Dynamics 365 Finance & Operations provides amazing benefits to those looking to move to a modern, robust and scalable ERP solution without having to devote massive amounts of capital and resources to their IT departments. Running D365FO in the cloud allows companies to focus their resources on their core business functions and the business process reorganization that comes with a major system implementation or upgrade.
It also provides a rock solid enterprise systems infrastructure to all companies, big and small, that house their solution in Azure and manage it with Lifecycle Services. And, while not cheap, it allows companies to spread their systems costs over an extended timeline, freeing up valuable capital for business specific expenses.
That’s all great and a real selling point, but D365FO, like any other ERP, has strengths and weaknesses. ISVs like ours survive on identifying those weaknesses and developing functionality that not only fill the gaps left in the ERP’s capabilities but enhance the overall experience. In our case, it’s parcel and LTL shipping, but there are many others plugging holes and/or expanding on functionality that may not be as complete as desired.
When undertaking a traditional ERP implementation, companies have had to tightly manage the expense of adding additional functionality to an already resource intensive project. As with any cost/benefit or ROI analysis, adding ISV modules can seem daunting from both a time and cost perspective. Frequently, customers would turn to their ERP resellers to write customizations that would resolve the most pressing gaps at reduced time and expense.
Entering the D365FO paradigm shift
Both customers and resellers are discovering Microsoft has altered the traditional ERP implementation paradigm with Azure and Dynamics 365 Finance & Operations. By removing the need for massive capital expenditure and providing enterprise scale systems infrastructure for a subscription fee, they have minimized the significant capital and resource burden of an ERP implementation.
But it comes with a catch. Microsoft releases quarterly updates to D365FO and requires customers be no more than two releases behind at any given time. This all but removes the traditional use of customizations, especially extensive ones. In the past, a company with an extensively customized ERP solution could pick and choose updates or forego them altogether to avoid having to redevelop the customized code in order to conform to the updated ERP. This model is no longer an option in the Azure/D365 world.
AppSource – The App store for Dynamics 365
Part of Microsoft’s strategy for maintaining and updating their Azure/D365 cloud environments is to provide an enterprise level equivalent to the traditional App store. ISVs who wish to resell their solutions to the D365 community need to go through a Microsoft vetting and approval process in order to make their solutions available to D365 customers. Those ISVs are also required to keep their solutions current with the latest release of D365.
This provides D365FO customers with the peace of mind that any ISV solution they purchase from AppSource is designed to work with their solution and will continue to do so for as long as they use it. The ISV solution will go through the same implementation lifecycle as their core solution and follow the same processes through to production. These solutions are part of the subscription model and therefore provide the same capital and resource flexibility of D365FO.
Is customization dead in D365FO?
The simple answer is no. There will always be a need for a customer to make modifications to an ERP to meet their business needs. The trick will be identifying when and where these customizations should take place.
The advantage of an approved ISV solution is they will be maintained and updated as your environment is updated. They will provide you with additional functionality and improvements over their lifespan as part of your subscription fee.
The trick for any customer will be measuring the ongoing cost and impact of a customization against the added benefit. Customization scope will become critical for long-term system management. Once the scope of a customization gets beyond an acceptable maintenance expense, and ISV solution may provide better ongoing value.
Vice President Operations
NMB Solutions Canada Inc.