MUFI Rating & Risk – Microsoft Dynamics AX
MUFI: Maintainability, Usability, Functionality, Implement ability
Vendor: Microsoft (Select For Vendor Profile)
Microsoft has several ERP systems Microsoft Dynamics SL, Microsoft Dynamics NAV, Microsoft Dynamics GP with Microsoft Dynamics AX being the largest. Microsoft Dynamics AX is the premium version of Microsoft’s ERP suite.
Microsoft Dynamics AX is a composite of some acquisitions – including most prominently Great Plains Software. Microsoft has been one of the fastest growing ERP systems in the past few years. A major boost to Microsoft has been its strategy of allowing customers just to buy and pay for components. This is the opposite strategy followed by tier 1 ERP vendors that require the purchase of the entire suite. In fact, this is also quite beneficial for customers as contrary to popular belief; not all companies have implemented ERP. Many ERP proponents have proposed that any company that has not implemented ERP systems needs to – however, we believe that to be untrue. Furthermore, many companies that have ERP systems have implemented only certain modules, and within these modules only certain functionality. Microsoft Dynamics AX has an abysmal user satisfaction level.
Like NetSuite, Microsoft Dynamics AX is a faux ERP system. However, unlike NetSuite, its strength is not its financial system. All ERP systems have their strengths and weaknesses, but Microsoft Dynamics AX has been stitched together from whatever applications Microsoft was able to acquire. Because of this, it is the most uneven application we have ever tested. For instance, Microsoft Dynamics is weak in many supply chain functions even though it is not a “finance heavy” ERP system. On the other hand is curiously strong in service parts management. This is simply a consequence of whom Microsoft acquired. Microsoft Dynamics AX is marketed as an ERP system, but it has very weak supply chain functionality.
This is not as negative as it might appear, as in our view it is better not to have the functionality – if it is merely mediocre because then one can purchase a best of breed application and connect it to the “ERP,” system. However, the problem is that many companies that purchase Microsoft Dynamics AX think that this functionality is at least somewhat capable. In our view, it makes much more sense to buy a stand-alone financial system, and then connect best of breed applications to it, rather than to buy an ERP system which is missing so many components of what makes up and ERP.
Something, which should be a concern to anyone thinking of the application, is that Microsoft has not done very much with Dynamics AX aside from cobbling together its acquisitions. This brings up the question of whether they will add very much to the application in the future. We think its unlikely that they will.
Our overall observation is that it is difficult to see how Microsoft Dynamics AX would be anywhere near as popular as it is if it was not associated with Microsoft. Microsoft Dynamics AX has lived off of its integration with other Microsoft products and the fact its account managers can pitch the product to most Microsoft accounts. However, as usual, Microsoft has a lagging product. Microsoft Dynamics AX is also because of its unevenness a confusing product. If your company works in service parts, AX may be a desirable purchased because this functionality is strong. However it is unlikely improvements in AX will come from internal development, but rather from future software acquisitions. However, it’s not clear to us that an ERP system that makes sense can be composed of software acquisitions.
Of course, purchasing Microsoft Dynamics AX also means dealing with the Microsoft “monster” (even though their Microsoft Dynamics website looks so soft and fuzzy) while accessing an application with limited upside.
Microsoft’s Dynamics website was so soft and filled with such soft figures, we – for a moment forgot how Microsoft frequently employs brass knuckle tactics with its customers and competitors.
AX has positive buzz because it has been growing well – however, this growth in sales does not appear to be driven by the quality of the product, but instead is due to a change in marketing and sales strategy where Microsoft sales reps are empowered to sell the usage of just portions of the software.
As AX is not a complete ERP solution or offers uneven coverage, it is likely that many of AX’s sales are destined to be at clients that intend to bring up just a small portion of the functionality. We would recommend against the purchase of Microsoft Dynamics AX. It is the weakest of the “new” ERP systems, its user and buyer satisfaction is as bad as it gets, and the fact it is produced by Microsoft does not even provide the illusion of integration that comes when products are purchased from a major vendor.
Microsoft Dynamics AX is one of the few ERP applications that provide a trial.
All scores out of a possible 10.
Vendor and Application Risk
Microsoft Dynamics AX is one of the simpler ERP implementations. Microsoft has created straightforward configuration screens, a reasonably good user interface and its shortage of functionality means there are far fewer options and alternatives to present to a client than with many other ERP applications.
Likelihood of Implementation Success
This accounts for both the application and vendor-specific risk. In our formula, the total implementation risk is application + vendor + buyer risk. The buyer specific risk could increase or decrease this overall likelihood and adjust the values that you see below.
Risk Management Approach
Two significant issues stick out concerning Microsoft Dynamics AX implementations – one is the limited functionality that Microsoft Dynamics AX has to offer, along with the low quality of information provided by Microsoft regarding their applications. This can put the implementation on the high-risk pathway if expectations are not brought down to what Microsoft Dynamics AX is capable of on an implementation after the sales process is complete.
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Software Selection Book
Enterprise Software Selection: How to Pinpoint the Perfect Software Solution Using Multiple Sources of Information
What the Book Covers
Essential reading for success in your next software selection and implementation.
Software selection is the most important task in a software implementation project, as it is your best (if not only) opportunity to make sure that the right software—the software that matches the business requirements—is being implemented. Choosing the software that is the best fit clears the way for a successful implementation, yet software selection is often fraught with issues and many companies do not end up with the best software for their needs. However, the process can be greatly simplified by addressing the information sources that influence software selection. This book can be used for any enterprise software selection, including ERP software selection.
This book is a how-to guide for improving the software selection process and is formulated around the idea that—much like purchasing decisions for consumer products—the end user and those with the domain expertise must be included. In addition to providing hints for refining the software selection process, this book delves into the often-overlooked topic of how consulting and IT analyst firms influence the purchasing decision, and gives the reader an insider’s understanding of the enterprise software market.
By reading this book you will:
- Learn how to apply a scientific approach to the software selection process.
- Interpret vendor-supplied information to your best advantage. This is generally left out of books on software selection. However, consulting companies and IT analysts like Gartner have very specific biases. Gartner is paid directly by software vendors — a fact they make every attempt not to disclose while consulting companies only recommend software for vendors that give them the consulting business. Consulting companies all have an enormous financial bias that prevents them from offering honest advice — and this is part of their business model.
- Understand what motivates a software vendor.
- Learn how the institutional structure and biases of consulting firms affect the advice they give you, and understand how to properly interpret information from consulting companies.
- Make vendor demos work to your benefit.
- Know the right questions to ask on topics such as integration with existing software, cloud versus on-premise vendors, and client references.
- Differentiate what is important to know about software for improved “implement-ability” versus what the vendor thinks is important for improved “sell-ability.”
- Better manage your software selection projects to ensure smoother implementations.
- Chapter 1: Introduction to Software Selection
- Chapter 2: Understanding the Enterprise Software Market
- Chapter 3: Software Sell-ability versus Implement-ability
- Chapter 4: How to Use Consulting Advice on Software Selection
- Chapter 5: How to Use the Reports of Analyst Firms Like Gartner
- Chapter 6: How to Use Information Provided by Vendors
- Chapter 7: How to Manage the Software Selection Process