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Key Concepts for Microsoft Dynamics 365: Tenant, Instance, App and Solution


Updated 8/15/2022

To understand Microsoft Dynamics 365 (formerly Dynamics CRM) and Power Apps, you need to learn some new terms and concepts that may be a bit different from what you know from databases and solutions that are hosted on premises.  These concepts also apply to Power Apps.  The main difference is that with Power Apps you are not starting with a Microsoft app but more of a blank canvas for your custom apps. 

This post introduces some key terms and how these concepts are important for planning your implementation.

While Dynamics 365 is still available on premises, it is most commonly deployed on the Microsoft cloud.  This blog post discusses only cloud implementations. Microsoft has multiple clouds such as commercial and government community clouds in several countries.

We start with a Microsoft tenant.  A tenant is the account you create in the Microsoft Online Services environment (such as Office 365) when you sign up for a subscription. A tenant contains uniquely identified domains, users, security groups, and subscriptions.  Your tenant has a domain name of .onmicrosoft.com such as acme.onmicrosoft.com. 

User accounts belong to a tenant, and subscriptions are assigned to user accounts within a single tenant.  For instance, if your company enrolls in Microsoft Office 365, you have a tenant within which all products and apps are run (Office 365, SharePoint, Dynamics and others).

Microsoft handles how the tenant is hosted and applies whatever computing resources are needed for your tenant.  As is true for cloud software, the hardware is abstracted from the customer and managed behind the scenes at the Microsoft hosting centers.

The cloud tenant is the key to security features such as single sign-on. 

A Dynamics 365 model-driven app must be hosted within a tenant on a Dynamics 365 instance.  These include apps such as Sales, Customer Service, Field Service and Marketing.  Users are assigned subscriptions which are good for any and all instances within the tenant.  An instance is analogous to a database.  An instance has the URL format: https://crm.dynamics.com.

Most organizations will have multiple instances of Dynamics 365 to allow for development, testing, staging and production of a solution.  Microsoft designates each instance as production or non-production.  The following shows several tenants and instances:

Source: https://docs.microsoft.com/en-us/dynamics365/admin/multiple-online-instances-tenants 

Instances are handy because admin users can copy them easily.  Microsoft is also backing up your instances constantly so you can restore to a previous state if your instance is compromised. 

Multi-Tenant Implementations

The majority of Microsoft customers have a single tenant.  This allows them to centrally manage all user accounts and make software available to all users.  They can segregate access to data within Dynamics 365 using the business unit features of Dynamics 365.  Business units allow you to define your organizational structure and implement a security model that reflects where a user sits in the organizational hierarchy.  You could define product groups and have sales reps only see opportunities in the group or groups to which they belong.

Why would you need more than one tenant?  In some cases, multiple tenants may be desirable because business units within a company or government agency are more strictly separated from one another, and users never need access to information or systems within other parts of the organization.

Remember that user accounts and subscriptions do not extend across tenants, and that a domain can only be federated with one tenant.

Apps

Dynamics 365 apps were formerly the business applications or modules within CRM such as sales, customer service and marketing.  This catalog of apps has been extended and will likely grow in the future.

An instance of Dynamics can contain more than one app.  When users access Dynamics 365 from their Office 365 menu, they will see a list of all the apps.  This means you may have more than on app which will take you to the same instance of Dynamics 365.

Solutions

Solutions are quite similar to apps insofar as they contain entities, workflows, views, reports and other objects that contribute functions to your Dynamics instance.  The main difference between apps and solutions is that solutions are not controlled by Microsoft.  You can create your own solutions, purchase solutions from third parties, and download and install free solutions.  Solutions are a container that holds Dynamics customizations.

It is common to have multiple solutions within an instance of Dynamics.  Some may be large such as InfoStrat's Grants Manager Plus which contains hundreds of customizations, and others may be small such as a zip code lookup solution.

Solutions may include data as well as customizations.  This is often true for lookup tables and sample data that you may want to include in a distribution. 

The concepts of tenants, instances, solutions and apps govern how you set up and manage Dynamics 365 for your users.






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