Dynamics 365 for Financials

There’s been a lot of buzz lately in business software circles about the latest offering from Microsoft, Dynamics 365. Between all the hubbub and marketing ballyhoo, however, it can be difficult to assess what is essential information and what is mostly “fluff.” I recently had the opportunity to attend a Microsoft-led training course in New York that went into great depth on the new product, and with that in mind, I wanted to offer a brief summary of my impressions and lessons learned from having spoken to Microsoft themselves as well as members of the Partner Network in attendance.

Before going on, it’s important to define a few terms. Fundamental to any understanding of Dynamics 365 is the fact that “Dynamics 365” actually covers a broad spectrum of software. Below is a brief summation:

  • Dynamics 365 for Operations (formerly Dynamics AX – this is the Enterprise solution)
  • Dynamics 365 for Sales (formerly Dynamics CRM – the Customer Relationship solution)
  • Dynamics 365 for Financials (A new SMB accounting solution in the cloud – the main subject of this article. Also known as Dynamics 365 Business Edition.)

(More in-depth information on the treatment of the above.)

Dynamics 365 for Financials was initially released as the go-to SaaS (Software as a Service) ERP for small- to mid-sized businesses. At launch, it looked very similar to Project Madeira (the beta version), with few major changes. Now, five months later, the Microsoft Partners have had a chance to experiment with and even implement Dynamics 365 for Financials. The burning question many people are now asking is whether this is a mature program and how it can be implemented in a manner that is efficient and cost-effective for both customer and partner.Contoso

Because the backbone of Dynamics 365 is based in Dynamics NAV, users who have had some level of experience with NAV will find a familiar look-and-feel to the new software. Even those who have never heard of NAV, however, would find that the user interface is not difficult to learn. Ease-of-use was one of Microsoft’s goals for this project, and although certain features may require specific training, on the whole, the program is not hard to navigate and learn from Day One.  It’s clean and straightforward and has a handy search feature from the homepage that can help you find the exact window you need. There’s also a mobile app accessible from either phone or tablet. The app has a very similar look and feel that allows you to seamlessly transfer from working on a laptop/desktop onto a mobile device with very little difference visually. Microsoft has gone to great length to make this a smooth experience for users.

Perhaps the greatest advantage to Dynamics 365 is its seamless integration with the Office products we all know and love. One of my favorite things about the product is the ability to send a quote, convert it to an invoice, and view the customer’s balance directly from your Outlook Inbox. Dynamics 365 Financials has a useful plugin that allows a user to access the relevant features of Dynamics 365 without ever leaving the Inbox:inbox

You can also seamlessly download and edit all of the standard reports and lists into Microsoft Excel with the click of a button. Note, however, that this does not write back to the database – it only edits the information that has been downloaded into Excel.

The program also has some functionality around the Cortana Intelligence Suite. For instance, if you’re looking at the current inventory and you determine that you need to order more of Widget X from Vendor Y when you open a purchase order, the Cortana capabilities can automatically predict that you are also low on Widget Z that this vendor also supplies. You’ll get a message that asks if you’d like to automatically add a line to the order for this product, and with the click of a button, your order just became that much more efficient. For an organization that doesn’t have the resources to devote a full-time position to procurement, this could be a lifesaver. One of the worst things that can happen to a small business is to receive a number of orders for a product only to find that they don’t have the necessary inventory to fulfill.

There are, however, some shortcomings to the product that are still present after five months of general availability. Unfortunately, some rather basic accounting needs are as of yet not possible. For instance, Bill of Materials and Kits are slated for a future release later this year, but until then users who need these capabilities will have to either find a custom app in the PowerApps store or request their Microsoft Partner to build something suited to their needs. The same is true for intercompany and company consolidation functionality, which are also slated for release in later 2017. Another example would be the ability to create recurring invoices, which as of yet does not appear to be possible in D365, although one can hope for a future release.

It appears that Microsoft is cautious about what they do and don’t release for the product. From speaking to the MS presenters at the training, they want to be careful that they don’t simply recreate Dynamics NAV under a different name, which is why they’ve been emphasizing a lean and clean version of the software. The obvious pitfall here is that features one would expect as a matter, of course, are not always there, and they are relying on the partners and customers to point out what these features are.

The good news here is that Microsoft appears to be eager to receive customer feedback on their product. They understand that it can improve from where it is, and to that end, they’ve allowed customers and partners to make suggestions to improve the product according to the functionality they require. Here is a link to the product roadmap containing the top requested features and a schedule of what’s currently in development.

One place where I can see Dynamics 365 as a great go-to solution would be for an organization that currently outsources their accounting and is looking at bringing it in-house. Perhaps they have between 1-10 employees or so, and they would like greater control over the financial aspects of their business. An example of this might be a small dentist’s office with a few employees. The Dynamics 365 for Financials would likely be a good fit, as a dentist’s office is unlikely to need the same deeply detailed account functionality as, say, a mid-level electronics manufacturer who might benefit better from a GP or Dynamics 365 Operations implementation. The cost at this level is also an attractive point – for $40 per user per month, it’s one of the better deals out there. There’s also the option to purchase limited “Team” users for $10 per month.

So, where does this leave Joe Partner or Joe Client who is wondering if this is a worthwhile investment for their business? At the risk of oversimplifying, the product excels when it comes to integration with existing Office products such as Outlook, Excel, and Word. This is probably its strongest selling point, along with the price. As a cloud-based program, it also has the advantage of seamless updates and high availability. However, the product still has serious drawbacks when it comes to functionality beyond basic accounting. A client with requirements that go beyond basic GL/AR/AP/Inventory may wish to consider a solution such as Dynamics SL or GP or possibly Dynamic 365 for Operations, depending on company size. Although the system can be customized to a degree with PowerApps, Microsoft does not expose the tables directly, limiting what can be done.

I believe that as the product is fleshed out in the months to come, we’ll see greater flexibility in adapting it to unique customer situations. Even as it stands, Dynamics 365 for Financials still has quite a bit to offer, especially if you don’t have a need for in-depth accounting functionality and are looking for a simpler interface. I’m always happy to set up a call to discuss specific details – you can email me directly at [email url=”jnorberg@ktlsolutions.com” class=””] jnorberg@ktlsolutions.com[/email].

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