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Understanding Microsoft Dynamics Products

One of Microsoft's growth engines is the Dynamics family of products.  These are business software applications that include enterprise resource planning (ERP), accounting, finance, operations, human resources, customer relationship management (CRM) and even mixed reality and artificial intelligence. In contrast to operating systems and general purpose applications such as Office 365, Word, PowerPoint, and Teams, Dynamics 365 products are for businesses rather than personal use.  In fact, the Dynamics group was formerly called Microsoft Business Systems.
Every week I get questions from customers about Dynamics 365, so I thought some background in a post like this might be helpful for those who are considering Dynamics products.  

Here is Microsoft's list of application categories for Dynamics:

As the figure above illustrates, there are many product categories and Dynamics products, and Microsoft is adding new ones each year. The Dynamics 365 products have evolved as three groups: ERP, CRM, and other such as artificial intelligence and mixed reality that in some cases relate to ERP and CRM.  Most of the product groups listed on the menu above map to modules of only a few ERP and CRM products. 

ERP Products

ERP products are at the core of Dynamics.  Accounting is a universal requirement for businesses, and many business systems integrate with accounting. The flagship Dynamics 365 ERP products are:

Dynamics 365 Finance (formerly Dynamics AX)
Dynamics 365 Business Central (formerly Dynamics NAV)

These products are prominently featured on the Microsoft website and are offered hosted in the Microsoft Cloud.  They receive significant research and development effort. 

Legacy ERP products area bit harder to find on the Microsoft website:

Dynamics SL (formerly Solomon)
Dynamics GP (formerly Great Plains)

Customers are likely to pick only one of the Microsoft ERP products insofar and its modules as they offer a suite of integrated capabilities that overlap from one to the other.  Dynamics 365 Finance is targeted to larger enterprises and to industries such as manufacturing.    Dynamics 365 Business Central is targeted to small and medium-sized businesses. Both products have many modules from which to choose depending on the needs of a particular business. 

The range of Microsoft ERP products came from a series of acquisitions by the companies that ultimately were acquired by Microsoft and became the Microsoft Business Solutions group. 

This timeline shows some of the key developments for Dynamics ERP. 

Microsoft  targets a broad range of customers with its ERP products, and has widened their appeal to both small and large businesses.  

CRM Products

The CRM side of the Dynamics family has a shorter history than ERP, less than twenty years as of this writing.  The following is a timeline which summarizes some key dates for Microsoft Dynamics 365 (formerly Dynamics CRM).

Dynamics CRM started with the typical trio of customer relationship management applications: sales, marketing, and customer service. 

Lately, Microsoft has picked up the pace of introducing new apps, especially since 2018 when CRM was rebranded Dynamics 365 and the Project Service,  Field Service and a revamped Marketing apps were launched.  

Another important offshoot of the CRM side of the product family is the Power Apps platform which includes Power Apps, Power Portal, Power Automate and more.  You can think of the Power Platform is CRM without any modules such as sales, marketing, or customer service, but rather as a framework for business applications which are based on tracking data such as people, organizations, and transactions.  

Other Products

To complement the ERP and CRM products, Microsoft has added business solutions based on artificial intelligence:

The AI offerings identify patterns in customer, sales, and financial data to gain deeper insights in your business.  Microsoft has made significant research and development investments in AI and is quick to bring these advances into its full range of products. 

Similarly,. the mixed reality products take advantage of Microsoft's hardware and software developments such as Hololens to interface with industrial and business systems. 

Extending Dynamics 365 

Microsoft has maintained a large, global network of software companies and system integrators that take Dynamics products and extend them further and deeper to fit the needs of specific industries.

You can find ERP solutions from Microsoft Gold Partner companies which are based on Dynamics 365 Finance and Operations and Dynamics 365 Business Central as well as the CRM apps for Dynamics 365 for nearly any industry.  For instance, Serenic Software offers accounting for non-for-profits, non-governmental organizations, and education customers which meets their special needs for compliance.  The InfoStrat division of Serenic develops public sector solutions based on Dynamics 365/Power Platform for case management, grant management, victim notification and other functions of federal, state and local government.  

Future Dynamics Products

Although Dynamics products are less well known to the public than Windows and Office 365, they represent a key growth area for Microsoft which has attracted increased investment of money and people.  The pace of innovation and new product releases for Dynamics has increased dramatically over the past five years. 

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