Microsoft has grown its customer base to just under 120,000 customers in 2015, Dynamics SMB general manager Paul White told the audience at the NAV Directions North America event this week.
But staying on track for continued growth through the 2019 goal of over 200,000 customers will require greater focus, Microsoft believes. The NAV team wants partners to focus on attracting businesses with 10 to 99 employees, where its research indicates there will be the greatest investment in new cloud-based ERP, productivity, CRM, and financial systems.
"The NAV business is stronger than ever," White said in a keynote address. "SMB has always been important to Microsoft and it is becoming more so."
Microsoft wants more of its partners to begin reaching for the SaaS ERP opportunity by making it easier to deploy repeatable cloud-based solutions. They introduced attendees to a new Azure-based system built by Microsoft for hosting and managing multi-tenant NAV-based solutions, the Dynamics NAV Management Portal.
The NAV Management Portal is Microsoft's way of providing its partners with a way to sell simplified, multitenant, Azure-based NAV solutions. The platform, which is itself a Dynamics NAV-based system, allows partners to deploy their own IP on top of NAV 2016 and sell it as a subscription service. Unlike a DIY approach on Azure in which a partner might manually provision a set of servers and monitor each component themselves, the Management Portal automates provisioning and offers support and a 99.9% financially backed service level agreement (SLA) for the system as a whole, not individual components.
The approach is not without its tradeoffs. Partners must be willing to forgo certain elements of a traditional NAV solution architecture. There is no direct access to Azure SQL or the virtual machines running NAV, and the platform does not support installing additional software on the VMs. And partners running a managed service solution are expected to stay up to date - at least every three months - with platform updates provided in cumulative updates.
NAV Management Portal is designed - and priced - for use by Microsoft partners who expect to build and market solutions that will support more than ten clients on the same solution. Pricing starts with a $1,500 per month fee for each solution hosted through the service, which accounts for usage by between 75 and 300 total users, Microsoft estimates. As the solution adds tenants and users, and thus more computing resources, new VMs need to be added at a cost of $350 per core per month for NAV virtual machines and $13.20 for new Azure SQL instances. NAV subscription licenses themselves will be priced at $40 per user per month.
For a simple example of a solution with 100 total NAV users across several tenants ,this pricing structure will cost the partner $55 per user per month. Microsoft clarified that this estimate will vary based on the load put on the servers. Higher load would increase costs as extra VMs and databases are added.
Partners will get a simplified invoice from Microsoft when using the NAV Management Portal, officials said. Only one license key is required per solution, rather than licensing it per tenant. And Microsoft will send a single invoice to the partner accounting for the various resources and users on the system.
Microsoft already has fifteen partners on board and between them they have seventy five customers running in the environment. One of those partners, which has 20 tenants already on board, told the audience that the main advantage has been the application management tools.
Pricing, he said, is about on par with the previous approach his team used of hosting their own NAV architecture in the cloud and using SPLA licenses. But the NAV Management Portal's tools for provisioning new systems and upgrading tenants by moving them to new instances with the click of a button has saved his team significant time. And now that they are using the system, they easily stay current on NAV cumulative updates (CUs), something they had fallen behind when they managed the architecture themselves. And there are areas where the system can improve, he said. Fit and finish is lacking in some parts of the portal, and there are still some issues in areas like event handling and authentication that he believes Microsoft will work out.
Microsoft encouraged interested NAV partners to learn more online, talk to the NAV managed service team, and get ready to review and sign new agreements related to onboarding. There are also pricing incentives available for computing fees for partners who get involved in the next few months.
The goal of the managed services ,according to Marko Perisic, general manager for Microsoft Dynamics SMB R&D, is to bring partners along to compete with SaaS solutions in that 10-99 employee segment.
"The message is get to the cloud, that is the way to go," Marko Perisic, general manager for Microsoft Dynamics SMB R&D told Directions attendees in wrapping up a demo of the NAV Management portal. "We've given you the tools to do that. Be repeatable, think about the repeatability of the business."