CONVERGENCE - Microsoft moves closer to Dynamics platform

Connectivity is a key theme running through Microsoft's Dynamics development work as the vendor begins to meld its disparate business applications families into more of a single integrated platform.

Microsoft is due to release a flurry of announcements Monday at its Convergence 2007 conference in San Diego. "It will be the biggest news day we've ever had," said James Utzschneider, general manager of Dynamics marketing at Microsoft.

At the heart of the Dynamics announcements will be the vendor's attempts to improve different levels of connectivity, for instance, between employees and the business processes in the applications they use or better connecting a company via its software with its external community of customers, partners and suppliers.

One way of making it easier for staff to use the Dynamics ERP (enterprise resource planning) applications is to improve the user interface. Microsoft will be showing off its RoleTailored UI which brings the look-and-feel of its Windows Vista operating system and its Office 2007 desktop suite to Dynamics.

The intention is that RoleTailored will become the common user interface across all four of Microsoft's Dynamics families -- NAV, AX, GP and SL. Some of the work that went into RoleTailored was previously known by the Fenway code name.

The new UI will first appear in Dynamics NAV 5.0 due out later this month, then in Dynamics GP 10.0 and Dynamics SL 7, which are both on track to ship in June. Microsoft began shipping Dynamics AX 4.0 in June 2006 and expects to release Dynamics AX 5.0 in the first half of 2008.

Microsoft is adopting "a fairly conservative approach" to bringing its Dynamics offerings together by taking incremental steps to share code across the application families, Utzschneider said.

"What you're seeing Microsoft doing is starting to form a single platform in order to serve business applications' needs," said Yvonne Genovese, vice president and distinguished analyst at Gartner. The platform will consist of Dynamics NAV at the low end serving the needs of a maximum of 50 users and Dynamics AX at the high end, she added. Those two products will provide global functionality across all industries. At the same time, Microsoft will continue to come out with new versions of financial services-based Dynamics GP and project-based Dynamics SL, which will remain as products largely focused on the U.S. and English-speaking countries. Much of the intellectual property Microsoft will need for its Dynamics platform to meet the needs of services-based and project-based industries will come from the design in Dynamics GP, she added.

Microsoft mostly acquired its business software through the purchases of Great Plains Software and Navision completed in April 2001 and in July 2002 respectively. Genovese believes that Microsoft didn't appreciate the complexity of the business applications market at the time of the acquisitions and it's been a hard transition for the company. "They're just now growing up," she said. "They're in their late teenage years as a business applications company" versus older, more established players like SAP AG and Oracle Corp.

Genovese views the midmarket for business applications largely as a vendor invention. What she's hearing from customers of all sizes, including those with annual revenue in excess of US$2 billion, is that they're looking for business applications that don't require them to invest in their own IT development and that offer a broad range of functionality and have a predictable cost structure. "Microsoft is a prime candidate to be a leader in that market," she said, provided the company can execute on its strategy.

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Copyright © 2007 IDG Communications, Inc.