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Microsoft Dynamics AX ERP Return on Investment (ROI) validated by Forrester

March 31st, 2014 Sandeep Walia No comments

Forrester Research’s consulting division conducted a study on the Total Economic Impact of Microsoft Dynamics AX on organizations. The study conducted with 24 organizations validates a high ROI of 92% with Microsoft Dynamics AX deployments. According to Forrester, Microsoft Dynamics AX ERP reduces operations costs and increases business value. The study shows an average payback period of 21 months, average Net Present Value (NPV) of over US$ 3 Million and an Internal Rate of Return (IRR) of 53%. These are pretty astounding statistics for any ERP solution especially given that the study only took in to consideration benefits in the first 3 year. A higher time horizon (which is common for ERP projects) would show even better numbers since most successful ERP implementations pay at least over 5-7 years

Composite Organization Three-Year Risk-Adjusted ROI

ROI IRR Payback Period Total Benefits(PV) Total Costs (PV) Net Present Value
92% 53% 21 months $6,269,550 ($3,259,651) $3,009,899

Source: Forrester Research, Inc.

Key areas of benefits cited by Forrester are both quantifiable benefits and non-quantifiable benefits. The quantifiable benefits of replacing legacy applications with Microsoft Dynamics AX are summarized in the table below

Benefit Benefit Source Value

Increased business user productivity

Greater automation translates to higher efficiency and being able to do more with less people. Savings are typically in accounting, procurement, customer service, and logistics.

45 employees on average eliminated or not added with increased growth
US$ 5.8 million over 3 years

Reduced IT Team Size

Decreased team size due to easier manageability of the ERP application and a single application versus multiple legacy applications

US$ 2.2 million over 3 years
Year 1: Four fewer IT FTEs
Year 2: Six fewer IT FTEs
Year 3: Seven fewer IT FTEs

Eliminated systems license and maintenance cost

Microsoft Dynamics AX typically has one of the lowest software assurance costs of 16% in the ERP industry. That coupled with the fact that a Microsoft Dynamics AX implementation typically eliminates multiple legacy applications leads to ongoing continual savings every year.

US$ 1.1 million over 3 years
Average annual savings in software assurance cost of $360,000

Non-quantified benefits that are listed but not included in the analysis for the Total Economic Impact are

  • Improved business performance: Generally organization’s that used Microsoft Dynamics AX had overall performance improve with increased sales and profitability. This is achieved through faster responses to market changes and decreased internal costs. Personally, I think this should have been a quantifiable benefit as it is so significant and could nearly double the ROI and NPV value measurements.
  • Improved system reliability and uptime: Microsoft Dynamics AX exhibited better uptime and system reliability than the legacy systems replaced leading to less disruption in work and better operations for the organization.
  • Better decision making: By having a unified ERP system allowed users to get data more easily and make more informed decisions which improves business outcomes and reduces time. Increased business intelligence capabilities helped with time to market especially for global companies.

The summary of the business value which includes the total cost as well as the total quantified benefit is shown below. In total cost, Forrester included all of the following

  • Software license cost for Microsoft Dynamics AX
  • Annual Software assurance and maintenance cost
  • Professional services and consulting costs
  • Training costs
  • Internal FTE Labor cost
  • Hardware costs

summary of the business value

Source: Forrester Research, Inc.

If you would like to see how Ignify can help bring this value to your organization or see a demonstration of Microsoft Dynamics AX please email us at dynamics@ignify.com.

Sandeep Walia is the CEO of Ignify. Ignify is a technology provider of CRM, eCommerce and ERP, and Point of Sale software solutions to organizations. Ignify has won the worldwide Microsoft Partner of the Year Award in 2013, 2012 and 2011. Ignify has been included as the fastest growing business in North America for 7 years in a row by Deloitte, Inc Magazine and Entrepreneur Magazine from 2007 to 2013.

Avon Versus Revlon – A tale of two ERP Systems: SAP and Microsoft Dynamics AX

December 16th, 2013 Sandeep Walia No comments

Wall Street Journal reported that Avon pulled the plug on a $125Million SAP project after a Canadian pilot prompted sales reps to quit in frustration.

Avon began using the new order management software system in Canada in the second quarter. The SAP based system was so burdensome and disruptive to Avon representatives' daily routine that they left in meaningful numbers.  "In light of the potential risk of further disruption," Avon decided to halt the software's rollout to other countries, according to a filing with regulators Wednesday.  The company expects to write down between $100 million to $125 million of the cost of the software because it won't be put to use in the rest of the world.

Interestingly, Avon’s competitor – Revlon chose Microsoft Dynamics AX which in stark contrast is a success story! Revlon runs 50 different business entities and collapsing 21 separate ERP systems in to one.

Microsoft Dynamics AX is being used at Revlon to unite customers, unite business and IT, unite their people and act as one unified organization. David Giambruno, Senior VP and CIO of Revlon stated that there is a “no customization rule” within Revlon. So Microsoft Dynamics AX has been implemented with no customization. Revlon processes an average of 14,000 transactions in a second according to Anya Ciecierski, ERP Software Blog Editor. The base implementation and the first company took a year to go live. However the second country went live in 14 days and the third country in less than a day!

Why such a big difference in these two implementations? Why did Avon fail so miserably with SAP and Revlon succeed so spectacularly with Microsoft Dynamics AX. As Steve Rosenbush, Deputy editor at Wall Street Journal pointed out the failed implementation reflects the rise in importance of usability. Microsoft Dynamics AX is modern, intuitive, easy to use, flexible and agile as evidenced in the role center below. You can have the best system implemented but if users will not use it due to poor usability you will have failure.

Accounts Payable Coordinator Role Center

Microsoft Dynamics AX presents high usability ERP making it easy and intuitive for users to work with. The picture above is for an Accounts Payable Coordinator Role Center. Business Intelligence is not limited to just executives but available to operational users.

In addition Microsoft Dynamics AX is powerful evidenced by the fact that a company the size of Revlon could implement it with no customizations. There is deep capability for enterprise financials, supply chain management, inventory, warehousing, retail, merchandising, MRP, procurement, vendor management, customer management, HR and Payroll in Microsoft Dynamics AX.

If you’re looking at a new ERP system please email us at ERP@ignify.com

Sandeep Walia is the CEO of Ignify. Ignify is a technology provider of CRM, eCommerce and ERP, and Point of Sale software solutions to organizations. Ignify has won the worldwide Microsoft Partner of the Year Award in 2013, 2012 and 2011. Ignify has been included as the fastest growing business in North America for 7 years in a row by Deloitte, Inc Magazine and Entrepreneur Magazine from 2007 to 2013.

SalesLogix Vs Microsoft Dynamics CRM

October 1st, 2013 Sandeep Walia No comments

Microsoft Dynamics CRM Versus Saleslogix: Feature Comparison

A prospective customer asked us the difference between Microsoft Dynamics CRM and SalesLogix functionality so we’ve put this feature comparison between the two products.

 

SalesLogix

Microsoft Dynamics CRM

Marketing Automation
Static Marketing Lists
Dynamics Marketing Lists
Campaign Management (Traditional)
Campaign Activity Distribution to Record owners
Event Based Campaigns
Activity Feeds
Collaboration Framework
Email Marketing
Sales Force Automation
Contact Management
Customer Management
History
Lead Tracking
Lead Assignment to Sales Reps
De-Duplication (Lead to Lead, Lead to Customer)
Opportunity Management
Sales Stage Automation
Sales Quote Management
Sales Orders
Invoices
Sales Forecasting
Sales Goals
Automated Email Templates
Language Support
Chinese
Dutch
English
French
German
Italian
Japanese
Portuguese
Russian
Spanish
Swedish
Customer Service
Case Management
Knowledgebase
Service Calendar
Service Scheduling
Service Goals
Call Center
Collaboration
Dashboards
Dashboard Customization
Activity Feeds
Integration with Yammer
Integration with Outlook  2013
Mobile UI Only in v7.5.3
or higher
Offline Capability
Workflow Rules
Alerts and Notifications

Disclaimer: This document is put together by Ignify Inc based on its research and knowledge of Microsoft Dynamics CRM and SalesLogix

Sandeep Walia is the CEO of Ignify. Ignify is a technology provider of CRM, eCommerce and ERP, and Point of Sale software solutions to organizations. Ignify has won the worldwide Microsoft Partner of the Year Award in 2013, 2012 and 2011. Ignify has been included as the fastest growing business in North America for 7 years in a row by Deloitte, Inc Magazine and Entrepreneur Magazine from 2007 to 2013.

Microsoft Dynamics CRM 2013 – Summary of What’s New

August 9th, 2013 Sandeep Walia No comments

Microsoft Dynamics CRM 2013 is around the corner and will be generally available in Q4 2013. For those interested in what is coming, this blog article serves as a summary of the highlights of what is new in Microsoft Dynamics CRM 2013 – codenamed Orion. I will focus on the functional enhancements in this blog article, the architectural enhancements in a second blog, and then the licensing changes in a final blog article.

Microsoft Dynamics CRM 2013 Functionality Enhancements:

  1. Mobile Device and Touch-Optimized Screens:

A new user interface that is touch-optimized for tablets and mobile devices, with ability to swipe through forms and stages. Icons and fields are tailored for entry on a mobile device. For example, when I’m on the customer Fourth Coffee below, I don’t have to have a left navigation bar with hyperlinks for forms but can pull down a menu item to see all the related items, such as activities with the customer, documents uploaded for the customer, sales opportunities and customer service cases. As you will notice in the screen shot below – these are large size touch-optimized buttons that are easy to work with as compared to most applications in the market, which need the accuracy of a sniper to work with your mobile device.

Mobile Device and Touch-Optimized Screens

  1. Business Rules:

Business Rules

Configurable business rules in Microsoft Dynamics allow you to set business rules which, based on certain conditions, can have actions tied to them. For example, you can automatically populate other fields including calculated fields. These business rules work on the web forms, tablet/mobile applications, and the new quick create forms. They can be applied to a single form or to all forms for an entity. These business rules are solution aware, so they can be made part of a CRM solution. The solution architecture itself has been improved, and I’ll talk about that later in the blog article. The business rules also support labels for localization, and there is full SDK support through the workflow API.

These business rules can have processes, and each process can have constraints or steps that need to be completed before you move to the next stage

As an example – the screen shots below show a demo of a Biking event. We want to set a rule that if the bike type is Mountain, then a Waiver is required and additional information is captured – e.g., date waiver signed, etc. So we set up a Waiver rule, and if the Bike Type Equals Mountain, then the Action is that Waiver is Required.  The screen below depicts that.

design view of the Event form

The screen above shows the design view of the Event form, which has the fields Bike Type (dropdown with values = Mountain and Road) and the Waiver Type. Also notice the Business Rules Explorer on the right hand side that shows all of the Business Rules setup.

Waiver Rule setup with Microsoft Dynamics CRM 2013

Waiver Rule setup with Microsoft Dynamics CRM 2013 with Condition where Bike Type is Mountain, then an action will be taken.

Auto Action on the Business Rule

Auto Action on the Business Rule. The action here is that the Waiver Required field will automatically become Yes and will be locked so it will not be editable.

  1. Image/Photo support:

All entities including contacts, leads, accounts can have images tied to them, as in the example of Jim Glynn shown below.

Image/Photo support

  1. Quick Create Forms:

These are essentially forms that allow you to do quick actions when on a form – e.g., you can be on a customer and create a contact from there quickly. Or you can be in the sales area and click on create and create a lead, opportunity, account, activity very quickly. These forms are especially helpful to be able to enter data very quickly, as these are tailored to take the least amount of data required. You can of course select the fields needed.

Quick Create Forms

For example, if I received a phone call from a prospect that saw us at a Charity event for a donation we made and I just want to capture some basic information, I can do that on the Campaign response Quick Create form shown below. The field you want to capture on the Quick Create form can be configured, and as you’ll notice the only mandatory fields here are the subject and the campaign. Others are optional fields. This is especially useful when you are on a phone call or have to jot down a quick note, so instead of reaching out for a pen or paper, you can reach out to Microsoft Dynamics CRM.

Quick Create Forms

  1. Real-time workflows:

Real-time workflows

Microsoft Dynamics CRM 2013 introduces synchronous workflows which work on the same process framework – i.e., the same web designer as before. These work everywhere – i.e., web, mobile, or through the CRM SDK, allowing for the build once, use anywhere. These workflows are very powerful and are transaction aware. What does that mean? That means that all steps run within a single transaction. If something goes wrong there is full roll-back capability with the workflow.  In addition, these workflows support both pre- and post-pipeline stages. Simply stated, you can determine at what point the workflow kicks in – after or before an action happens.

Real-time workflows

In the workflow web designer screen, there are now options that allow you to specify the scope of the workflow – e.g., the organization or a business. Also, there is a Start When field which has a Before and After ‘Record is created’ or ‘Record is deleted.’ These workflows also have security enhancements in that these don’t need to now run under the security permissions of the owner of the workflow. You can have the option to run under the security privileges of the owner of the workflow, or the security privileges of the user who made changes to the record.  This helps significantly with security integrity and ensuring that the workflows’ security can be managed to the security permissions of the user that is triggering the workflow.

For example, in the screen shot here – the workflow I have is set to be run after the record changes and the scope to be the entire organization but to run with the security privilege of the user who changes the record.

To understand the power of the real-time workflow, here is an example in action. When a new lead is created and tied to an existing contact, the workflow will in real-time bring over the contact information for the lead and populate the lead screen. This would in Microsoft Dynamics CRM 2011 have required that the record be saved to trigger a workflow and then the record be reopened to see the information (which defeats the purpose). Alternatively, this could have been achieved in Microsoft Dynamics CRM 2011 with Java script, which requires programmer expertise. However, with the real-time workflow, no programming is requires as you can configure the workflow to run real-time immediately after the action is taken.

Step 1: Lead information is entered.

Lead information

Step 2: Real time workflow in Microsoft Dynamics CRM 2013 fills in details of the existing contact and account that is linked to the lead.

Real time workflow in Microsoft Dynamics CRM 2013

  1. Native Mobile Apps:

At the beginning of the blog, I talked about a mobile-optimized UI. This will allow you to use Microsoft Dynamics CRM 2013 from any tablet or phone device, including an Android, iOS or Windows mobile device. However, in addition to that, there are two apps for the Windows Surface devices and the iPad that will provide native apps for Microsoft Dynamics CRM 2013. As I understand, the plan is for these to be available at no additional cost if you have a user license.

Overall, Microsoft Dynamics CRM 2013 brings significant functional enhancements to the already powerful platform. If you are interested in evaluating Microsoft Dynamics CRM 2013 for your organization, please do not hesitate to write to us as crm@ignify.com. Watch out for our next blog on technical and architectural improvements in Microsoft Dynamics CRM 2013.

Disclaimer: This information is based on the beta version of Microsoft Dynamics CRM 2013 so things may change, though it is unlikely that any functionality listed above will not be in the final release. However, this is not an authoritative guide of what is new since the GA is not yet out. This article is based on personal research and does not reflect Microsoft or Ignify’s opinion.

Sandeep Walia is the CEO of Ignify. Ignify is a technology provider of CRM, eCommerce and ERP, software solutions to businesses and public sector organizations. Ignify has won the worldwide Microsoft Partner of the Year Award in 2013, 2012 and 2011. Ignify has been included as the fastest growing business in North America for 7 years in a row by Deloitte, Inc Magazine and Entrepreneur Magazine from 2007 to 2013.

Upgrading to Microsoft Dynamics AX 2012

July 22nd, 2013 Sandeep Walia No comments

Microsoft has made significant changes in the upgrade path for Microsoft Dynamics AX. This article will primarily focus on the upgrades for major versions – e.g., Microsoft Dynamics AX 4.0 and Microsoft Dynamics AX 2009 to Microsoft Dynamics AX 2012 or Microsoft Dynamics AX 2012 R2. It will not focus on the upgrade from Microsoft Dynamics AX 2012 to Microsoft Dynamics AX 2012 R2, which is a relatively straightforward and painless upgrade.

I’ll start by pointing out the obvious. If you are on Microsoft Dynamics AX 4.0 or Microsoft Dynamics AX 2009, don’t even consider going to the base version of Microsoft Dynamics AX 2012. You should go directly to Microsoft Dynamics AX 2012 R2 and the latest cumulative update. As of the date of writing this article that is CU6. So your target upgrade would be Microsoft Dynamics AX 2012 R2 CU6 or later. There is enough new functionality in Microsoft Dynamics AX 2012 R2 + architectural improvements (e.g., support for data partitioning is only available in Microsoft Dynamics AX 2012 R2) that if you are doing an upgrade you may as well go to the version that offers the highest return. 

To do the major version upgrade, the main change is that the upgrade is now a ‘Source to Target’ model versus an ‘In – Place’ upgrade. In simple terms, you need a new environment for the target production upgraded instance – hence the upgrade is called Source to Target.  Before you could just do an upgrade on the same environment, and hence called an In Place upgrade. Clearly there is one downside, which is that there is the additional cost of the new environment required for doing this. Without being entirely dismissive about that cost, I’d like to point out three things that make this not such a bad scenario:

  1. Hardware costs have constantly decreased over the years and new hardware virtualized or non-virtualized is going to be the least expensive item of an upgrade.
  2. Microsoft Dynamics AX 2012 has a significantly overhauled architecture. It provides significant flexibility and a lot of scale for high volume transactions but needs much more robust and scalable infrastructure than what prior versions required. So irrespective you will need to significantly update your hardware. Besides, if you implemented Dynamics AX 4 or Dynamics AX 2009, your hardware is likely to be at least 3 years old, which means it is likely fully depreciated or nearly fully depreciated and needs a refresh. This is the time to do it.
  3. There is a timing advantage of the Source to Target model, which can significantly reduce the downtime required in an upgrade. This is especially relevant for enterprise environments where there are high data volumes and where the pre-processing of data can take a significant amount of time.

Expanding on point 3 stated above a little bit more, I’ll illustrate the difference between the two upgrade paths. When you do an In Place upgrade, here is what your upgrade looks like. Notice the significant amount of down-time represented by the dark grey color.

Figure 1. In Place Upgrade for Microsoft Dynamics AX has more downtime.

Figure 1. In Place Upgrade for Microsoft Dynamics AX has more downtime.

On the other hand, when you do a Source to Target upgrade, you can pre-process your data online and parallel prepare your target system for the upgrade by doing the installations of SQL Server, Microsoft Dynamics AX Server, Help Server, and ensuring all permissions are correctly granted. What this does is significantly reduce the downtime required as most of the time of the upgrade the source production system is online.

Figure 2. The Source to Target Model for Microsoft Dynamics AX 2012 upgrades lowers the amount of downtime as the production system is online for most of the upgrade.

Figure 2. The Source to Target Model for Microsoft Dynamics AX 2012 upgrades lowers the amount of downtime as the production system is online for most of the upgrade.

Microsoft has made the upgrade process fairly streamlined despite the significant change in architecture. The most significant change in the architecture is the move towards a model store architecture, which allows high performance run time layer flattening. During the upgrade, the prior model (AOD) is upgraded to the Microsoft Dynamics AX 2012 model store architecture as shown in the diagram below.

As part of the upgrade to Microsoft Dynamics AX 2012, the older architecture is converted to the new model store architecture, which enables higher performance.

Figure 3. As part of the upgrade to Microsoft Dynamics AX 2012, the older architecture is converted to the new model store architecture, which enables higher performance.

Key to streamlining the upgrade process is a set of checklists that define the tasks required for an upgrade.

  1. Preprocessing upgrade checklist: Tasks that prepare data on the source system for export into the database schema of a Microsoft Dynamics AX 2012 R2.
  2. AOD code upgrade checklist: Tasks that are involved in migrating any customized code in legacy AOD files to the model architecture of a Microsoft Dynamics AX 2012 or later system.
  3. Model code upgrade checklist: Tasks that are involved in migrating any customized code in legacy models to the most recent Microsoft Dynamics AX release.
  4. Data upgrade checklist: Tasks that are involved in upgrading imported data on a Microsoft Dynamics AX 2012 or later target system.

Reporting changes: The old model of reporting in Microsoft Dynamics AX has been retired and all reports in Microsoft Dynamics AX 2012 are built on SQL Server reporting services (SSRS). This includes several benefits, including providing the ability to schedule reports with native SSRS capability as well as the ability to export all reports into Microsoft Excel, Word, XML etc.

For a more detailed discussion on your upgrade needs, please email us at dynamics@ignify.com and schedule a phone call with our Dynamics AX upgrade team.

Sandeep Walia is the Chief Executive Officer of Ignify. Ignify is a technology provider of ERP, POS, CRM, and eCommerce software solutions to mid-market and enterprise businesses and public sector organizations. Ignify is winner of the Microsoft Partner of the Year award in 2013, 2012 and 2011. Ignify offers Microsoft Dynamics AX, Dynamics AX for Retail POS and the Dynamics CRM solutions for organizations. Ignify has been included as the fastest growing business in North America for 6 years in a row by Deloitte, Inc Magazine and Entrepreneur Magazine and ranked as one of 100 most innovative companies in the world in the Red Herring Global 100 in 2011 and 2010. Sandeep was ranked in 2010, 2011, 2012 and 2013 in the Microsoft Dynamics Top 100 Most Influential People List by DynamicsWorld. Ignify has offices and team members in Southern California, Northern California, Arizona, Tennessee, Washington, Florida, Pennsylvania, Canada, Singapore, Malaysia, Hong Kong, India, and Philippines.