Can Dynamics 365 Business Central Break Through Partner Channel Silos?

Microsoft's goal to offer customers in the SMB market a unified cloud platform for "digital transformation" is one step closer to reality with the release of Dynamics 365 Business Central, planned for April 2.

But the nagging problem -- having enough partners to deliver the full package -- remains. Microsoft needs more partners to get comfortable selling its Dynamics ERP and CRM products.

From the beginning of his CEO tenure, Satya Nadella has been trying to break down the silos within Microsoft and the partner channel. He understood the potential of Dynamics, the solutions group he once led, and the need to appeal to a broader set of resellers. The Dynamics solutions seem to have finally been incorporated into the overall product vision, but they are still not fully embraced by the vast majority of partners.

Dynamics 365 Business Central is a native cloud business management solution, based on Dynamics NAV functionality (previously code-named "Tenerife"), targeting small and midsize organizations. Microsoft's messaging appears to be directed at partners as much as customers: "Business Central offers terrific value because it integrates with other Microsoft cloud services including Office 365 and can be customized or extended for specific industry needs with PowerApps, Microsoft Flow and Power BI." Can this latest iteration of Dynamics finally convince Office 365 partners, MSPs and Cloud Solution Providers (CSPs) to dip their toes in the ERP and CRM waters?

"Microsoft's Dynamics 365 Business Central is an improvement from two points of view. First, for small and medium businesses using Office 365, it's a natural extension of everything they do from a productivity standpoint and extend that into a more financial ERP functional plane," said AJ Ansari, NAV product manager at Columbus Global. "Microsoft is making a strong statement about an end-to-end play for small to medium businesses. From productivity apps, to accounting apps, to resource planning, and managing of sales purchasing, et cetera."

"The second perspective is that Microsoft is just firing a shot across the bow for all the other competitors in the small and medium business space that have long knocked them for not having a true SaaS player in the SMB area," added Ansari, a Microsoft Dynamics MVP. "I think that this has been something that's been a constant message from folks like NetSuite and Intacct. Now, Microsoft can say our best SMB offering is a true SaaS offering."

To make it easier for a broader group of Microsoft partners to feel comfortable supporting Dynamics 365 Business Central, Microsoft has made a number of technical changes. "Traditionally, you would have to know Dynamics 365 or know how to develop within a product like NAV or GP to extend, but what Microsoft is doing in focusing more on APIs, which are going to be a central point in this Dynamics 365 Business Central," said Ansari. "And they're also focusing on tools like PowerApps and Flow, which leverage the Common Data Service. These are some of the tools that pretty much any type of Microsoft partner can understand and leverage to extend the capabilities of their value-added offerings. Gone are the days you would have to know something that was proprietary and unique to this application."

The hesitancy of Office 365 partners, CSPs and other partners usually stems back to a lack of expertise in the complexities of the accounting, supply chain and production functions. Partnering with traditional Dynamics partners has been a go-to strategy for those partners not ready to fully invest in hiring and training to support a new product line.

"Partnering to support Dynamics has really been a two-sided play. The partners that are good at the CSP model and fully understand how to go to market, they're focused on selling. They can pair with organizations who are specialists in implementing but are just not equipped to sell a SaaS product and do not fully understand how to leverage their CSP sales competencies," said Ansari. "Microsoft partner organizations, like IAMCP [International Association of Microsoft Channel Partners], are a great place to find and align yourself with complementary peers."

Ansari also sees room for improvement in Microsoft's current approach to helping net-new Dynamics partners get started. "I think one of the challenges is there wasn't enough documentation focused on partners new to Dynamics. If you were a traditional Dynamics partner, you probably had the greatest advantage because you understood the base product. But the depth of information available for a partner was no different than the depth of information publicly available for our customer," said Ansari. "So, to Microsoft, obviously, my recommendation would be that they focus on deeper partner-centric and partner-specific documentation around this to really help new partners catch on."

Having been in the Dynamics space for more than a decade, Ansari is more optimistic about the future of the product than ever before. "I think you truly now have everything that is needed by an SMB organization. It addresses needs for financials to operational requirements, like selling, purchasing, and inventory management of warehousing and manufacturing," said Ansari. "It's priced very competitively and will do well in that respect, as well. I am extremely encouraged, extremely optimistic about what lies ahead."

One measure of Microsoft's interest in bringing more partners onboard for Dynamics will be how it positions Dynamics 365 Business Central at its Build and Inspire conferences later this year. At last year's Inspire, the focus seemed to be on a partner-to-partner-driven strategy rather than attracting net-new partners. But to reach the masses, building toward numbers like Office 365, Microsoft needs to convince a lot of partners to jump into Dynamics with both feet.

How are you going to add Dynamics 365 Business Central to your Office 365 offering? Send me a note and let's share the knowledge.

Posted by Barb Levisay on March 29, 2018