Microsoft continues cloud ERP push with Dynamics NAV update

Multitenancy and closer alignment with Office are among the new features on tap

Microsoft is preparing to roll out a new version of its Dynamics NAV ERP (enterprise resource planning) software that includes a key feature for cloud-based deployments as well as tighter integration with Office.

NAV 2013 R2 is set for release in October and will feature support for multitenancy, an architectural principle common to cloud software wherein customers share a single application instance with their respective data kept separate.

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This helps vendors run their operations at greater scale with less overhead, such as by applying patches and upgrades to all customers at the same time.

Dynamics has historically been sold through partners, who specialize in various industries and markets and tailor the software to customers' needs.

In June, Microsoft announced support for NAV deployments on its Windows Azure cloud platform. Partners are continuing to directly sell NAV, with Azure now serving as an additional hosting option.

NAV 2013 R2 will also include tools designed to support "large-scale hosting" of the applications, according to an official blog post this week by Paul White, senior director of Dynamics ERP.

Overall, the multitenancy option is "a good thing for partners," as it will significantly lower their hosting costs, said analyst Frank Scavo, managing partner of IT consulting firm Strativa. Customers could also benefit from faster deployments, he said.

But NAV customers considering an Azure or traditionally hosted deployment must focus on whether their partner has the experience necessary to deliver day-to-day, ongoing support of the ERP system, Scavo said. Many Dynamics partners have been focused on periodic implementation services and upgrades, and may not have that kind of know-how, he added.

Meanwhile, another new feature coming in NAV 2013 R2 is the ability to deploy the application "to on-premises and cloud-based SharePoint sites, with single sign on and a consistent look and feel across the Microsoft Dynamics NAV Web client and Office 365," White wrote. NAV processes can be combined with SharePoint workflows and Web parts, he added.

Other enhancements on the way include improved tools for cash management, as well as a "restyled" user interface "aligned with Office 365," White wrote.

Microsoft also offers its Dynamics GP ERP software, which is aimed at smaller companies than those in NAV's target market, on Azure. It's expected to add Azure support for Dynamics AX, its high-end ERP product, with early-adopter programs slated to begin next year.

Dynamics as a whole has enjoyed special status within Microsoft, as it's seen as a conduit for the company to sell its other software products into companies. Sales discussions around Dynamics also tend to involve CEOs, chief marketing officers and other high-level executives, rather than just IT staffers.

Outgoing Microsoft CEO Steve Ballmer kept Dynamics separate from his recently announced company restructuring plan, saying it represented a "significant opportunity."

That wording suggested Ballmer intended to keep Dynamics for the long term, but now that he is leaving speculation may resume that Microsoft will spin off some or all of the business as the company focuses on devices and services.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

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