automating processes while keeping them tied to that core business application like the ERP. We look to Power Apps to automate what we would call more casual processes and non-transactional processes that are unique to your organization. Because it’s low code, no code it is also often available for customers to be able to create their own applications without a lot of interference or dependency on partners like Encore to provide it.

Office 365 and Microsoft 365

The applications within the Office family of products impact the experience our ERP customers have. There are quite a few Office products that Dynamics touches, but the ones that seem to be the most used are Excel, Outlook, Teams, and Word. Please note that in 2020, Office 365 Business plans were renamed to Microsoft 365.

Excel has always been around as far as an export/import tool, but where it goes to that next level is its ability to do things like modeling out a journal entry and then cut and pasting that journal entry back into the ERP system versus what we would have had to do and what other ERP applications have to do, which is build an integration or a data migration tool to move that type of thing back and forth. We also have this concept of editing within Excel that allows you to export filtered lists from anywhere within the ERP system and, in effect, do large changes based on that unstructured world of Excel. For example, this means you can add in a 10% increase in your price list for your items, and then en masse add that back into the ERP system. While using the edit in Excel feature, it does things like validates the data that’s going back in, so you’re not writing to tables behind the scenes, you’re going through the logic layer to ensure that your data is good.

In many cases, emails with customers are tied to individuals that are set up within your ERP system. Within the Outlook framework, users can look up data from the email without ever having to leave the email. It can also go a step further by updating information. To start a new sales order, you enter a new purchase order or update existing ones without ever leaving the email itself, which provides a lot of efficiency.

Teams is relatively new to the family compared to the others, but we’re already starting to see how you can embed and link records from the ERP system directly into Teams. Users can even see inventory items and their quantities within a particular Team site.

These are just some high-level examples as to how you can use all of the other Microsoft tools within its product families in order to really facilitate a compared to none solution.

A Microsoft Dynamics solution is more than an ERP. The Cloud is the facilitator in providing a modern-day ERP solution and having it delivered through the universal model gives the customer the biggest benefit. With one vendor providing the ERP, infrastructure of the cloud, and the other related applications, there is a lot of value to our customers having them all tie in together.

Contact us if you have any questions about the Dynamics 365 framework or other Microsoft technologies and solutions.

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