Dynamics Day '11 - The Cloud: What it means for Dynamics

What Does ‘The Cloud’
Mean for Dynamics?
Chris J.T. Auld
CTO, Executive Director – Intergen

Sam Hazledine
Managing Director - MedRecruit
10 August 2011

What Does ‘The Cloud’ Mean for Dynamics

What We’ll Discuss
 What is ‘The Cloud’
 Generally
 The Microsoft Cloud Platform
 Cloud Benefits
 Promised
 Realized
 The Dynamics Cloud Offerings
 Cloud Challenges
 Getting there
 Security, reliability, legality
 Real World Example: MedRecruit

“Cloud Computing is a model for the procurement
of computing resources whereby they are
purchased as a utility and consumed over the
Internet.”


Software as a Service Platform as a Service


What Does it Mean for Dynamics
 Trust Microsoft as a massive cloud vendor
 Sum Business and Consumer services to establish scale
 Global Foundation Services (GFS) run all data centers
 http://www.youtube.com/user/MSGFSTeam
 Plenty of Cloud Bits to Consume
 Even if you don’t consume Dynamics from the cloud
 Office 365, Windows Azure etc…

Cloud Value Proposition

The Why…


New Economics Reduced Management Increased Agility

• Pay for what you use • No maintenance • Latest software for users
• Predictable costs • Faster deployment • Internet collaboration
• Shift from capital expenses • Instant upgrades • Anywhere access
to operating expenses • Multilayered security • Instant self-provisioning
• Economies/Qualities of framework and backup
Scale


What is driving investment decisions?


What are we actually buying?


Dynamics CRM Online
 1st Class Cloud Support
 Underlying architecture is multi-tenanted
 CRM 2011 is 2nd iteration of Cloud offering
 True Software as a Service
 Near 100% parity between Cloud and On-Premise
 Commitment to release to Cloud first
 New features will land in CRM Online immediately
 Very fast setup
 Up and running in 15 minutes


Typical Microsoft Dynamics CRM 50 user deploymentDynamics
General costs On-premise cost
Microsoft
Savings
CRM Online cost
=
Infrastructure , Hardware
$85,000 Included
OS’s & maintenance

CRM Software/ SaaS Fees $78,000 $94,000

Operations (1 day / month) $45,000 $45,000

Total $208,000 $139,000 $69,000

Per user per month $115/user/month $77/user/month $38/user/month

Back of the Envelope.
Incl. External connector, 3 servers.
Cost of capital: 12%


Dynamics ERP Online
 Commitment to ship all 4 ERP’s as Online Offerings
 NAV ‘7’ will be first – sometime in 2012
 AX, GP, SL will follow with their next versions
 Caveats
 We don’t know exactly what it will look like yet
 Don’t know how Azure COGs will affect pricing
 Right Now
 SPLA Hosted NAV in Intergen virtualized datacentre
 App-V can deliver additional benefits


What Does it Mean for Dynamics Customers
 Office 365 is an easy first step for existing customers
 Light up SharePoint and Lync integration quickly/cheaply
 CRM Online default choice for new deployments
 Cost saving are real and significant
 Migration more nuanced
 Windows Azure ideal for Customer Portals
 Cheap (~$200/month)
 Reliable
 Scalable independent of Dynamics bits
 ‘All in the Cloud’ possible for new businesses
 Office 365 + CRM Online + Windows Azure
 ERP Products still >9 months out for cloud support
 Anticipate more challenges to CRM Online
 Don’t delay ERP investment in anticipation
 Focus on web services based integration


Getting there…
 Migration costs are largely fixed.
Similar cost to move 10 users as to move 1000 users
 Say it costs $25,000 to move our CRM to Online…
Cost per Month incl
Cost Per Month Savings Per Month Savings per Month
Number of Users Cost to Move
@ $77/user @ $38/user by moving
(36mnth@12.5%)

10 Users $770 $380 $836 ($456)

100 Users $7,700 $3,800 $836 $2,964

1000 Users $77,000 $38,000 $836 $37,164

10,000 Users $770,000 $380,000 $836 $379, 164


Guidance for Migration
 Run the numbers
 Especially if you are chasing cost savings
 Are there other reasons to move- can you ‘value’ them?
 Don’t invest in migration
 Much of the fixed cost is in up-skill
 No way for enterprise to re-use these skills
 Use 3rd party with skill to minimize cost
 Consider phased approach
 E.g. Move code to be CRM Online ready during maint.
 Endeavour to maintain deployment neutrality
 Keep on-premise code online compatible


Who is concerned about security?
Why should I trust <xxx> with critical
systems?


How secure is your current ‘datacentre’?

+ +


or
0 People per Day ~120 People per Day
US Airline Fatalities US Vehicle Fatalities
2010 Total = Zero 2010 Average


Comments on Security and Reliability
 Qualities of Scale
 24/7/365 onsite staff
 Best engineers in the world
 More redundancy
 Consider reliability ‘per mile’
 Resist psychological foibles
 Being in control doesn’t make things safer
 Use savings to improve on-premise assets
 Save money moving to CRM Online?
Spend some of it on a redundant network connection.


The Legal Minefield


Legal Questions
 What do local laws say about data storage?
 Tax Administration Act requires us
“to keep sufficient records in New Zeaand”
 http://tinyurl.com/ird-alert
 Does cloud hosting create a nexus to a jurisdiction?
 For tax purposes?
 Anti-trust law? Securities law?
 Which law applies & courts would rule on any dispute?

A Worked Example
MedRecruit Limited


About MedRecruit
KEY DETAILS
 Founded 2006
 Started on CRM 3 + Small
Business Server 2003
 Grow at 100+% per year
2nd Deloitte Fast 50 in 2009
 Originally all on premise;
now hybrid on premise +
cloud
 Key focus now is driving
operational efficiency
 HQ is Queenstown
Australian office is
Coolangatta


Email and Core Productivity
KEY DETAILS

 Email is Mission Critical
 Don’t want anything fancy;
Great Outlook support is a
must
 Moving to Office 365 was an
obvious choice
 Moving was harder than we
expected; plenty of gotchas
 Exploring opportunities to
use Lync + SharePoint
 What does Skype acquisition
mean?


Dynamics CRM + Customer Portal
KEY DETAILS

 CRM is Core LoB System
 Users since version 3
 Extensively customized
 Customer self service portal
 Would like to move to Cloud
 Not for cost reasons
 Reliability focus

 Hard to get there
 3 versions of customizations
 A big functionality work stream

 Will move portal first
 Prepare CRM over time


Core Financials
KEY DETAILS

 Been on Xero since day 1
 Xero delivers all those
promised benefits of Cloud

 Xero runs out of Ooomph as
business becomes complex
 Integration with CRM
 Large invoice volumes
 Buyer generated invoices

 Moving to NAV; Hosted by
Intergen

Thank you
chris.auld@intergen.co.nz
twitter.com/cauld

sam@medrecruit.com
twitter.com/medrecruit

Dynamics Day '11 - The Cloud: What it means for Dynamics

Dynamics Day '11 - The Cloud: What it means for Dynamics

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Dynamics Day '11 - The Cloud: What it means for Dynamics