Microsoft Dynamics: solid customer stories, quietly confident

Last week I attended Microsoft's Convergence conference in Copenhagen. This is where Microsoft's business application customers tip up to hear what's new and get their annual infusion of feel goodness.

Last week I attended Microsoft's Convergence conference in Copenhagen. This is where Microsoft's business application customers tip up to hear what's new and get their annual infusion of feel goodness. While there was little by way of hard news other than it putting NAV2009 into general availability, customers seem happy with the company and what it is delivering. This is the third time in succession that I've attended Convergence and found largely happy customers. During the keynote, Kirill Tatarinov, corporate VP Microsoft business solutions reeled off a list of customer wins, showing numbers to back up the value the company is delivering.

One that caught my eye was JJ Food Services. According to Tatarinov: "They have over 20,000 customers over in the UK, they drive over 700,000 deliveries every year, and they sell over 20 million items; a pretty significant business...They grew their business by £31 million pounds ($44 million)... And they did it without having to increase cost. Basically, their operations, and their back-office system, was able to sustain the growth of £31 million without having to add a pound to their cost, which is very significant for a company like that. Their order accuracy improved 30 percent, which obviously results in better customer satisfaction, customers didn't have to wait for orders, and orders were much more accurate."

I used the opportunity to capture customers on video to assess what they are getting out of the Dynamics products. If those I met are truly representative of what's happening, then there is a significant untapped learning resource for potential customers. For instance, CRH Europe talked about how it has scaled NAV way beyond limits that were thought possible in the past. The usual limit is something around 200 concurrent users. CRH says it has tested to 500 users and anticipates going well above 750 users: 'possibly double.'

Assuming they achieve that figure then it puts NAV firmly in the mid-tier territory usually reserved for JD Edwards and SAP's A1S. The difference is that Microsoft is able to offer maintenance at 16%, significantly less than that available from Oracle and SAP. Jan Henk Leeuwenburg of Fokker Services explained an unusual CRM implementation that puts information needed for compliance in the hands of its customers. (see video above) In each case, the emphasis was on value.

The only significant blot on the landscape is the extent to which Microsoft is able to upgrade its customers to the new 2009 versions of Dynamics AX and NAV. Some customers want to hang back on the grounds that the new functionality is not enough to tempt them. One customer went as far as to say that issuing a new version every 24-36 months is too quick. That despite the introduction of web services and role based content included within user dashboards. In the finannce users' dashboard for instance, Microsoft is including syndicated content from Tatarinov, responded with: "We are happy to continue supporting customers while they decide whether to take the upgrade."

Elsewhere, Microsoft started to talk about doing more in vertical markets, saying that it will add broad industry specific functions. While not entirely clear on what's in and out on the development front, it emphasized that VARs and ISVs will be left to do the deep lifting for specialized functionality needed in specific verticals. It also hinted at establishing an SAP style solutions hub: "We want to set up a marketplace in which customers and partners have confidence. We have a lot of work to do but so far, customers and partners welcome the move," said Doug Kennedy, VP Microsoft Dynamics partners.

This was a modestly confident yet cautious Microsoft, happy to parade good customer stories. This is to be welcomed and a sharp contrast to other shows where the emphasis is often on ensuring the company's message is not tempered by customer reality. As we move forward in an uncertain economy, these stories will become much more important to commenters and customers alike.