In our previous article, we discussed the risks of continuing to use Dynamics products that are no longer supported. Today, we'll explore the benefits and key points to consider when upgrading to Dynamics 365, the successor product line.

First, here's how the discontinued Dynamics products correspond to their successor products in the Dynamics 365 family:

Discontinued Products	Successor Product
Dynamics AX	Dynamics 365 Finance & Operations
Dynamics NAV	Dynamics 365 Business Central

Let's examine the key characteristics shared by these rebranded Dynamics 365 products:

1. Flexible Deployment Options: Cloud or On-Premises

The most significant feature of Dynamics 365 is that it can be used either as a cloud-based (SaaS) system or in the traditional on-premises platform. Previously, Dynamics AX/NAV system infrastructure was only available in on-premises platform, requiring user companies to build and operate their own servers (or contract separately with data centers). With Dynamics 365, Microsoft provides functionality as a SaaS solution based on Azure data centers, allowing companies to eliminate the costs of building and operating their own servers by choosing the SaaS option.

2. Shorter Product Lifecycle for On-Premises Versions

Traditional Dynamics products typically had product lifecycles (the period from product release until reaching EOSL) of five years or more. In contrast, Dynamics 365 on-premises versions have significantly shorter lifecycles - approximately 8 months for Finance & Operations and 1.5 years for Business Central.

This means that to avoid the risks associated with end-of-support (discussed in our previous article), companies need to handle version upgrades more frequently - every six months to one year. However, as mentioned before, when the version gap is smaller, upgrade costs can be kept lower. Therefore, it's important to include version upgrade work in your annual system maintenance budget to prevent version gaps from developing.

3. Mandatory Version Updates for Cloud Version

Unlike the on-premises version discussed above, the cloud version is managed by Microsoft on their server environment, which means the latest version is automatically applied on a regular schedule. While this eliminates end-of-support risks, it requires users to regularly verify their systems before version updates.

The specific process is as follows:

• First, each user company receives access to a sandbox environment with the new version
• Users must verify that their customizations work properly in the new environment (if issues are found, program code needs to be modified)
• After verification and fixes are complete, users specify their preferred date and time for the production environment upgrade to Microsoft

As of September 2024, the update frequency is:

• Finance & Operations: 4 times per year (can skip 2 updates)
• Business Central: 2 times per year

Therefore, for cloud versions, it's essential to secure budget for at least two pre-upgrade verification cycles in your annual system maintenance budget.

4. Utilizing Dynamics 365's Cloud Services (Power Platform)

While Dynamics 365 currently offers both on-premises and cloud options, following the global trend toward cloud computing, Microsoft is expected to increasingly enhance the cloud version of Dynamics 365.

A prime example is the Power Platform suite of cloud services, which can be used free of charge to extend the functionality of Dynamics 365 and Office 365 (some features require additional paid licenses). Here's a brief overview of these services:

Service	Description
Power Automate	Workflow and RPA building platform
Power BI	Business Intelligence reporting tool
Power Apps	Low-code application development tool
CoPilot	AI-powered user assistance tool (operation support, data analysis assistance, etc.)

Summary

We have introduced the key characteristics of Dynamics 365 products along with their benefits and points to consider.

In our next article, we'll address frequently asked questions about Dynamics 365, focusing on ERP system modernization strategies specifically relevant to Japanese companies operating in Thailand