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The BIG 5 – SAP ERP vs Dynamics 365 for Finance and Operations

Jose Valentin-Cruz

Jose Valentin-Cruz

The Microsoft Dynamics AX/D365 Support Team at Avantiico is focused on solving our client’s problems, from daily issues to large and more complex problems.

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Enterprise Resource Planning (ERP) solutions have nowadays become an essential part of any organization that needs to manage their business functions within a centralized and integrated system. Organizations that need to manage their staff, customers and inventory can all rely on ERP benefits. The need of using ERP brings up a very interesting debate for many companies when selecting the system that is best for them. Have you ever been faced with the conundrum on how mainstream ERP systems differ from each other and which one is best suited for your business? In this article I will point out 5 differences between two ERP software companies that have become leaders in their market: SAP ERP and Microsoft Dynamics 365 (D365) for Finance and Operations.    

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SAP ERP VS. Dynamics 365

Enterprise resource planning systems have become an essential part of many organizations that manage their business functions in a centralized and integrated way.  The data entered in ERP systems are stored in a common database which allows all departments within a company to have access to the same information. This data stored in the ERP system allows businesses to organize this data, analyze it and create reports that can help the business with decision making in their day to day operations.

Two major contenders in the ERP systems platforms market are SAP ERP and Dynamics 365 for finance and Operations. Both platforms are very powerful but below I will share 5 reasons why Microsoft Dynamics 365 for finance and operations has been the ERP system many organizations have already selected.

1. Lower Implementation Costs

Implementation costs are always of grand importance when selecting the system to use in your business. Every company is looking for a system that can accommodate their needs but at the same time can help them stay in budget. Implementing a system like SAP ERP can cost anywhere from $500,000 to $2,000,000.00 for a medium sized business. 

This expense will depend on the number of customizations that the client wants to add to the standard SAP solution. These customizations are done through ABAP coding which will require specialized developers that come at a high cost for the system implementation.  These customizations also come at a big disadvantage to companies because, once they customize standard transactions or reports within the system, SAP will no longer support this part of the solution. 

When taking into consideration Dynamics 365, the need to customize the system can be greatly minimized using the PowerApps application development platform. PowerApps was designed as a way for anybody – regardless of experience or software knowledge – to create useful business applications with a few clicks of the mouse because the application is automatically coding in the background while you are clicking through the options. With PowerApps you can create robust applications outside of D365 that will connect this application with the live data within D365. Many businesses have taken full advantage of this software within D365 by creating smartphone Apps that connect with the system giving their businesses an edge due to the mobility they have acquired.

2. Usability and Integration

When talking about usability every business needs a system that will not only cover their basic needs but will also accommodate any advancements that may occur with time. Another aspect that is of great importance within ERP solutions is the level of integration of the system. ERP systems need to work well with other applications either for internal business needs or when dealing with outside entities with which data needs to be exchanged. 

As expected from Microsoft, they have made sure that Dynamics 365 works with all their other products making it the perfect example of a hyper-connected software. Due to this, businesses can take full advantage of the functionalities that the Office 365 suite offers without worrying if this system will integrate with their ERP system. This has also been the case with the systems evolution in the Market. Even though new functionalities are continuously being added to D365 these new functionalities are designed to work effectively with all other Microsoft products. Additionally, Dynamics 365 software has a look and feel that is very similar to other Microsoft software like Office.  These features provide a sense of familiarity to most users which in turn accelerates the user training process and increases the effectiveness of the implementation process. The system also offers a high level of integration with Microsoft products which gives the users the ability to perform several tasks in the ERP system like create Word documents or even create e-mails within the systems interface.

On the other hand, even though SAP ERP is considered by many an antiquated system it has been progressively updated through continuous iterations over the years.  This subsequently brings several concerns when companies need/want to upgrade to the latest version of the software. These upgrades will force the company to invest in an implementation project that will roughly have the same cost as the initial implementation of the system due to the integration of outside software (such as Office).  Many times, these integrations are affected, and this will further increase the expense of the implementation since additional hours will be needed to solve these issues. In regard to the usability the system can be a very powerful tool, but the navigation is not as intuitive as the D365 platform. On top of this, many businesses have often complained that the standard SAP solutions can be too restricted and cause businesses to have to redesign their processes when switching to this ERP platform.

3. User-driven Extension

Dynamics 365 has taken a step forward here by allowing users to build their own mobile apps using a drag-and-drop interface that does not require advanced programming skills (PowerApps). On top of this, D365 gives the user the ability to make modifications in the system using Microsoft Flow. Flow is a cloud-based software that will help you create workflows that use third-party solutions. For example, let’s say that your company is interested in collecting the social media data to help improve marketing. Flow will allow you to create a workflow that can collect this data from social media and aid your marketing department develop a plan to improve the overall customer satisfaction of your brand.

 

4. Artificial Intelligence (AI)

Both SAP ERP and Dynamics 365 have AI solutions integrated within them. For example, SAP has the use of bots to simplify or automate many manual tasks within the system.  Nonetheless, Microsoft Dynamics 365 has taken this a step further allowing the system to do things like the following:

  • Process transactions and manage inquiries
  • Deal with multiple languages
  • Handle and apply several compliance controls
  • Process and manage e-mails

5. Cloud Strategy

Over the years SAP has invested heavily in a cloud strategy but has been unsuccessful in keeping up with the industry in delivering a disruptive ERP cloud strategy.  SAP has also been minimally successful in responding to the increased demands for technology that supports business strategies such as social CRM and customer experience. They did release “Business by Design” as a cloud solution but this product has incurred in severe go to market mistakes and poor market acceptance.

On the other hand, Dynamics 365 offers a completely cloud based solution that allows the user to connect and work with D365 anywhere in the world if they have an internet connection. This cloud-based strategy gives the users the ability to have their company’s information at their fingertips allowing them to tend to urgent business issues whenever they occur. D365 has also extended this cloud-based strategy to their Customer Engagement solution. The Dynamics 365 Customer Engagement Solution is a CRM solution that can help drive sales productivity and improve the value of the marketing efforts through social insights, business intelligence and campaign management.   

Why Choose Dynamics 365

Dynamics 365 offers businesses a unified, user friendly interface that provides your team with everything they need to perform their job efficiently without having to toggle between different apps or transferring data across programs. Also, the interface has a familiar feel which helps users adapt to the system quickly when rolling out as your new solution. 

In conclusion, selecting the correct ERP solution can be a difficult task for any company, but it is a very important step towards the future of your business.  That is why you should assure yourself that you are selecting a cutting edge ERP software that will fulfill your business needs but will also provide the opportunity to evolve your business as the market continues to change.    

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