The Total Economic Impact of Microsoft Dynamics 365 Finance

Posted on: February 2, 2023 | By: Guy Logan | Microsoft Dynamics AX/365, Microsoft Dynamics Manufacturing

A new generation of enterprise resource planning systems called digital operations platforms (DOPs) has emerged. These systems are focused on providing a better user experience and are designed to support digital business operations through AI-driven processes. A  Total Economic Impact (TEI) study was conducted to evaluate the potential financial benefits for companies that implement Microsoft Dynamics 365 Finance as their DOP. Continue reading this blog to learn about how Dynamics 365 Finance helps with staff productivity and legacy cost savings.

Dynamics 365 Finance allows companies to overcome the limitations of older, heavily customized ERP systems, by automating manual and tedious tasks for finance professionals. It also gives them access to real-time insights and the ability to adapt quickly to changing business needs, enabling them to keep up with the fast-paced digital business environment. This platform leads to increased productivity among finance and IT staff, as well as legacy cost savings.

Finance staff productivity improvements

Before implementing Dynamics 365 Finance, legacy ERP actively constrained the organization by requiring manual report creation and distribution. This meant that not only did financial processes require more headcount to support, but also that once reports were distributed, the information was often stale. Plus, process standardization was practically impossible because these organizations also had significantly different processes and systems in use depending on the region, location, and type of location (retail, office, and more).

Deploying Dynamics 365 Finance allowed the organizations to standardize and streamline financial processes across locations. At the same time, by leveraging real-time information and automation, finance teams were able to repurpose some team members to support higher-value-added work and avoid adding additional headcount through external hires.

The study found that the three-year present value of productivity improvements in finance staff was $2.30 million.

IT staff productivity improvements

Similarly, there were also IT staff productivity improvements as the organizations migrated from legacy, on-premises ERP solutions to the cloud-based ERP architecture of Dynamics 365 Finance. In most cases, the legacy solutions were in place for over a decade, leading to several challenges. Most notably, the ERP solutions had become highly customized over the years and required significant resources to administer and maintain functionality. This problem was particularly challenging because team members with expertise and knowledge of the various customizations had moved on to other roles or organizations. The lack of continuity made further customizations even more difficult and time-consuming.

By standardizing with Dynamics 365 Finance, the composite organization considerably reduced IT administrator and developer hours by deploying a solution that provided greater functionality with fewer customizations and was easier to support overall.

The study found that IT staff productivity improvements present value over three years was $402,870.

Legacy cost savings

Dynamics 365 Finance also allowed the organizations to realize savings by avoiding costs that would have been incurred with their legacy solutions. By preventing these legacy costs, the move to Dynamics 365 Finance reduced infrastructure expenditures, decommissioned redundant solutions across regions and lines of business, reduced financial auditing expenses, and lowered the cost to scale with demand. The avoidance of these legacy costs resulted in a projected present value savings of $3.52 million over three years.

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