Microsoft Dynamics 365

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Dynamics 365

by Faulkner Staff

Docid: 00011049

Publication Date: 2201

Report Type: PRODUCT


Microsoft Dynamics 365 is a portfolio of enterprise resource planning (ERP) and
customer relationship management (CRM) applications tailored for
sales, customer service, and marketing activities. It is targeted at
small- and medium-sized businesses, enterprises, and government agencies.
Among Dynamics 365’s capabilities are integration with Cortana,
Microsoft’s digital assistant; access to documents via integration with
OneDrive for Business; and document generation capabilities. The package is
updated in two release waves per year: Release wave 1 covers features becoming
from April through September, while release wave 2 covers features issued from
October through March. Approximately two months before each release, customers
and partners can obtain early access in order to test and validate the new
features in a non-production environment. This report provides an overview of Dynamics 365’s
key features.

Report Contents:


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Microsoft Dynamics 365 is a set of intelligent enterprise resource planning (ERP) and
customer relationship management (CRM) application from Microsoft Corp. that offers customer
service, sales, and marketing applications.

Related Faulkner Reports
Microsoft Company
CRM Market

CRM (customer relationship management) is part of a business strategy to
improve customer interactions, gain and retain clients, and increase
productivity. Microsoft – like rivals Oracle, SAP, and –
provides CRM software that is intended to help drive these goals.

Microsoft launched Dynamics in November 2015, offering
integration with Cortana, Microsoft’s digital assistant, to allow for
voice command capabilities. The new release also offered users access to
their documents within the Dynamics CRM via integration with OneDrive for
Business and new document generation capabilities. Also included was Delve
functionality, powered by Office Graph, and designed to
increase productivity by surfacing key content.

Key features offered with Microsoft Dynamics CRM include:

  • A redesigned user interface with click or tap capabilities.
  • CRM apps for major mobile operating systems.
  • Enhanced business procedures for productivity.
  • Social Insights brings social media data directly into dashboards and entity forms in Dynamics 365 apps.

Productivity Features. Dynamics 365 offers features to
improve customer interactions and increase productivity across various
client-facing departments. Examples include sales order automation,
invoice status checking, and sales trend identification.

Targeted Users. Microsoft Dynamics 365 software is
designed to meet the needs of enterprises, small- and medium-sized
businesses (SMBs), and government users.

Service Models. Dynamics 365 can be deployed on-premises
or through a cloud-based, online subscription.

In October 2021, Microsoft revealed the Dynamics 365 2021 release wave 2
plan. This plan details the new features being releasing from October 2021
through March 2022. The wave 2 release contains hundreds of new features across
Dynamics 365 applications, including Marketing, Sales, Customer Service, Field
Service, Finance, Supply Chain Management, Supply Chain Insights, Human Resources,
Commerce, Fraud Protection, Business Central, Connected Spaces, Guides, Remote
Assist, Customer Insights, Customer Voice, and Microsoft Cloud for Healthcare,
Financial Services, and Nonprofit.


Name: Microsoft
1 Microsoft Way
Redmond, WA 98052
(425) 882-8080
Type of Vendor: Information Technology
Founded: 1975 (As Micro-soft)
Service Areas: Worldwide
Stock Symbol: MSFT (NASDAQ)

Access to Client Information. Microsoft’s CRM software
provides company staff with access to customer information in order to
improve employee interactions with clients. Dynamics CRM can provide
access to up-to-date customer data to anyone in an organization.

Custom Work Portals. Dynamics 365 delivers custom
workspaces where employees can create and reuse views of customer data.
One portal – the service calendar – allows service planners and
dispatchers to schedule activities by resource, time, or service. Dynamics
365 also provides views of reporting and analysis figures, and it provides
mobile support to field workers on a number of devices.

Integration with Other Microsoft Software. Dynamics 365
offers tight integration with Microsoft Office, especially with Outlook
e-mail. This enables users to easily pull information into Office system applications. It also integrates with other Microsoft
Dynamics workforce products, the Excel spreadsheet software, and Microsoft

Web and Mobile Versions. Microsoft is now developing CRM
software that can cross multiple platforms and be deployed in the cloud.
Examples include Microsoft Dynamics CRM Online, mobile access, and
collaborative platforms.

Microsoft .NET Framework. Dynamics CRM was built on the
Microsoft .NET framework, allowing it to integrate easily with other
applications including Microsoft Office and Outlook. The product’s ability
to integrate with Microsoft and third-party software allows users to pull
customer data from a variety of sources.

Dynamics 365 Business Central. Business Central is
designed to be an all-in-one business management offering that can connect
businesses to customers and help them make better decisions. It is an
enterprise resource planning tool intended to connect financials, sales,
service, and operations to streamline business processes.

Figure 1 illustrates Microsoft Dynamics 365 Business Central.

Figure 1. Microsoft Dynamics 365 Business Central

Figure 1. Microsoft Dynamics 365 Business Central Interface

Source: Microsoft

Figure 2 provides a view of Dynamics 365 Sales interface.

Figure 2. Dynamics 365 Sales Overview

Figure 2. Dynamics 365 Sales Overview

Source: Microsoft

Social Insights

In Dynamics 365, Microsoft offers data, insights, and connections
directly into Microsoft Dynamics 365. In the Professional edition, these
features appear automatically within CRM accounts, contacts, and leads. It
allows users to utilize a one-click sync in CRM. They can also receive
alerts about sales opportunities or prepare for calls by scanning Company
Insights and Social Buzz features, in addition to tracking sales leads
through Watchlist.


Microsoft Dynamics 365 offers three main modules that address the sales,
customer service, and marketing aspects of customer relationship
management. Table 1 describes each module.

Table 1. Microsoft Dynamics 365 Modules
Module Description Tools
Sales Dynamics 365 is designed to help an
organization’s sales staff increase their productivity. Sales
software provides a user interface to manage leads and coordinate
sales activities across an organization.
  • Planning
  • Leads
  • Opportunities
  • Accounts
  • Productivity
  • Pipeline
  • Workflows
  • Mobility
  • Analytics
Customer Service The Customer Service
module supports customer service initiatives by helping employees
respond more quickly to service issues, apply appropriate
resources to service requests, and schedule and dispatch services.
  • Accounts
  • Cases
  • Contracts
  • Knowledge Base
  • Scheduling
  • Workflows
  • Mobility
  • Analytics
Marketing The Marketing component allows
organizations to develop customer-facing marketing strategies and
analyze leads and marketing campaigns.
  • Data
  • Segmentation
  • Planning
  • Execution
  • Events
  • Response
  • Internet Marketing
  • Productivity
  • Workflows
  • Mobility
  • Analytics

Other Dynamics Products

Table 2 lists additional versions of Dynamics 365 as well as other
Dynamics Products.

Table 2. Microsoft Dynamics Products
Module Description
Dynamics CRM Online
  • Internet-based CRM Application. Microsoft
    Dynamics 365 is a software-as-a-service (SaaS) offering that
    is hosted and managed by Microsoft. Launched in 2008, the
    service delivers marketing, sales, and service features from a
    Web browser directly to Microsoft Office and Outlook.
  • Internet Marketing. Updates to Dynamics 365
    Online have included Internet marketing campaign features.
    These features allow users to create and manage online and
    search engine campaigns, research and bid on search words,
    gain insight into ROI by studying click-through and conversion
    rates, and capture sales leads using pages hosted by Microsoft
    or the organization’s Web site.
Third-Party Hosting Organizations have the option to run
Microsoft Dynamics 365 as a partner hosted deployment, where the
software is deployed at a remote location by a company that runs
and maintains the software and charges a user fee. The Microsoft
CRM hosted system is built on the same code base as Microsoft CRM
Professional Edition.

  • Microsoft CRM Hosted Solution with On-premise
    This option offers the Microsoft CRM
    solution in a hosted, off-site scenario. It targets those
    organizations that operate on-premise Exchange Servers and do
    not wish to move this service off-site.
  • Microsoft CRM Hosted Solution with Hosted Exchange.
    Using this scenario, organizations can host Exchange along
    with Dynamics CRM 3.0. The option frees users from providing
    on-site messaging systems, as the service provider manages and
    maintains both services.
Other Dynamics Products

The Dynamics unit is the company’s built-through-acquisitions
group that is looking to provide Microsoft with an entry to the
back-end business applications market. Microsoft offers other
Dynamics software products for enterprises, many of which will
integrate with Microsoft Dynamics CRM. These products include:

  • Microsoft Dynamics AX
  • Microsoft Dynamics ERP
  • Microsoft Dynamics GP
  • Microsoft Dynamics NAV
  • Microsoft Dynamics SL


Microsoft Dynamics provides the major features that businesses look for
in a CRM product – sales and marketing portals, analysis, software
integration, and others – in a familiar Microsoft Office format. While
corporate CRM projects have a reputation for risk, Microsoft’s portfolio
provides a familiar interface for sales and contact center agents. In
addition, technology staff and developers who are Microsoft certified may
find it easier to integrate a Microsoft product than a niche CRM offering.

Microsoft keeps abreast of trends in order to go after the clients of
rivals Salesforce and Oracle. As an example, Microsoft continues to
update Dynamics 365 Online and its other cloud-based software with
features that are desired by both Microsoft partners and customers –
including Internet and wireless access, advanced data import, custom
views, and simple price structures.1,2 Microsoft’s competitive
pricing for its hosted version of Dynamics is seen by some as one of
Salesforce’s largest threats.3 In addition, Microsoft has
increased its CRM developer capabilities for small business users through
its Azure Developer Services platform4 and BizSpark program for
start-ups. Finally, Microsoft is able to market Dynamics CRM through
alliance partners, such as EDS (Hewlett Packard’s outsourcing division),
for hosting and management of its CRM deployments.5

Microsoft Dynamics 365 is a significant release for the company. Its
voice and cloud technologies make it attractive to businesses as either a
new implementation or an upgrade. Also, Microsoft’s acquisition of
LinkedIn was intended to help it advance its position in “social selling,”
using LinkedIn’s database and combining it with LinkedIn’s Sales


Dynamics 365 is fundamentally designed for small businesses, delivering
individual software modules instead of an all-inclusive CRM product.
Microsoft was also late to the table with an online offering. Whether it
can compete with Salesforce remains to be seen. In 2020, Salesforce had an
approximate market share of 19.5 percent, SAP and Oracle each had 4.8 percent,
while Microsoft had approximately 4 percent of the market.6

On another note, Dynamics 365 is mainly compatible with Windows, leaving
out organizations that run their environments on either Unix or Linux.
With Linux becoming increasingly popular due to its open nature and its
cost, many SMBs running Dynamics 365 are considering a switch to open
source CRM systems.


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Microsoft now positions its CRM software as a platform for government
and enterprise users. Traditionally, it has been used by SMBs and smaller
departments within a large enterprise. The product’s familiar Office
interface and modular design can be understood quickly by employees and IT
staff, requiring a low investment for training and increasing the odds of
success for a smaller company’s CRM deployment. Ultimately, this may
increase the efficiency of sales and marketing operations at these

Industries that Microsoft targets with its CRM software include
construction, distribution, healthcare providers, health and social
services, hospitality and entertainment, government, financial services,
manufacturing, professional services, and education.


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Microsoft has increased Dynamics 365’s ability to operate on multiple
platforms such as mobile devices, Web browsers, Outlook e-mail and
collaborative software, enterprise portals, and custom user interfaces.
Microsoft Dynamics 365 can also integrate with other Dynamics business
management and workforce software.

Dynamics 365 software runs on a Microsoft Windows server, which end-users
can access using a PC client. Each server that runs Dynamics 365 requires
a server license. Table 3 outlines the operating environment of Microsoft
Dynamics On-Premise offers.

Table 3. Microsoft Dynamics On-Premise Offers
Environment Dynamics 365 Workgroup Dynamics 365 Professional Dynamics 365 Enterprise
Offering Workgroup client server includes five
access licenses.
Professional server, client license
sold individually.
Professional server, client license
sold individually.
Clients Outlook, Web, offline, and mobile
Outlook, Web, offline, and mobile
Outlook, Web, offline, and mobile
Features Sales, service, and marketing
automation functions. Workflow automation and custom extensions.
Sales, service, and marketing
automation functions. Workflow automation and custom extensions.
Social Insights capabilities.
Sales, service, and marketing
automation functions. Workflow automation and custom extensions.
Customer Support Included. Included. Included.
Training Services Included. Included. Included.
Integration Web services SDK and offline. Web services SDK and offline. Web services SDK and offline.
Operating System Microsoft Windows Server 2016, 2019, 2022
Microsoft Windows Server 2016, 2019, 2022
Microsoft Windows Server 2016, 2019, 2022
Database Microsoft SQL Server 2005 workgroup server or
Microsoft SQL Server 2005 workgroup
server or higher.
Microsoft SQL Server 2005 Enterprise or
higher (32 and 64 bit).

Table 4 outlines the operating environment for Online capabilities.

Table 4. Dynamics 365 Online
System Description
  • 5 GB
Security-Enhanced Access
  • Windows Live ID
  • Outlook
  • Web
  • Mobile
  • Offline
  • Sales, service, marketing, workflow and system
    customization, Internet lead capture, offline synchronization,
    mobility support, version upgrades, patch installations,
    unlimited application troubleshooting.
Customer Support
  • Included.
Training Services
  • Included.
Uptime SLA.
  • 99.9% uptime
  • 200
Custom Entities
  • 300


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Microsoft offers its CRM customers a range of support options. Live
support includes telephone contacts, support requests online or by phone,
corporate support plans, training, and user groups. Microsoft also
provides online documentation and help resources. The four programs it
offers are subscription, enhanced, professional direct, and premier.

Support options include:

  • Enterprise Agreement (EA)
  • EA Subscription
  • Enrollment for Education Solutions under Campus School Agreement
  • Microsoft Online Services Program (MOSP)


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Typical pricing for Microsoft Dynamics 365 depends on a number of factors
including installation method, service options, and which edition is best
suited for an organization. The Dynamics 365 Plan starts at $115 USD per
user per month for the Customer Engagement plan. The Unified Operations
Plan starts at $190 USD per user per month. The Dynamics 365 Plan starts
at $210 per user per month. Dynamics 365 Business Central starts at $70
per user per month. Interested customers should contact Microsoft’s sales
staff or one of its partners. Contact details are available on Microsoft’s
Web site.


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Microsoft’s on-premises CRM software competes primarily with software
from heavyweights Oracle and SAP. provides the leading
cloud-based CRM option, and it is the biggest threat to Microsoft in the
SMB and cloud computing sectors. Other competitors include Amdocs in the
telecom service provider markets, as well as Infor, NetSuite, and


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