A Number: Microsoft Dynamics up 19% (For What It's Worth)

A Number: Microsoft Dynamics up 19% (For What It's Worth)

Summary: It's only a number, and the best we're going to get. But buried in the news about Microsoft's earnings, and its Business Division's $3.


It's only a number, and the best we're going to get. But buried in the news about Microsoft's earnings, and its Business Division's $3.51 billion in revenues, was the fact that Dynamics was up 19%. True, this was qualified as customer billings, which doesn't say anything about whether Dynamics was profitable, or what geographies did well, or what the impact of the weak dollar was, or anything else. But it's a measure of growth, and one that looks a lot better than the Business Division's overall 5.5 percent decline. And, in the wake of SAP's 7.2 percent revenue growth in the same period, it looks like the much smaller Dynamics group is outpacing SAP. At least for now. 

That may give some meaning to SAP's mid-market push, as if further justification was needed for SAP to look to the mid-market for growth. SAP's growth guidance for the next year is north of 12 percent, which definitely means that some more mid-market revenues need to come its way. And, considering how relatively easy it is to dig into SAP's numbers -- while Microsoft continues to hide Dynamics inside the much bigger -- and apparently less successful -- Business Division, home to Office and the like -- I have to believe that it's really not fair to compare Dynamics to its much more transparent competitors. Much to the detriment of Dynamics. 

Of course, this opacity isn't new, and the problems it causes have been outlined here before. It's a pity that we can't see more of Dynamics success -- assuming that's what 19 percent really means -- or understand the details that would help everyone get a better view of where this market is going. But at least we can see some momentum, for what it's worth. Which is a whole lot better than nothing. 


Topic: SAP

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  • More to Do Right Direction

    This is good news for the ERP market which is badly in need of a challenge to the incumbent dinosaur SAP. Even the newer SAP versions look like they have just fallen off the back of a mainframe and have been hastily re-jigged for the mid-market. In my experience he TCO associated with a SAP solution is huge and consumes the vast portion of the annual IT budget ? consultancy is expensive and required for even minor configuration changes, existing in house programming skills are not usable as it a proprietary development language is used. Network and database independence come at a high price as expensive BASIS consultants must be employed to act as a layer between database administrators and network administrators. On top of this the user experience is not popular with the end users who are used to applications that have that Window?s sugar coated feel. If Microsoft?s Dynamics applications can succeed in addressing these factors and make ERP systems run and behave like any other application then the mid-market will be theirs and from that base they can launch an assault on the Enterprise. I?m not sure if this is achievable from their current code base as there are too many separate solutions/products in the Dynamics stable none of which have been extensively re-engineered by Microsoft. A good open source solution in this space could be interesting particularly if it was distributed by a commercial company who would provide support. Not really sure how profitable this would be but SAP are afraid of open source competition because of the disruption it could potentially cause.