Many purchases today are not bought with the intent of keeping them forever. Maybe you trade in your smartphone every two years to get the most recent model. Or perhaps once your kids leave the nest, you start to consider a smaller home. From cars to appliances to timeshares, just about everything depreciates.
That said, your business’s enterprise resource planning (ERP) software is something you’ll want to stand the test of time.
If you’re on Microsoft Dynamics GP, NAV, SL, or AX, and ready to migrate to one of Microsoft’s modern cloud-based ERP platforms, learn how to choose the right system that will grow with your business. Here are the factors to consider when taking your next step in the Microsoft ERP ecosystem, Business Central vs. Finance and Supply Chain.
The Resilience of Cloud-Based Technology
In today’s rapidly evolving technological landscape, making the right decisions for your business’s IT infrastructure is crucial. Implementing cloud-based ERP presents an opportunity to not only enhance your operations but also ensure that your investment lasts for the long haul.
One of the significant advantages of the cloud is its inherent scalability and flexibility. Whether you experience sudden growth or need to adjust resources during lean periods, cloud platforms provide the elasticity to meet your changing demands.
Cloud-based ERP also offers seamless integration with other systems, enabling efficient data sharing and collaboration across platforms. Whether it’s integrating with customer relationship management (CRM) systems, third-party applications, or emerging technologies like artificial intelligence (AI), the cloud provides a robust foundation for interoperability.
Ultimately, a cloud-based ERP system future-proofs your business by maximizing your IT investment, allowing you to stay competitive and leverage new technologies as they emerge without the need for extensive reconfiguration or system overhauls.
How to Choose an ERP That Will Work Now and in the Future
Companies using Microsoft Dynamics GP, SL, NAV, or AX as their on-premises or hosted solutions have many possibilities when it comes to choosing an ERP solution.
Determining the most suitable path for your organization will depend on several factors, including your business’s nature and scale, growth plans, complexity of requirements, and investment preferences.
By default, Microsoft recommends that GP and NAV users transition to Microsoft Dynamics 365 Business Central, while AX users are encouraged to migrate to Microsoft Dynamics 365 Finance & Supply Chain Management. However, there may be circumstances where it may make sense to consider an alternative.
Microsoft positions Finance & Supply Chain Management for organizations that possess one or more of the following characteristics:
- Multinational operations
- Complex or multi-site manufacturing or distribution operations
- High transaction volumes
On the other hand, Microsoft positions Business Central for organizations that exhibit one or more of the following characteristics:
- Operations confined to a single country
- Straightforward manufacturing and distribution processes
- Fewer than 250 users
While these provide some guidance, they often raise more questions than they answer. Microsoft typically refrains from issuing strong recommendations, preferring to empower their customers to make the final decision.
In this regard, Sikich, with an extensive client base covering all four legacy on-premises products, can offer greater clarity when it comes to the question of “What next?”
Sikich has helped clients using AX transition to Business Central, and clients using GP, SL, and NAV migrate to Finance & Supply Chain Management. Our NAV clients are adopting both the Software as a Service (SaaS) and On-Premises versions of Business Central.
The decision-making criteria adopted by our clients fall into the following categories:
Company Revenue
Revenue as a decision-making factor is somewhat arbitrary as it overlooks operational complexities. Still, it provides insight into an organization’s perspective on the relative affordability of each option, as Finance & Supply Chain Management is typically a larger investment than Business Central.
Not only that, but Finance & Supply Chain Management offers functionalities typically sought after by larger organizations with a need for more intricate financial management and reporting.
Companies with revenues surpassing $150 million/year and experiencing growth typically evaluate both Microsoft solutions before deciding on their next move.
Businesses generating revenues between $50 million and $150 million generally lean toward Business Central. For companies with revenues below $50 million, Business Central SaaS tends to be the preferred option.
The final choice depends on factors such as the complexity of their requirements, the Independent Software Vendor (ISV) integrations they require, the number of anticipated modifications and transaction volumes.
Budget
An organization’s budget often serves as the determining factor that steers them towards one solution over the other. With ERP projects, affordability is crucial because not having sufficient funds can create serious risks for the business.
At the time of publication, Business Central SaaS with the added feature of Manufacturing and Service Management is $100*/user/month. The solution without this added function is $70*/user/month. Additionally, there are options for Team users, providing read-only access and basic transactions, as well as Device users for shared devices.
For Finance & Supply Chain Management, the cost is $210*/user/month for all features and functions encompassing both Finance and Supply Chain Management suites. It is possible to purchase Finance and Supply Chain Management separately, and there are options for lower-function users.
In addition to the software costs, the price of implementation can vary significantly depending on the project’s scope and complexity.
Metrics
Microsoft cloud solutions are designed to handle large volumes of data and provide scalability.
Finance & Supply Chain Management is a single-tenant solution, meaning it operates on a dedicated environment for each client. The environment is specifically designed based on reported transaction volumes and user counts.
Business Central is a multi-tenant solution, where multiple companies share the same environment. BC clients benefit from cost advantages associated with this approach, and it works well for low to medium transaction volumes. However, in high-volume environments, this multi-tenant setup may have some limitations.
In these cases, Business Central clients can choose an On-Premises installation (hosted on Azure, as we recommend) where the partner can customize the environment to handle the specific volume requirements.
Current ERP Landscape
Expanding on the decision-making factors above, if your current business applications are augmented with multiple additional products or if your solution has undergone extensive modifications, there’s a good chance that Business Central and Finance & Supply Chain Management can provide you with added scope or features.
Clients of GP and NAV who heavily rely on add-on products to support core business functions might consider the upgrade as an opportunity to streamline and reduce the number of required apps or integrations.
For example, Finance & Supply Chain Management is equipped to meet the specific requirements of process manufacturers, while Business Central does not support process manufacturing. Therefore, a NAV client utilizing a third-party add-on to support their process manufacturing needs may find the integrated solution offered by Finance & Supply Chain Management more appealing.
What Next?
The ERP solution you choose now will place you on a platform that will continuously evolve well into the foreseeable future.
Will Business Central meet your needs in three years? What about five years from now? The concept behind these modern business applications is to eliminate the need for complex and lengthy future upgrades. Is this the right time to transition to Finance & Supply Chain Management, or does Business Central align better with your needs?
A growing organization using GP, NAV, or SL and experiencing rapid growth, alongside significant changes in their business model or industry, may want to consider Finance & Supply Chain Management as the logical next step.
Maximize Your ERP Investment With Sikich
We understand the significance of long-term value and the potential of cloud-based technology. By partnering with Sikich, you can make strategic technology decisions that align with your business goals and ensure a solid foundation for growth.
Our team can help you develop a clear implementation strategy tailored to your requirements, ensuring a seamless transition to the cloud. We’ll also stand by you every step of the way, monitoring and optimizing performance and ensuring that your cloud-based ERP system operates at its peak efficiency.
Trust Sikich to be your partner in maximizing your ERP investment and unlocking the long-term value of cloud-based technology. Reach out to a member of our team today to get started.
