Microsoft recently rebranded its business software offerings and the effect is largely positive though it must be emphasized that in performing the exercise, deck chairs moved though the cumulative effect remains to be seen. One of the effects is surely that the ERP and CRM solutions are now all offered online as the Dynamics 365 moniker implies.
Straight off, the re-branding takes Microsoft somewhat away from directly competing in CRM or ERP with the likes of Salesforce, Oracle, and SAP. But as a practical matter this hasn’t changed except that they can now absent themselves from some of the chest pounding these vendors have occasionally engaged in. The new bundling comes in two flavors—Business Edition with financials, sales, and marketing, and Enterprise Edition with operations, sales, marketing, customer service, field service, project service, something called power apps, and [work]flow.
This new packaging appears to be aimed at Salesforce because the other vendors Microsoft is likely to be compared with all have conventional ERP solutions as well. So with this move, Microsoft highlights the distinction between Salesforce and the rest of the industry.
But this only goes so far. As a practical matter Salesforce has the largest and most robust ecosystem in the business with a raft of ERP providers including Financial Force, IntAcct, Kenandy, and others like Sage, which offers a hybrid solution for small business. NetSuite is also well integrated with Salesforce and with Oracle so the rebranding might be most effective as an internal approach to streamlining offerings. It might also suggest the company sees good opportunity selling CRM to its ERP base and vice versa.
Regardless, the increased emphasis on AI and machine learning industry-wide may be more telling. The last few years have seen a quiet move from transaction orientation in business to more agile relationship building. To be effective at this you need two things. First, and most obviously, you need an integrated solution set that can easily share process data across a range of platforms including desktops, tablets, and hand-held devices. Second, the applications need to do some of the work identifying opportunities once left only to people.
For instance, apps that can understand email well enough to schedule an appointment, send information, or take a next step in a process are being highly prized for good reasons. All major vendors are making strides in this direction so Microsoft’s direction is congruent.
In an October 10 posting on his site, CRM Search, old friend Chuck Schaeffer observes,
At this point Dynamics 365 is little more than a change in branding, bundling and roadmap. Microsoft is making a [conscious] decision to do away with the ERP and CRM monikers in favor of business process labeling. While the messaging is understandable, the industry at large has tried multiple times over to do away with the three letter acronyms. Yet decades later we still identify these business applications as ERP, CRM, SCM, HCM, MRP, MEP and so on. Maybe this time will be different. But I doubt it.
It’s the idea of process that has my attention. We live in a process centric world and as I’ve written in my books vendors might want transactions but they’ve come around to the idea that transactions come at the end of well-designed processes. So we might want to still consider discrete blocks of functionality like ERP and CRM but at the end of the day, their value is directly proportional to the value they deliver to the customer.
And guess what? The game is about to change again from uni-dimensional process orientation to something more dynamic called Business Agility. Watch this space.