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Steve reads his Blog
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Welcome to the ”Steve reads his posts podcast”. For those of you who are too busy, or too lazy, to actually read my posts, I have taken on the huge effort of reading them to you. Enjoy.
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Welcome to the ”Steve reads his posts podcast”. For those of you who are too busy, or too lazy, to actually read my posts, I have taken on the huge effort of reading them to you. Enjoy.
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Steve reads his Blog
My thoughts on the current state of this competitive battle.
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Steve reads his Blog
1 Steve has a Fifth Annual Chat with Charles Lamanna 48:48
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Play Later Play Later Lists Like LikedI caught Charles the other day for my fifth annual Chat. We talked about many things fresh off of Ignite—copilots, of course, but also Project Sophia and his thoughts about AGI.
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1 Are You Straddling Outbound and Real-Time Marketing? 5:52
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Play Later Play Later Lists Like LikedAre You Straddling Outbound and Real-Time Marketing? Listen to this.
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Steve reads his Blog
Part 7, the last in my series of Sally and Power Platform
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Part 6 in my series of Sally and Power Platform
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Part 5 in my series of Sally and Power Platform
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Part 4 in my series of Sally and Power Platform
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Part 3 in my series of Sally and Power Platform
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Part 2 in my series of Sally and Power Platform
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1 Sally in HR has a Business Problem - Part 1 10:50
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Play Later Play Later Lists Like LikedIn this mini-series, we will follow Sally from HR as she uses the Microsoft Power Platform to solve business problems.
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For as long as I have been in this business, about 25 years now, costs for clients have always been a wild card.
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1 Here’s why customers should pay for more for customizations! 8:55
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1 How to Write a Modern RFP for CRM Implementation 9:27
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Play Later Play Later Lists Like LikedHow do you write an RFP for Dynamics 365 or Power Platform Services? You don't. You can search for "How to write a CRM RFP?" or "Template for CRM RFP", or "RFP for Dynamics 365", or similar, and what you will find are a lot of RFP examples that failed to generate responses.
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It has been exactly one year since we signed our first customer up for “The Works from Forceworks”
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When Microsoft introduced the Power Platform as a "Citizen-Friendly" set of tools for non-technical business users to create apps to solve business challenges, it seemed a worthy endeavor. Well, enough time has passed to assess the outcome. Those who jumped in with both feet now have a mountain of shitty little apps. Those who watched from the sidelines decided, "We don't need that!" So is that the end of the tale? Let's see. The First Mistake To enable broad and rapid adoption of the Power Platform, Microsoft decided to add a "seeded" Power Apps capability to all Microsoft 365 licenses. Thus instantly putting a version of this technology into millions of "citizens" hands. While IT could turn this "off", it was "on" by default. Microsoft knew that no IT Admin would ever enable it if it were the other way around. This led to many citizens seizing the opportunity to replace their shitty little Excel spreadsheets with a slightly less shitty app. Excel was the original Citizen tool, and many organizations have a ton of Excel spreadsheets floating around, which are now slowly but surely being replaced with shitty Power Apps built by people who not only don't know what they are doing but don't know that there is anything beyond those seeded capabilities. The Second Mistake Once IT figured out what was happening, many flipped the switch stopping this unchecked motion. In response to alleviate their concerns, Microsoft launched the "Center of Excellence" CoE. A tool that could wrangle this proliferation of shitty apps to be under IT's control again. CoE was a solution to a Microsoft-created problem. Now IT could see all of the shitty apps that had been built, including apps that never got used, multiple apps trying to solve the same problems, apps connecting to external sources, apps exposing internal confidential sources, and users having access to apps they shouldn't. There are few things more fun than watching the faces of fear of IT when a CoE lights up. Going back to the Fork I have written before about the poor citizen, oblivious to anything beyond the seeded capabilities, building some contorted solution only to months later learn there were better options. They unknowingly took a fork, unaware there was more than one fork to take. Their anger towards Microsoft is deserved. But they are not the only ones to take the wrong fork; Microsoft also did. Microsoft determined at the beginning that Joe NoNothing building his own app to solve his own problem was the best path. With rare exceptions, disaster ensued, or a least a lot of wasted time. Recognizing the obvious, that no organization wants a thousand shitty little apps, Microsoft took a pivot with an emphasis on a new idea, "Fusion Teams". Pair Joe NoNothing with Sally KnowsAlot and Bob ProDev... this is a "Fusion Team". Now instead of a shitty little app that does not do very much, you can expect a nice little app that does not do very much. Again, even the Fusion Team has taken the wrong fork. What Other Fork is There? There is another fork, but you can't see it from the seeded Power Apps. Had Microsoft called the seeded Power Apps something like Power Apps Lite, you might have been given a clue, but inexplicably, they chose not to. So you are left thinking that you have seen Power Apps and are justifiably unimpressed. But there is another "Power Apps" in the Power Platform. One that is much more capable and runs on top of a relational database called Dataverse instead of a SharePoint list or Excel spreadsheet. Why did you not know about this? Why would you? In the time you have been struggling to create a Canvas app, you could have built an entire, bulletproof solution to your problem. A solution that could be easily extended also to solve related problems. What's the Catch? Ok, you got me; the catch is that the "real" Power Platform is not included with your Microsoft 365 license. It will add either $5 or $20 to your monthly cost per app user. Still pretty cheap to actually "solve" a problem rather than just canvas over it with shit. The Fork Microsoft Should Have Created I am sure some inside of Microsoft would agree that mistakes were made. Had they forgone the Citizen path and instead emphasized the Rapid Development low-code Power Platform as a way to solve mission-critical business challenges at a much lower cost than ever before in history, we would all be in a different place today. Fusion Teams was the one bright spot in this series of missteps. What about Citizens? Don't Citizens already have a job? Why are they wasting time pretending to be app developers? As an organization, your cost to have complex mission-critical applications built by professionals is a fraction of what it was only a few years ago. Seriously, drop a zero off of the end of what you previously paid! Do you really need to reduce those cost savings even further by having Sally build some shitty app on her own? Some of you reading this are already sitting on a pile of shitty apps and can see that the "savings" were never real. So What is the Power Platform... Really? I'm glad you finally asked! The Power Platform is a suite of capabilities, including Apps, Automation, ChatBots, Webpages, and AI. Individually, each component is pretty cool, but when combined, there are few business challenges that cannot be solved. Forget about your shitty little "Time Off" app. I am talking about enterprise-grade; run your entire organization level stuff. That $5-$20 is starting to sound pretty cheap now, isn't it? Why hasn't anybody told you about this? It's because of that $5-$20 thing. Microsoft and most partners would actually prefer that you buy their first-party business applications for a buttload more money. If word got out that instead of customizing Dynamics 365 Sales @ $95+/user, you could spend the same amount customizing on the Power Platform and end up with the same thing at a fraction of the cost... well, that would not be good for those who sell the $95+ apps. Prove It! Ok, here are some examples of some of our clients. An NFT company that sold $90 million worth of NFT tokens on its first day manages the entire process on the Power Platform with integration directly to the blockchain. A Solar contractor runs their entire end-to-end business, from web prospects to permitting to construction and long-term maintenance agreements on the Power Platform. An Insurance Brokerage generates and tracks thousands of quotes daily on the Power Platform. A Mega-Church manages hundreds of monthly events, including event creation, promotion, and kiosk-based check-in for thousands of constituents on the Power Platform. An Opportunistic Investment firm created an in-house deep financial research solution on the Power Platform. A Petroleum Distributor and Convenience store operator with thousands of locations runs their organization on the Power Platform. Still think the Power Platform is about shitty little apps built by Joe NoNothing?…
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1 Microsoft is Infected with AI as Copilots Consume all of the Oxygen 9:45
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This was my fifth chat with Charles Lamanna.
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I had a chance to sneak up on Vahe Torossian , a Microsoft Corporate Vice President and the man in charge of Sales for Microsoft Business Applications. While Vahe has been with Microsoft for 30 years, many of you may not know him, so I wanted to fix that. Vahe is no ordinary Seller; he’s the “Top” guy who sets the sales strategy and motions for the entire global team. Vahe is also the guy who runs the really big enterprise customer meetings, and he’s super-friendly, as you would expect for the Chief Rainmaker. We covered a lot of ground in this one, so enjoy! Transcript Below: Vahe: Hey, Vahe Torossian speaking. Steve: Vahe, Steve Mordue, how are you? Vahe: Hey Steve. In fairness let’s say Charles mentioned that somehow you were going to call me. I didn’t know when, but it’s great to talk to you. Steve: After I interviewed him, I asked him who would be a good person to talk to? And he dropped your name. So it doesn’t surprise me that he gave you a little heads up. Have you got a few minutes to chat? Vahe: Yeah, of course. Thanks Steve. Steve: Oh, perfect, perfect. So before we get into it, maybe we can tell the listeners a little bit about what your role is. I know you’ve been at Microsoft forever, I think like 30 years or something like that, and you’ve held a lot of different positions. But now you’re in the business application space and that’s been fairly recent. So there’s probably a lot of folks that might not be familiar with you, who should be. Vahe: Oh yeah, thanks Steve. You’re right. I’ve been celebrating my 30 years anniversary at Microsoft in April in 2022. I actually took the helm of the Biz Apps sales organization globally in late 2020. So basically I took my one way ticket to Redmond in December 2020. And the plane was almost empty, it was during the pandemic. And it was kind of a strange feeling for someone who has been traveling so much in the past. And of course, let’s say I came with the lens of the business application, of course. Having led let’s say Western Europe in my past role, having all the businesses of Microsoft. And I think Western Europe was quite successful on Biz Apps, our trajectory growth. And I guess that was also in fact the good match to some degree to try to take it at the global level. Steve: So is it a little easier to think about a smaller segment of the product mix, now really being able to focus like a business application? So I think before you were looking over all sorts of different things, weren’t you? Vahe: Yeah, actually it’s a great question. Because I think it’s very different way of looking at the business. When you are, let’s say almost you are the CEO of Microsoft in the countries that you are, let’s say leading. You have all the levers to engage customers, partners, government, in different circumstances. And you try to leverage as much as you can the portfolio that you have to maximize the value. In the context of let’s say the business application. I think it was, the interesting bet to some degree Steve, was to say, Hey, this has been a portfolio at Microsoft, whether you call it Dynamics 365 or Dynamics only as a brand in the past. And if you go back 20 years, let’s say almost, with the Navision and Axapta, and Solomon Software and Great Plains. All these stories, all these product came together. And 20 years later, I think it has been part of a portfolio somewhere. Vahe: And you had almost what I will call the strong, let’s say, portfolio of Microsoft, the platform, the modern workplace and environment. And I felt the work that James Phillips in the past, and with Alyssa, and Charles, and Amy here now on the marketing side. Have been a strong inflection point to bring together both the technology in the cloud environment. But at the same time, a market environment that requires very different, let’s say tools to make the most of this transformation. And I felt that there’s one piece at Microsoft that requires a huge catalyst leveraging the innovation. But responding as much as we can to what the customer need or even don’t know yet what they need. And I think that’s what I think to me was almost a bet. It’s almost like all of a sudden you move to the little dog, if I may say. But with a huge potential of transforming something with great asset for Microsoft, and the customers and partners. Steve: Well I have to say, having been involved with Microsoft for a while, we have a phrase over here called redheaded stepchild, which is kind of what Dynamics was for many, many years. It was off campus, it was just this thing out there and under Satya, when Satya came in, he’s the first one that I think came into the position that recognized this should be another leg on the stool, not some remote thing out there. And I think that’s made a huge. Difference because I was involved in the years before Satya with business applications and they were not just something over here on the back shelf, and now they’re right front and center. I think that between Dynamics and what’s happened with the power platform, cloud in general. Microsoft’s ability to get into and help customers is massively different than it used to be. And in your role now, you’re dealing with a lot different type of customer. You’re talking about Office 365 or Azure, you’re dealing with IT. And now you’re mostly dealing with business users. It’s a completely different audience you’re having to work with today, isn’t it? Vahe: Absolutely. I think also you’re right since Satya took the helm of the company, to some degree you of course we have seen how we tackle the cloud computing hyper-scale environment. But at the same time, in fact what happened with the Covid in the last two years, have seen an acceleration of what we call in the past, the productivity tools to become more and more collaboration environment. And from almost an application or a set of application, it became more and more a platform on its own. And so it’s almost like when you think about where we are today and we were talking about the Covid, I don’t think the Covid is yet over fully everywhere. But now everybody’s talking about recession, right? And there’s no one headline that you look, you say, oh my goodness, what’s going to happen? Which just means in terms of planning for 22, 23. Vahe: So I think the assets that is now quite unique to some degree, or differentiated as you said, between the Dynamics 365 platform components and the Power Platform, it’s almost bringing together. But I think, I don’t remember Steve, in a few years back, I think Satya was talking about the mobility of the experience. And that was more from a device perspective initially. But actually what you see now is that with Teams as a platform, the system of productivity almost connect with the system of record more and more. And it’s re-transforming the way you are thinking. It’s almost like, you think about, you don’t have to go to a CRM environment or ERP environment to get access to the data. It’s almost like wherever you work, if you use an Excel or if you use Teams or whatever, you get access naturally, almost intuitively to your data set. And the data set are that’s almost fulfilled naturally. And so we have no additional task. Vahe: And so I think that’s the transformation world in which we are. Which connects cheaper well. We almost do more with less, right? And that’s going to be almost the conversation we’re going to have in the coming month. And it started already with many customers and partners. How we can optimize the assets that they have, how they can let’s say increase the deep provisioning of some assets that they have. They are paying too much to concentrate a bit more, to get more agility. And I think this is where also, from a partner perspective, Steve, I see a lot of potential. You are referring to Power Platform, it’s fascinating to see what it was in the very beginning, this notion of citizens developer, what does it mean? Vahe: People didn’t know exactly what it is, we’re quite afraid to touch it. But now when you see the shortage of developers in the market in general. And how you can make the most of some absolutely topnotch people who are not developer, touching the last mile execution challenges. Have been facing crazy environment and situation that they say, I can’t believe how my IT guide doesn’t solve these things. I’ve been telling them the customer pain point for so many years. And now with some, let’s say [inaudible 00:08:45] place, let’s say available for them, along with some let’s say technical assets, you can really make the magic in the very, very, very time. Steve: Charles came up with a term on the fly, ambient CRM. Kind of where we’re heading here when you talk about things like Viva Sales and some of these pieces that are really wiring all these components together. Covid was a terrible thing, but it certainly was a perfect storm for pushing the technology forward into a place that it’s been fighting to get to, it’s really been fighting to get to that point. And Teams was a great product. But certainly Covid created the perfect environment where Teams made insane sense for companies that were maybe just thinking about it or dabbling with it, and suddenly they’re all diving into it. And you guys of course poured the investment on top of that. And I think that the silver lining of Covid, for technology, is how far it really allowed it to advance in that period of time. Maybe we just need a pandemic every five years to push a technology forward. I don’t know. Vahe: No, but I have to say that even in my previous role when I was running Western Europe. Even the most skeptical people in regard to the cloud or the transition to a cloud environment. Having the one that rushed in the first, almost to a cloud environment, once the pandemic has been a bit of a real situation to face, and to drive the economy or the public services let’s say on. So I think you’re right, so you don’t want to wish for another pandemic or whatever, but it has been absolutely a forcing function in many domains. And that’s true. Steve: I think the challenge we have is particularly in the business application space. You guys have launched so many things in such a short period of time. And as you mentioned before, Power Apps, people picking it with a stick, they don’t even know what it is. And there’s also this first mover fear, I think. Microsoft has been, in my mind, kind of famous for coming to the game late and then just taking over the game. We were very late to the cloud, but once we got there we just took over the cloud, and it seems to be a pattern. But when you look back at the early days of cloud before you guys stepped into it, it was wild west. And all sorts of challenges with cloud. And I think that that gave a lot of people fear about, I remember I moved into cloud early and we got destroyed. Steve: And so I think there’s a lot of folks out there, just from a technology standpoint, that have gotten their hands burnt by moving too quickly. And we’re at that point with the platform and dynamics, where these are not new anymore. Relatively in history, they’re new. But they’re not new products and they’re not built by some garage shop somewhere with a couple of developers. This is what 15,000 people building this stuff back there. This is professionally built, well built stuff, that is ready for prime time. So the first movers have already come through and they all survived. So I really feel like we’re at that point where it should just take off now, it should just absolutely take off. And I’m sure you guys are seeing this. Vahe: Yeah. And Steve, I think one thing also is that you’re right, there’s a usual thing about let’s say the first mover advantage. At the same time from a customer perspective, you don’t want to be the Guinea pig, right? On any situation, especially from the technology standpoint. I think that increasingly what I see in the conversation is that there’s almost now, because of the quality of the native integration of the several different applications. Whether you are in the customer experience environment, on the service side, on the supply chain, on the finance or the local no code or app. All these components are absolutely connected to each other. And basically whether you have Teams as a platform in your company, or Azure in environment, all these component are connected very, very easily to each other. Vahe: And so I would say that the beauty of it now is that you have all almost the notion of marginal cost. If you really want to leverage many of the assets that we can bring, and you don’t have to take all of them at once, of course it has to be matching what you need now. But the right is that, let’s say there’s an almost fully integrated benefit all the connectors with the rest of the world outside of Microsoft environment, which is a great value for the partners, ISV and [inaudible 00:13:58], and at the same time to the customers. Who think now, hey I should do more with less. How should I think about my investments for the next, let’s say five years? Most of the customers now are really thinking about the longer term relationship. And defining what’s the value SLA almost that you’re expecting both from the partner of the vendor and the vendor itself. Vahe: And so it’s almost like, you remember when we transition from a world of build revenue and licensing, to now more consumption and usage. It’s almost the user and consumption discussion is a forcing function about the customer success, how we align on the same definition of the customer success. And what’s the time to value that you committed? What are the key milestones, in full transparency, that you need to bring in? And I think that’s where we are now. And because Microsoft, I think overall as a company, have been increasing tremendously the level of trust. From the security standpoint, the compliance components, and so on, and the scalability. Vahe: I think that’s the great leverage for us now in terms of the conversation and making sure that the customers are getting the value that we have been selling to them. How we show how much skin in the game we have to make them successful. And then it’s a flying wheel. It’s almost like the innovation will help you to bring new things, respond, anticipate, take the feedback of the customer to the engineering, develop new stuff quickly to the market. So I think it’s what we are heading to now, Steve. And I think from a partner perspective you might even see and feel it, right, more and more. Steve: Oh yeah, I mean I think the sales motion has changed completely. Only a few years ago we go into a customer and try and convince them to replace Salesforce with Dynamics. And they’d say no, and we were done. We’d say okay, well we’ll come back in a couple years and ask again. We had nothing else to sell them. And now today, I mean if they have Salesforce, fine that’s great, keep Salesforce, let’s add some things around it. Salesforce will work with Viva Sales, Salesforce will work with Power Platform. Steve: There’s so many doors now, I think, for a seller to be able to get into a customer and solve problems for that customer without having to do the one big yank and replace. Which is very difficult to do, it’s difficult to do on opposite as well. I mean once a customer gets a big solution like Salesforce or Dynamics 365 installed, those are very difficult to uproot, it takes a very long time. And you guys have created now, this product mix, where we don’t have to uproot something to sell that customer and to get engaged with that customer. We can go all over that business without having to uproot something. And I think that’s huge. Vahe: I agree Steve. And I think that it’s almost this notion of rip and replace type of strategy, right? In some cases it works because this is what the customer wants. They are fed up about let’s say competitive environment that didn’t deliver on the expectation. And we should be ready to cope with that and respond, and we have a lot of this. But at the same time as you said, what we call the strategy of having a hub and spoke, let’s say, almost environment, gives us for every line of business. That we decided as a company to go and have a significant acceleration of growth and market share, is very much to give that option to say, Hey, you know what, Mr. Customer, Mrs. Customer, you decide to be on that type of environment, who we are to ask you to change? Vahe: If you are happy that’s fine. But what we can bring you is almost to enhance what you have with some component that absolutely will be transparently integrated to what you’re using. And it’s a great circuit, an additional circuit for the partner, it’s a great value for the customer. We don’t feel harassed to change something because we know the cost of transitioning from one to another one. And then it’s up to us to demonstrate the value we can bring and eventually we can take from there to the next level in the future. Steve: It’s got to put some pressure on the competitors also. I if think of, I might just use Salesforce because they’ve always been the big competitor. I’m sure that they were confident sitting there at their large customer when all we had was trying to replace their instance that was going to be difficult to do and then we’d go away and they didn’t have to worry about us. Now we’re coming in and we’re circling around, and we’re solving problems in this department, and we’re building apps in this department, and we’re literally bolting into Salesforce. And one potential outcome is that the customer decides over time that wow, all of this Microsoft stuff that we’ve brought in works really, really well. Steve: That’s gotta put some pressure on the incumbent big application in there that hey, you’re surrounded by a bunch of stuff the customer is very happy with, you better make sure they’re happy with your stuff and they don’t reach that point. Cause like you say, oftentimes when you see those rip and replace, it’s because the product, or the company, or something hasn’t met the expectation. And to be fair, that could actually happen with any of us, right? It has a lot to do with implementation, design, how thing was put together. Less to do with the application itself, that could happen to any vendor. But certainly raises the bar to some of these competitors when they’re surrounded by well performing Microsoft products that are satisfying customers. Would you think? Vahe: Yes. Absolutely. And that’s why there’s a continuity between what we sell, how we sell, to who we sell, and how we drive the implementation. It’s an ongoing wheel that is a very different mindset that we all learn in the transition to the cloud, let’s say, environment. But absolutely. I think it’s a good forcing function to raise the bar to some degree, raise the bar for the benefit of the customer. You mentioned the competitiveness of what this type of hub and spoke strategy can create. You’re right. But in the end, the biggest, let’s say winner, will be the customer, right? Which I think is always and should always be the north star for us and our partners. Vahe: And I would say the relevance of the innovation should be in fact the pressure that we put to each other to make sure that say we listen carefully to what the customer is facing as a challenge, but potentially to translate their current challenge into the future challenge, to push them also to think differently. Because I think the notion of rip and replace [inaudible 00:21:06] One of the thing was, I don’t know if you remember that the initial issue and worry was that people were saying Oh, we are moving to the cloud, therefore we are transforming. Well it was not that tried and true. People were just keeping the same processes in the cloud and the one that they had on premise. Which was not benefiting at all of the scalability and the agility of the cloud environment. Yeah, you remember that right? Yeah. Steve: They just changed the way they were paying for it. Vahe: Absolutely. Absolutely. So I think that’s what we have seen on this application modernization, on some of the enterprise wide innovation also opportunities that we had discussed, is how much you can really say, in this new world of competitiveness, of un-expected challenges. How you can, let’s say, keep your applications fitting always in fact proactively the challenges that you’re going to have too. As opposed to keep going with a quite heavy code to maintain, with people who leave that cost you a fortune to maintain. So I think this agility that the power apps, [inaudible 00:22:22] to made, have been bringing I think is the reason why we have seen this huge acceleration of growth, which is today is six, seven times faster than the market growth of local no code. Vahe: So I think it’s a great, let’s say indication, of what people start to realize. And I think in the conversation that you had with Charles when he was referring to, hey some of the AI capability have been slower to be picked up by the vast majority of customers. And it’s true because there’s a level of, let’s say, can I trust this thing? Am I going to lose completely ground and control of what I’m doing? All these natural thing. I think as we bring more and more, let’s say tools, are manageable. The Power Platform environment, or let’s say the device sales capability on top of the teams or Salesforce environment. That people will start to test this. Vahe: And I think we’re going to be more and more advocate about Hey, what are the benefits of the organization that are using this technology and how we can trust them lean forward. And I think Charles was referring to our digital sellers. Their daily life is very much, let’s say, using all these AI lead capabilities in terms of reporting, in terms of let’s say incident management, in terms of even coaching for themselves to do a better call next time, is just fascinating to see. Maybe we should even do a kind of, let’s say talk on this, once we have a bit more, let’s say after the GA, maybe a few months after, we should have, let’s say what the key learnings and [inaudible 00:24:00] from a customer standpoint. Steve: Yeah, it always makes a customer confident when they know that the vendor is using the product that they’re trying to sell them. It’s interesting, everything moving to a subscription has changed kind of the mindset, not just of you guys obviously, where there’s no big sale. There’s a sale of a big subscription, the revenue of which will come over a long period of time. But the customer has this option every month to say, you know what, I’m not happy, you’re not solving my problem. In the old days they were kind of stuck, they bought all this stuff and they had to make it work. Now they don’t have to make it work, we have to make it work, we have to keep them happy enough. Steve: We recently launched a professional services on a subscription, which is an interesting model, that I lay awake at night thinking about that same thing. That before a customer would pay you a bunch of money to a bunch of stuff and now they’re paying you a little bit of money every month for as long as you keep them happy. And this bar of, I mean we’ve always wanted to keep customers happy. But it’s never had the impact or importance that it does when you’re on a subscription with that customer who can just any time say, “I’m not happy, goodbye.” It raises the bar I think for you guys to have to continuously innovate, what do you done for me lately? You got to continuously innovate and bring new things. And you’ve got more motivation probably than the company’s ever had in history because of the subscription model. Do you feel that internally? Vahe: Yes, yes. As I said, it has been a great enabler to raise the bar. And it’s almost like you know can have a beautiful slide deck and saying the right things, but the execution doesn’t match what you are saying somehow, that you don’t walk the talk. I think you could have been in that situation in a kind of on-premise environment. I think the cloud has been a forcing function to say, hey you know what, you can claim you are customer success, or you are customer first, or you are customer obsessed. But the reality is that if you don’t deliver the service properly, if you are not as responsive timely, if you’re not proactive, customer will say enough is enough, I can stop my subscription. Steve: I have options. Vahe: I have options. So I think it’s a good hygiene, how it makes you having an embracing habits, that I would say are the natural thing when you engage with customer. But I think it’s almost, let’s say, for the one who might have forgotten that basics, it has been a great, let’s say, opportunity to bring back the roots of what is it to satisfy a customer, right? And I think that’s what the cloud licensing model helped put together. And I think there are still always room for improvement. Vahe: And similarly I would say, what you have seen on the collaborative applications, what we have seen on the low-code, no-code, you are going to see it now, also I would say on the supply chain environment, which is shipper, shipper at stress because of what we have seen on the Covid, but also in fact on the geopolitical aspect and some of the recession discussion. And also, on the overall, what I would say the contact center in our environment at large. How this world is going to change is going to be led a lot by the capability that technology can bring, and the ability to listen carefully to the strategies and the challenges of the corporation that are involved in. So it’s quite exciting actually. Steve: I don’t get involved a lot with the call center operations. But I picture the old call center is this massive building full of cubicles and people with headphones. And I picture that now that most of those people are probably working remote. A call center now could operate at my desk, just about, and have thousands of people all working from their home. So, that whole industry feels like it’s changed significantly. And yes, I’m sure they’re starving for the technology that fits the model that they’re being pushed to adopt. Vahe: Yeah, yeah absolutely. I mean it’s interesting, if you summarize some of the business challenges or the things that are coming from multiple conversation. We had the nuanced [inaudible 00:29:04] a few months back. And so it’s almost the first fiscal year where we’re going to be able to strategize, operate together as one organization. And it’s great because somehow you take their own experience in terms of conversational AI and what they have been leading in for many years. And at the same time you hear both, let’s say, the customer feedback when it comes to, as you said, the traditional contact center or call center evolution. How to translate this into a modern service experience, right? Vahe: And how AI can contribute to that on the seamless integrated way. How to think about customer retention in this world where people are a bit more struggling with their bottom line. How to protect the customer privacy as well. Because you talk about voice capability and recording, but how you cope with the privacy and the security during this service journey. So all these are absolutely great opportunities for us to combine what we’re hearing, the technology and the acquisition that we did a few months back, to put that into a great component. And I would say the data analytics that the power Platform Power BI gives us on the back end, is going to be a great platform for us again to differentiate from the rest of the world. Steve: Well and it’ll also help kind offset the fact that these people are all remote now, right? They used all be sitting in this big room. And people were standing up there looking over a rail at them making sure they were doing what they were doing and available. And you can’t lose any of the customer service quality just because you’ve moved everybody out of the building and nobody can physically see them anymore. AI is the only way to plug that hole really of being able to know what’s going on in this organization with all those people remote. In your day-to-day activities, I’m assuming that since you’re head of sales that you get engaged with all of the big opportunities that come to Microsoft. And you’re in there leading the charge to get them to make a decision for the services. What are the areas that you’re seeing among those larger customers that they’re really excited about? Is it the low-code stuff, is that very exciting to them? Or are they still wrapping their arms around that? Vahe: No, no. I would say that the notion of, let’s say, application modernization, which doesn’t mean I do the same thing I was doing before in the cloud. Really thinking about, what do I want to fix? And how much I can include some perspective about what could happen in some, let’s say options or scenario? That capability that Power Apps has been giving them. And now we see that the corporations who are the most successful are the one who are almost creating a center of excellence within their own organization, that let’s say help the IT to monitor someone, in fact the usage rate. But also to amplify the user experience and to spread it across the organization. And the ability to almost measure the positive impact. Vahe: The second thing I’ve seen is on the low-code, no-code, is the time to value. It’s almost like you can almost now, and when I say “we,” it’s almost we with the partners. We can almost say for this type of let’s say expectation, or application, or challenge, it will take three month to be ready, not three years, two years. Or we have a heavy development environment. And so this center of excellence, let’s say mindset or framework, is a very powerful one. Because it helps to almost create a concentration of hey, what are the most critical things to fix and how long it’s going to take? Vahe: And people are almost, let’s say very impressed, about how quickly you can have great quality because you bring both the expertise of, as I said, almost the person who is facing the challenge every single day. Being non-technical guy, we have in fact the support of IT. And I think that’s the business decision makers along with the IT. I think to me, that’s why we have been on this six, seven times faster than the market rate. We have huge ambition there. And be aware that we have also 20 million of users of Power Apps today that came from the city campaigns. So people are actively using it, not yet paying it. So that means that it’s great, it’s the future almost by, for us to go after. Because people are starting to use in fact at least the basic functions to get adjusted customers to and so on. Vahe: The second thing I would say is that people have realized how easy it is, and recognizing that Teams became a platform close to 300 million users. It started at 25 or 30 million almost pre-pandemic. And so that became, almost as you said, you are at home, or you are wherever you are and that’s the interaction that you have with your customers, partners, ecosystem and employees. And so now it’s a marginal component to say hey, can I have one tab that is going to do that type of task? My forecasting, my thing. So this is again the connection between what you use every single day at scale, and the marginal cost of bringing a component of Dynamics 365, a component of the application that you create quickly for Power Apps or Power Automate from the process, implementation, and automation. So I think that’s what I see the two biggest part of the customer reaction, and I would say feedback for us. And encouragement to be fair, to keep going in that direction. Steve: We’ve got lots of examples that you guys have got out on the case studies of large companies that have really got in head first. And just thousands of apps in the organization solving thousands of problems. And just excellent, I mean you just have to almost grin when you look and hear about these things. But for every one of those there’s still a bunch of them out there where, I don’t know, IT maybe is still an obstacle. I mean IT has been, it’s interesting because IT’s been a friend of Microsoft for a long time because a lot of the products that they have engaged with were Microsoft products, servers, et cetera. They’ve had to make this transition to cloud, which was scary for them. But they ultimately did it for the most part, not all of them, did it. And now here comes low-code, no-code that’s got to scare the bejesus out of a lot of IT folks. And how are you at that company size? Because frankly, we struggle with the same thing in the mid-market. How, at that big company size, do you deal with that occasional obstinance from it? Vahe: Yeah, it’s a great point. You’re right. I think Microsoft in general, I don’t want to generalize, but in general have been for the last four years, very, very close to the IT decision makers. And rightfully so, because there were so many and still so many things to achieve in partnership with the IT and CIO environment. At the same time, when it comes to business applications or business process, I would say that you need to find the balance between the business decision makers, who are the ultimate decision makers when it comes to what is going to affect their business, or the way they work from a Salesforce perspective, or the way the marketing leaders wants to automate some of the processes that they believe is important. Vahe: And so that we probably are in a unique business case at Microsoft, where you have to talk to both. And the learning is that in the very beginning where you were only talking to IT, for example in the low-code, no-code, you could have signed a deal with IT, but then you know almost had to start to sell it again internally. Because you had to knock to all the doors of the business decision makers to say, Hey, do you know that you have this thing in your corporation, and anyway this is the thing that you can do, do you mind starting over there? Vahe: And so that was basically almost a waste of cycle. And so we said we have to do these two things together. We need to be able to articulate what is the value of low-code, no-code, maybe in FSI, financial service, or manufacturing, or in retail. And of course there’s a strong common denominator. But there are some specifics that may resonate more for some industries more than others, and therefore the decision makers. And we have seen that when we do these things well together in parallel, when you sign the contract, or the deal, or the agreement, the time to move to usage or the business case implementation is much faster. Basically you bring more value both to IT and the business, and for Microsoft. And so I think that’s the piece where I think it evolved on low-code, no-code, from being afraid in the beginning or skeptical, to a place where they are increasingly embracing this center of excellence environment. Where they own it as [inaudible 00:38:55]. It is connected to the business decision makers, therefore it brings value. Vahe: And so IT brings value to the business decisions or the business unit and the line of business. And then what was missing so far was, how can we give them the monitoring environment, almost the control board to manage the budget, to manage let’s say, or having warning to say, hey, business A, you know are over consuming. Should we lower the investment or should we accelerate because of what you are doing? So I think that the kind of tools that we are bringing now to the IT, so that they are absolutely part of the success of the company and they are connected to the business decision makers. I think that’s the best way for us to demonstrate value and keep it completely aligned with the business directions. Steve: And the opposite would be true also if you’re going in trying to sell the line of business owner without talking to IT. And you convince the, now you got to go sell IT. So it’s two cycles. Vahe: Absolutely. Steve: You have to somehow get them both in the same room and do it at once. So we’ve got so many products coming, we’ve got so many products here. And if you imagine a generic customer of a large size that you’re going to be going to talk to next week about all the Microsoft has to offer. What are a couple of the key products that you’re going to want to make sure you land in their head, that you feel across all companies are extremely high value or differentiators? The thing you don’t want to walk out of that room without mentioning? Vahe: Yeah, I would say, and somehow you touch on it Steve, earlier on. As part of the transition that we are driving, one of the thing is also to simplify. To simplify the portfolio, to simplify the go-to market, to simplify the strategy. We discussed the hub and spoke, let’s say strategy. And so I would say at the very beginning, what we said is that instead of saying, hey, there’s a proliferation of products. And every year we add more and more and more. And at some point you confuse your own sellers, you confuse the customer, you confuse the product, it’s super tough to digest everything, and even understanding what’s the hierarchy across all these things? Steve: For licensing Vahe: And licensing on top all this complexity, right? I mean we have gone through it, and it’s still not perfect. But at the same time I think what we said is that there are the categories, or the line of business, that we want to go in. We want to have a fair shot to take a leadership position in the next let’s say years. And what it takes to get to that point, from an innovation perspective, from a go-to market perspective, from a part program perspective, from a sales and seller investment capacity perspective. And so on. And so I would say that’s more the starting point Steve, where we say we define five categories, a fine line of business, where we believe we have a shot to become a leader. And these categories we need to be able to be clear on where the value that we bring. Vahe: For example, if you take the customer experience, let’s say OLAP, which is more the connected sales and marketing, if I may summarize at the high level. It’s going to be all the conversation about the collaborative apps, the customer experience transformation. You have already Teams for the vast batch of you, hey that’s what you want to achieve. The Dynamic 65 sales is going to give you that capability, or the LinkedIn Sales Navigator on top of it is going to give you that type of insight. You know are not touching about AI, you think about almost sales automation, Salesforce automation. Let’s show you how the AI infused capability within Dynamics 365 sales and marketing, give you that asset absolutely naturally integrated on your team’s environment. Vahe: And same thing on Viva Sales, the sales productivity, we can measure it the way you want, and you’re on control of that. And by the way, if it works on the environment that you are working, could be Microsoft, could not be as we discussed, that’s more the conversation that we want to have. And of course on the back end you are going to have Dynamics 365 sales, and marketing, and Viva sales, most of the time for that line of business. If you think about let’s say low-code no-code, I would say you will have probably three type of conversations. You know will have a conversation about hey, you’re a large enterprise, multi-deals coverage. And basically the benefit of having an enterprise wide, let’s say engagement, what does it mean? What’s the framework for you to make the most of it? And how we commit with our partners to deliver you the value. Vahe: And so you can commit on five years maybe with Microsoft and how much value we can bring already to you. Or it’s purely an application modernization. You move to a hyper-scale environment, but you have all these old fashioned applications. So basically, you are a platform that is modern but all your application are still old fashioned. How low-code, no-code is going to help you to accelerate that transition. And let’s start with one company, one app. Pick one and let’s do it right, and then replicate from there. And then potentially, in fact, the last one which I think is going to be the biggest one potentially, is the business process automation. Think about the forecasting process. I have to say that when I was running my business in Western Europe, we have been doing this traditional forecasting process, which in every company when we talk with business leaders or CFOs, that’s the same thing. You ask the forecast at the lowest level of the organization, then the manager of that organization, do a judgment. That judgment moves to the next level of management. The management do another judgment. Vahe: So all the way up to the top level, who does a judgment anyway on top of it. Or they find, depending on who is doing the forecast, almost let’s say a coefficient of let’s say correction based on who is doing the forecast. When you start to do that thing into AI and you say what, we know the behavior of people [inaudible 00:45:26] potentially, you come after 18 months or one year to a trend of forecast that is so close to in fact what you were getting before. That you say how many hours, thousands and thousands of hours of productivity saving I’m going to have just because of this AI forecasting capability? That’s the kind of example of it, for say an application for low-code, no-code, that is just checking in fact the behavior or the intelligence so far to help you to drive your business. Vahe: And so we have been running that internally as well and it’s quite impressive. And so that’s the kind of conversation that you want to have both with the IT, but you see this perfect example of hey, having that conversation with the CFO, or the sales leader, is a great one. Because it’s a marginal cost again, to what you are using already. And the same thing happened on finance, and supply chain, and service when it comes to, all right so where you, what are you using? Are you still on-prem? The vast majority of ERP, the vast majority of contact center and call center are still on-prem. So you can think about hey, what does it take to move to a cloud and more agile environment? What are the best that you want to do? Which is the strategic partner or vendor, who are going to take this? Because you’re not going to change this environment every two years. It’s a 5 year, 10 year bets, right? Steve: The marriage. Vahe: It’s a marriage. Yeah, absolutely. So I mean does it help Steve? Steve: Yeah. And I think interesting, one of the things I think about AI in forecasting, is it doesn’t have any personal bias. And obviously in larger companies I’m sure there’s a lot of checking and cross checking. In the middle market it’s a bunch of optimistic sales people coming up with optimistic projections that have no basis in history or anything else that’s going on, of what’s going on. And I’ve been in meetings where we’ve been displaying some AI facts, or figures, or forecasts, or projections. And listen to senior people just adamantly disagree. That number is absolutely not correct. And I’ve had them tell me I’ve been doing this for 30 years, I know, I know. And then here comes next month and guess what was right? The AI model was right and the guy who’s been doing it for 30 years is making up some excuses. Steve: So I think that the world right now is fraught with bad projections on everything. Cost projections, sales projections, there’s too much personal bias involved in the process of creating those things. And as leadership of a company, you’re relying on these things. They’re going to drive you right over a cliff potentially, if you’re not careful, if you don’t have good information, if you can’t get the bias out of it. And I think that’s one of the big things that AI brings that I’ve found resonates with leadership sometimes, is kind of remove all the bias. I mean it’s just removing all the bias. You don’t want to hear smoke, you know want to hear reality so you can act accordingly. You’re surrounded by a bunch of people who want to make you feel good, but AI doesn’t care how you feel. It’s going to tell you the truth, doesn’t care if you get mad. Vahe: Steve also, it’s interesting because sometime, you point to this that sometime when you are too early on the innovation, some people might be again scared or skeptical as we said. But I remember we were looking at let’s say some numbers when it comes to, are we operating consistency, for example, in the world? Or there are some that say practices that are bringing more growth or more relevant than other places. And so, one thing was interesting was in the services line of business or category, you think of case management. And it’s one of the opportunities. And you might say well case management is not super innovative. Well, it’s something that is quite well known. But case management was one of the fastest growth in majors. And that was because it was responding to the fact that vast majority of the case management processes are still on-prem today. Vahe: And the one we’re moving to the cloud, especially in public sector, to make sure that the queuing system is working, you have a full up, let’s say email to tell you and tracing where you are on the request that you put in place. All these things we believe is generic everywhere, but it’s not, it’s by far not. And across mid-market, and large corporation, and private sector, and public sector. So it’s not always innovation that drives in fact the next generation of work. It’s also in fact the basics that are not fulfilled today and that create a bad customer experience. And that’s interesting, in a way, to keep very humble about let’s say what we still have on our plate. Steve: I can remember not that long ago, when you talk about customer service, the goal of many companies was to provide as bad as service as possible so they didn’t have to do it. I mean it was a cost center for them. They hadn’t come to the realization yet, this is decades, but hadn’t come to realization yet that customer service is what drives future revenue. They just looked at as a cost center and figured the worst it is, the less people will use it and it’ll cost us less, so that mindset has changed. You talk about fears that people have of technology. And so a lot of this is people self preservation fears. They see something coming, we saw it even in the partner channel, uh-oh here comes low-code, no-code, customers are going to be doing all the work themselves, they’re not going to need us partners anymore. And it’s like this first reaction that people have about anything new, is how’s that going to affect me? And generally they’re going to assume negatively. Steve: Our business is busier than we’ve ever been as a result of low-code. So it’s actually been the opposite. But partners, and just like people, you know need to be prepared to pivot into that wind. If you’re just going to stand there with your arms crossed and not move, yeah low-code’s going to hurt you. You know need to lean into that. And the same thing with individuals that are looking at new technology. It’s coming and you can either stand there with your arms crossed and let it knock you down, which is a foregone conclusion. Or you can bend with it. And to be honest, the younger folks are more flexible than us older folks. So they’re not having any trouble with this technology at all. We recently signed a new customer, it’s all young people and man they just get it. I mean there’s no explaining anything. They understand every single thing you’re talking about, why and what. And I mean they’re born with a cell phone in their hand. None of this is foreign, but we still got to get rid of all of us old guys. Vahe: I agree, I agree. And time flies. And it’s almost like, often, let’s say, you need read to embrace that. Always a zero regret strategy in this type of, let’s say, evolving environment. Anything that you postpone, to some degree, is almost let say a loss. And that has been proven in the technology run. And when I look at, we always have to be humble. It’s a highly competitive market, and people are smart, and that’s great. Cause as we discussed, it’s all good for the customer. But I think that when I look back to the commitment of the company, the investment that we put in place last year with the support of Satya, Amy Hood, [inaudible 00:53:27]. With more than 1000 sellers injected in the marketplace, we keep going on the investment on the local no-code, even more so to drive the acceleration of the growth in addition to the Dynamic 365. Vahe: When I look at every category that we are in now, and I think it’s a good confidence level that we on the path here. That first of all, we are between two times and three times the growth of the market for each of these category, that’s a good indication. And I think that also raise the confidence level of the product sellers at Microsoft. To bring these different components together and add more value to the customer. So look, it’s a journey Steve, and it’s quite exciting to be on this. And people like yourself because we have been there also for a long time, and you know what it takes to transition. And you never fail, you learn always. And everything that you learn and that works, it’s almost to think how we can scale and bring that to the mass as quick as we can so that people can benefit from it. Steve: Well success breeds success. And you know guys have got it going right now. I’ve taken up enough of your time. Anything that you want to get out there that I didn’t ask or we didn’t talk about? Vahe: No, I think, Steve, you did a good overview of let’s say where we are, how we think. Again, I think that the simplification, the portfolio, the much more focused approach, the category, and more consistent execution on the go-to market is really the next level for us. And the hub and spoke strategy across all these categories gives much more room to increase the business opportunity for us and the partners. Steve: Yep, I think so, I think so. All right, listen, it was great talking to you, I’m glad you made the time. And I definitely hope to able to talk to you again in the future, get something new to talk about. Any time you want to reach out, and jump on, and talk about some stuff, let me know. We’re happy to get you on. Vahe: We are all, let’s say reading all these, let’s say headlines on the recession. In a few months from now, between now and then of calendar year, we’re to see a bit more clarity on how the planning is happening for the mid-market, large corporation, how the public sector is evolving in this dimension. And also, we’ll have a few, let’s say product launched that we talked about, Viva Sales, any learning from that, let’s say maybe the first two, three months, would be interesting to see how people react. And maybe that could be a great opportunity for us to chat. Also what’s going on the [inaudible 00:56:17] Steve: Yeah, yeah. Vahe: Plenty of things to talk, I guess. Steve: Sounds good. All right, well hey, thanks again for your time. Vahe: Thank you. Take care Steve, have a great day.…
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Steve reads his Blog
I had the pleasure of having a chat with a Power Platform industry leader, Jukka Niiranen. Listen or Watch below. Enjoy!
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Steve reads his Blog
1 The Works Services-as-a-Subscription Model Update 7:18
7:18 Play Later Play Later Lists Like Liked7:18
Play Later Play Later Lists Like LikedBack in May, I wrote a post describing a completely new Services model we call "The Works from Forceworks". It is a Services-as-a-Subscription model that is unique in the industry. I also promised to follow up with our learnings from this new model, so today I will do just that. The Works First, I'll remind you of what the offer is. Thanks to advances in low-code/no-code for Dynamics 365 and the Power Platform we decided it was finally time to launch a completely new services model. An all-inclusive, unlimited service that included not just support, but also deployments and customizations, along with several other things. You can see what we included here . Based on our analysis of recent customer history, "The Works" will cover 100% of the requirements for about 90% of the customers. How's it Going? Customers are eating it up. Almost all of our existing customers have converted. I am thinking we may have left some money on the table. But now is not the time to maximize the revenue, rather now is the time to flesh this out. We wanted this to be as "turn-key" as possible starting with getting a quote that can be done right on the website. This meant "standardizing" the pricing. Today there is a Fixed Base cost, plus an additional fixed cost for certain combinations, like Dynamics for Marketing for example, and then a Per User cost. Part of the thinking was that the number of users would be a good measure of the work our team would need to perform. But in reality, while a good general rule, there are exceptions. For example, a simple deployment with basic needs, but a large number of users, versus a highly complex deployment with only a handful of users. For the former, the price is too high and for the latter, the price is too low. We are still thinking about the best solution to this. Pro-Active Almost all services offered by Partners to Customers are "reactive", responding to customer requests. This makes sense in an hourly model as it is not the Partner's job to decide how to spend the customer's money. But in an unlimited subscription model, we are able to be "pro-active" since it does not affect the customers' cost. A simple example may be once a week checking to see if all Flows are running properly or checking capacity. One of the primary differences in a Subscription model is that it is very important that the customer renews at the end of the term. Customers will scrutinize that monthly charge and compare the value they received each month. If at renewal time, they didn't see the value, they will not renew. Over a twelve-month term there will be months that are more active than others. But you cannot allow a month to go by with no activity, and this is where pro-active services fill the gaps. We are continuing to add to the list of things that we can do pro-actively to bring value and building tools to try and automate that as much as possible. User Support We were initially thinking this might be a big item, and for some it is. We had this idea that all users would be added to a Team or Distribution List that our team were also members of to communicate and resolve issues. Some customers loved the idea and added all users. Others preferred to keep that group small. We built a solution that we install on each customer environment that adds a life ring icon in the top navigation. This opens a form modal where a user can report an error, ask a question or suggest an improvement which via Flow is added to the Team or Distribution list. I am pretty happy with the result having seen many improvement ideas coming directly from the trenches. Deployments The service includes unlimited deployments. This was a dicey one, but I insisted that we include it. The easiest thing to do is to specifically exclude things from an unlimited service to reduce your risk. But you would quickly get to a point were "Unlimited" did not mean anything. This is also a key point at which an unlimited service makes extra sense. For a deployment month, you know your needs will be higher than usual. When comparing to hours you could easily spend as much in a deployment month than the entire annual subscription cost. We have not been doing this that long, but I can already see that we will go underwater during deployment months for a customer. Fortunately, deployments do not happen very often. Customizations This service also includes unlimited customizations, and by extension, to do those properly, unlimited Solution Architecting. If low-code/no-code were not where it is today, this would not be feasible. Where deployments are typically a one-time big bang, customizations are continuous. Although the amount varies from month to month. So far this is averaging out okay. Exclusions We tried really hard to include as much as possible on an unlimited basis, but developers are expensive, and development can often take a lot of time. So "development" is excluded and offered on our traditional hours model. This is the one area that some customers get suspicious about. Looking for the "gotcha" they expect that every time they ask for anything we will cry "development". But again, tracking with our earlier research, many customers never hear the word "development". It does seem that the more sophisticated the customer the more they look for sophisticated solutions which can often require some development. There is some grey area here and we are likely to do something one-off that might meet the technical definition of development within the service rather than bring up the need for development hours, because again the goal is renewal. Are We Making Money Yet? It is still too early to tell, but probably not. However, this is not unusual for a new subscription service as it builds scale. We are also still building the tooling to make this more efficient. As of now, we do have one customer that I can see we will consistently lose money on every month. This is the reason I added the right for us to terminate for any reason in our Terms and Conditions. We still need to figure out the best way to handle that. Summary Was this a good idea? I was not sure when we launched this, but now I can see it was indeed a good idea. There is a tipping point of profitability based on the number of subscribers that we have not reached yet, but I am confident that we will. My next update will be when we reach that tipping point, hopefully in the not too distant future.…
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Steve reads his Blog
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Steve reads his Blog
In my recent conversations with Charles Lamanna here and Jason Gumpert here , we discussed the explosive growth of the Power Platform. Then while listening to Jukka Niiranen on yet another podcast here, I was reminded that we are all inside the Power Platform bubble. From the outside, however, this bubble is tiny. Expanding Bubble There is no denying that the Power Platform's growth is impressive, but who is growing it? Microsoft has a fist-full of enterprise-sized customers who went all-in and sang the praises. But of all the enterprise-sized customers worldwide, I doubt this has touched even 1%. Sure, we have a ton of new "citizens" making things, but a "ton" does not even register on the scale. In an imaginary global IT heatmap, the Power Platform is still invisible. Popping the Bubble The Microsoft bubble is our constraint. Microsoft people are talking to Microsoft Customers and Microsoft Partners about Microsoft stuff. Obviously, "Microsoft" is quite visible in that imaginary heatmap, but the Power Platform is still largely unknown. While organizations may be starting to hear about components, like Power Automate, for example, too many are oblivious to the other components that make up the Power Platform whole. Many think the ability to create a reminder Flow in Power Automate is the limit. Mistakes Were Made I spend much of my time with customers today trying to work around go-to-market mistakes Microsoft made and continues to make. Seeded Power Apps is one. This should have been called Power Apps Lite or Basic, so people would be aware that there is something more, like Power Apps Pro. This alone would not have solved the invisibility issue, but it could be a start. I think too many feel that the seeded capabilities are the extent of it. There are undoubtedly many widget-type apps that have been built with these seeded toys, but if a customer were to inquire about more, they would reach another GTM mistake. If they want more than a simple Laptop Checkout app, the next logical step must be "Dynamics 365". I recall clearly jumping straight into a Jet cockpit after mastering my tricycle at three years old. But that was me. Too Small Those who somehow accidently discovered that there is more available than just the seeded capabilities realize quickly that Microsoft just gave them a toy to play with. Looking back over their shoulder, they see mostly broken toys now. Many wondering why Microsoft let them waste so much time and energy before they tripped through the curtain of awareness. Too Big I am not knocking Dynamics 365; Microsoft has built a colossal Power App aimed squarely at enterprise organizations. It is indeed a "step up" from the seeded toy builder. But, among the zillion features coming soon to add to the existing gabillion features are the abilities to "Create sequences with looping of repeated steps" or "Assignment by segment priority" WTF is that? I just want to sell my stuff! You will need a team of internal and external resources just to sift through the capabilities and understand what they are and whether they can do anything for you. Just Right? There is a space between the seeded toys and Dynamics 365, which is actually the biggest hidden space. Obviously, Microsoft would prefer that you drop half of your annual revenue subscribing to their big solutions; it is not "bad"; it is their business, no different from any other enterprise software company. In my recent chat with Charles, he said, " we have some great data about every user who adopts Power Platform is significantly more likely to adopt Dynamics within the next year or two ." Maybe these users were unaware of what the Power Platform could actually do? Low-Code/No-Code "LCNC" This "is" the movement of this decade. The movement of the last decade was getting all but the genuinely paranoid to the cloud. But once there, many realized it wasn't cheaper; it was quite a bit more expensive, and subscriptions are like waves in the ocean; they never stop. Where can you save? Development expenses. Chipping away at that 5, 6, or 7-figure albatross. This is what LCNC is about. It may be subscription protection at the developers' expense, but it is still a big win for customers. From Win to Win-Win LCNC will save customers a lot of money on their Dynamics 365 deployments. Some development may still be required for some things, but not nearly as much as in the last decade. And we are only in 2022! That is indeed a massive Win for customers. But a Win-Win is achievable for those who take the time to understand the Power Platform, the same thing that Dynamics 365 runs on, and what they can build with LCNC directly on there. Not only will they save massive development costs, even if they still engage an LCNC partner, but they could also save +/- 90% on Microsoft Licensing costs. This is not highly promoted for apparent reasons, but we are helping customers build sophisticated business applications with advanced logic and automation, solving complex business problems on $5 Microsoft licenses daily! Summary LCNC, while still in its infancy, is already very powerful and growing more so every month. To see an example of what I am talking about, you can check out our Free RapidStart CRM app and our addons. All of which were built using LCNC on the Power Platform. Microsoft tells a "No Cliffs" story, meaning that you can start with the seeded capabilities, and once you hit a limit, you can advance to the Platform Platform, and once you hit a limit there, you can advance to Dynamics 365. What they don't emphasize is that the Power Platform doesn't have any limits you will hit. Many, starting with RapidStart CRM as a head start, used LCNC to build massively complex mission-critical solutions, with and without our help. LCNC and the Power Platform is a movement you cannot afford not to explore!…
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Steve reads his Blog
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Steve reads his Blog
I have had my head down working on some big things since RapidStart CRM growth exploded, and it has been a while since you heard from me. Well, I'm getting back to it with a follow-up chat with Charles Lamanna who recently took over for James Phillips as head of Business Applications for Microsoft. This was my fourth chat with Charles, and it was interesting to back listen to them in order. It really gives you a sense of where Microsoft has come. I managed to catch him in his office having just wrapped up their year-end. Enjoy! Transcript Below: Charles: Hey, this is Charles Lamanna. Steve: Charles. Steve Mordue. How are you doing? Charles: Good. Great to hear from you, Steve. It's been a long time. Steve: It has been a while. Have you got some time for a chat? Charles: For you, anytime. Steve: I appreciate it. Well, I guess the big news for you obviously is putting on the big boy hat, huh? Charles: Yes. I moved up an extra floor in the Advanta building in the Microsoft Campus. Steve: Oh did you? Charles: No, I'm just kidding. But metaphorically speaking at least. Because for folks that don't know, James Phillips leaving in March of this year, I kinda stepped in across all aspects of business applications of Microsoft. And, over the last four years, I've gotten to know the place, know the people, know the business and I'm super excited about the opportunity. And I think the future has never been brighter for business at Microsoft. Steve: Well, I never got the feeling that James held you back, or any of the folks on your team back, but he certainly, we have to give him a lot of credit for really taking this thing to a whole nother level. You weren't here before, I don't think, at least with the business apps, but it was really run by morons before he took over. And he completely turned that thing around and turned it in a whole nother business. And now with you taking over, I'm expecting that to continue. I don't know if there's been some things that have been in your bag that you've wanted to do that James was keeping you from, that you're going to pull out, or if you're just going to continue the path, or what's your thinking now that you've got that gavel? Charles: So definitely not held back. I would say I was super fortunate I worked for James for, I think seven, eight years in total. So I was able to learn a bunch and he was without a doubt, the most supportive manager I've ever had in my career, in terms of both enabling and clearing paths for what we wanted to do from a vision and dreaming perspective. And if it weren't for his support, things like Power Apps would have never gotten off the ground. So, definitely. And I think as we go to the future, we have this amazing foundation. I mean, BizApps is a major and key component and pillar of the Microsoft Cloud. Charles: 10 years ago, you probably would've thought that impossible. Right. To have Dynamics and Power Platform alongside Azure and Office. Now that we're here, let's go take it to the next level. And that's the push, and it's continuing a lot of the great innovation we've already done from a data-first, AI-first approach. Kind of sprinkling in some more collaboration with teams, and really revisiting the end-user experience, the platform, to go increasingly modernize and scale it and make sure that all our components from CRM, to ERP, to Power Platform work great together. Steve: I don't think it could have achieved that status with Dynamics 365 alone. It really took the Power Platform coming into being, I think, to give it the breadth that it needed to be able to get there. With Dynamics 365, we didn't have apps for users to do small things, there was no way it was going to permeate an organization the way the Power Apps do. Charles: Yeah. Yeah, that's right. I say two things are interesting. The first is, Power Platform has allowed us to help more users and more customers with business process transformation, which is what BizApps are all about. Right? Steve: Yeah. Charles: How do you make your sales processes better, your financial processes better, and Power Platform really turbocharged that. And that earned us credibility in a lot of those departments and with a lot of those users, and we have some great data about every user who adopts Power Platform is significantly more likely to adopt Dynamics within the next year or two. So we see that symbiosis working in a way which is incredibly customer-friendly, and it helps our business. Second thing is Power Platform has even helped us reimagine parts of the Dynamics apps themselves. And I think probably two of the best examples are the connectors, which are key to the Power Platform. Charles: You see the connectors starting to show up inside all these Dynamics apps, like Customer Insights uses Power Query for data ingestion, or Viva Sales even connects to Salesforce. So there's this amazing interoperability that we have, and also enabling the end-user. Our team built Viva Sales, even though it's not in the Dynamics or Power Platform brand. But it's this idea of having an integrated experience in Office for sellers, built on connectors and built on the Office integration. So it's changed the way you think about some products, and it's also helped us go expand our user base. Steve: Yeah. I saw I was on a PGI call with that yesterday. Very, very cool stuff. At the last PAC meeting, I was supposed to be on the Viva Sales round table, but I'm like, "Yeah, that sounds boring. I think I'm going to go to this one." And I really, I went to the wrong one, I missed a good one. But you know where I am, right? I'm on the platform. Charles: Yep. Steve: And we're exploding. Our app is continuing to grow on the platform as a low-cost simpler alternative to Dynamics 365 for companies that aren't ready for that. And I'm always bugging you about, "Hey, that cool new feature you guys got in the first-party. When are we going to get that at the platform level? So ISVs, and people that are just building their own stuff from scratch, could take advantage of some of the syncs." We got the Outlook app a while ago, we've been getting some things. And when I saw Viva Sales, that was probably my only disappointment was that, at least as I understand it, it's hardwired to Dynamics or hardwired to Salesforce. And I get that trying to play those two against each other, but it's leaving guys like me out in the cold. Charles: Well, I'd say for Viva Sales, the intent is to support any CRM, and I really do mean that generally. And even customers, because there are customers out there that we talked to today who have homegrown CRMs, they coded 15 years ago. They have a whole dev team still working on it. The idea is to support interoperability with your account records, your lead records, your opportunity records, standard pipeline data. And to do that in a way which works through the connector. So today it'll earn V1, it'll only be Dynamics in Salesforce, but the intent is to make that be a general purpose adapter. And you could have a RapidStart CRM connector, which shows up and supports the contacts the way we want, and it would be connectable. That's not going to happen in the next three months, but that's the ambition. Steve: I can call you in four. Charles: I go down and said... What was that, in four Months? Steve: I can call you in four months. Charles: Yeah. Yes. Yeah. I might not pick up the phone then in four months, no I'm just kidding. Because even talking about, if people are even on Seibal. We should be able to support them with their sales. Because the idea is, you shouldn't have to transform the seller experience at the same pace that you transform your core CRM, your core system of record, and that's just the way the world's moving. Steve: Well, I love the idea that one of the challenges that CRM has always had, of course, is user adoption. It's one more place they need to go to do something. Outlook app helped with that, getting data into CRM without them having to actually go to it. It seems like yet another way for people to engage with their CRM without actually realizing they're engaging with their CRM. Charles: Exactly. Yeah. It's almost like ambient... Yeah for sure. Sorry. Yeah. I say it's almost like ambient CRM basically. How do you make it so that, instead of the user goes to your CRM, the CRM goes to the user where they are. And the outlook app was the beginnings of that. Some of the Team's integrations we've done are the beginnings of that. And that Viva Sales and that whole Viva idea is how do you elevate it? So anywhere you go, your CRM data is accessible without you having to go to a different user interface. Steve: Very cool. Very cool. So I ask you every time we get on a call about exciting features that are coming up. And in particular, maybe even some features that have launched, that didn't take off the way you thought they would and people are just missing something. We have this problem with our app sometimes, people don't understand and so they don't move forward, and it would be perfect for them. And I'm sure there's lots of features and capabilities that you guys broke a sweat building, and know in your heart, this would be awesome, but people don't seem to be getting that. What's a good example of one of those? Charles: I'd say a product which we've had a capability, where we've had a lot of customer usage from a small number of customers, but very deeply and with huge impact, and we wish were with more customers, is probably Conversation Intelligence. I'm not sure if you've seen that around the Sales app, and where that actually will sit in inside of say a phone call or a meeting and help you generate action items, and summaries, and coaching, and help you understand sentiment, and listening and talk ratio. We've used that internally at Microsoft with great success. So our digital sales reps and the folks who work our phones, they are diehard fans. We have this amazing video we released a couple months ago where we actually went out and interviewed these digital sales reps and their managers, and they just were going on and on about how great it is. Charles: And that's rare where you hear that about a piece of technology for a seller. And we have a few other external customers that have gone through that same journey, where they have a thousand digital reps, 2000 digital reps using this and just in love with it. But it's not as pervasive as we thought it would be at this point. And it's one of those things where, it's a product discovery, and easing people into the capability, because then you got to go out of your way to enable it and configure it. So we're doing work now to simplify it, and make it more accessible to more users. And we're doing that partly through Viva Sales, like conversation intelligence, the major capability of Viva Sales. Charles: And the second thing is also, there's even some culture aspects to it. Because if you use it, it's generating transcripts and recordings of a call, and not everyone's necessarily super comfortable with that. So we're even working about how do you enable more features without having to record the call, and how do you enable capabilities without having to get a transcript? Or how do you make it more natural to say, "Hey, I have a sales co-pilot thing. Are you okay if I enable it?" So there's a lot of interesting things, it's never just a technology problem. It's also a discovery and a, I'd say, change culture management problem. Steve: Yeah. I think that's been the challenge with anything AI really. A lot of people, it seem to think it might be a little too futuristic. They look at the benefit and think that's really cool, but they have no idea how to get it. And AI just in general, doesn't feel that approachable to people, even though in certain cases, it's extremely approachable. You don't have to do anything, it's approaching you. So it's a learning curve, you got to wait until my generation dies off and then you guys will see. Charles: I don't have as myopic of you, as you Steve. But I would say that, the big thing that we have to do is, there's been this evolution of AI where the AI is going to be something that automates away what humans do. And what we've realized is, AI is not even remotely close to being able to do that. But what AI can do, is it can turbocharge the people that use it. And so what we're trying to do is, how do we go expose these AI capabilities in a way where you or anyone else who uses them feels so much more productive. And just like when you first got the ability to use PC or a spreadsheet, you're like, "How did I exist before?" We're hoping we'll get to the point where, once you start using some of these AI assistive capabilities, like we've done in Conversation Intelligence, you'll be like, "How did I ever do a customer call before? And I had to take notes on paper while listening as opposed to having the AI take notes for me?" Yeah, exactly. Steve: I'm terrible about that. I'll be chicken scratching over here while I'm talking to people, and then we get off the phone I look at and I can't understand a word I wrote. Charles: Yeah. I like post-it notes next to my desk where I'm always writing stuff down. Steve: Yeah. So what else cool's coming on the horizon that we should be... That sounds like the Conversational Intelligence has been around. Sounds like Viva Sales is going to really bring that to the masses, so that one's on a path. What are some other new things that we should pay attention to that you're able to talk about? Charles: Yeah. Another one of my favorite things, which we've started to reveal some capabilities going back to last Ignite, so November of 2021. And we have some big announcements planned for the second half of 2022, is the new Contact Center related capabilities inside of Dynamics Customer Service. We have Omnichannel, we announced integrated voice, the Nuance acquisition closed, and the Nuance contact center AI team joined my group to align with customer service and contact center. So there's a lot of really exciting innovation happening there. And I'm really excited about the potential to make it super easy to get a comprehensive customer engagement story, without having to wire up eight different pieces of technology and do a ton of different complex integrations. So that's a place where there's a lot of innovation, there's new capabilities, Omnichannel, Power Virtual Agent, even the same type of conversation intelligence applied to support cases, Nuance for their Gatekeeper, which is identity and authentication verification based on voice and biometrics. Charles: There's a lot of cool stuff in that space. And that's one of the places where so many of the customers we work with are trying to improve the customer experience, and to go reduce costs. So I say that's a place where we've had a lot of exciting announcements over the last six to nine months, and we have a whole bunch more planned for the next six to nine months. So I say, stay tuned. And I won't say more than that to avoid getting in trouble by leaking information. But I just say, that's a place to really pay close attention. Steve: Who knew call centers could be cool? Charles: Yeah, exactly. Who would have thought that I'd be talking about contact centers, and how it's the next generation or next frontier of AI applications in 2022. Steve: Oh, well. Well I do have to thank you guys for the low-code advances you've continued to make in that platform. It actually allowed us to launch a, I think we're the first ones to try this, a new Service as a Subscription. Which includes awesome includes deployment, customization, training, everything except development code, which as you know today in so many of these projects, there's so little, if any of that. Charles: Yeah. Steve: Just a few years ago, if you tried to offer something like this, it really would be little more than a support agreement. But now, we're deploying, we're building, we're customizing, we're building entire things for customers all on a monthly subscription. It's an interesting concept, and hopefully I don't go broke, but... Charles: But you know what, it's fascinating. I literally was talking about this with the Power Platform team this morning. About a future where we'll have more partners who are able to sell a comprehensive service agreement, which includes the cloud hosting licenses, but also some incremental custom development and also ongoing maintenance and support. And it'll be almost this whole new industry, which will push a lot of innovation to the edges of the ecosystem, right? Steve: Yep. Charles: Not built by Microsoft, built by partners who really understand particular regions, particular industries, or particular segments. Like y'all are targeting a space where we're not trying to go take Dynamics, CRM, and go bring it down there. You can go build a world-class experience on top of our platform and provide a very much all-in-one, which exactly serves the needs of that audience and that market. And we can stay focused on building the super horizontal platform, which has great performance, great usability, incredible power, those types of things. Steve: Yeah, it sounds great. I'm glad that we had the same idea you guys did. I'll let you know, in a few months, if it was a smart one. Time will tell. Charles: Yes. Yeah. Steve: So, how are the rest of the team doing? It seems like some folks have moved around a little bit in the org, who's moved where? Charles: Yeah. So one of the big things we've been really focused on the engineering side, for the engineering organization, is bringing together strength from a product perspective that target the same type of user. And for example, we have a new customer experience platform team underneath Lori Lamkin, who leads all of our Dynamic Sales apps. So the Core Sales and Viva Sales, as well as commerce, as well as marketing, as well as customer insights. And it's very much focused on revenue generation, customer journeys, customer experiences. And what's great is by bringing those assets together, we have a great answer for B2B customers, as well as B2C. Like if you want to have self service, no touch eCommerce experience with lightweight telesales, you can do that all with those sets of applications. If you want to do a high relationship, high touch B2B sales process, you can do all of that. You're not going to use commerce, but you're probably going to use customer insights and sales, and maybe a little bit of account-based marketing. So we brought together these things, which are solving similar problems under a single leader. And that way the engineering teams can go back and forth between these different places to finish out full end-to-end customer journeys. And so that's a big area that we've spent a lot of time on, and that's a place where it's really the biggest and fastest growing category for us in the Dynamics 365 application portfolio. So that's one interesting example. Jeff Comstock, folks may know him. He's been around Dynamics 365 for a while. He continues customer service, he leads omnichannel, he's done some of this great expansion around the contact center for us. Ray Smith leads our supply chain team. So that includes things like more supply chain. Steve: So Ray moved? Charles: Yeah, yeah, yeah. He by way of acquisition to SAP then moved. He worked in Dynamic Sales for a bit, where people may have known him. And now the supply chain, and really helping us be this new data driven, AI powered, supply chain story for core supply chain execution. Then we also had some exciting announcements around process advisor and the minor acquisition to help turbocharge that. Or Georg Glantschnig who leads our finance room of the house. And basically we call the room of the house, is the collection of products which focus on serving the CFO and the finance department. And that includes the Suplari acquisition, which we had done a couple years ago, as well as the Core Dynamics, 365 finance, HR, and project operations products. Charles: So you can see how we started to build these critical paths around particular departments and particular lines of businesses with our products. And in addition to that, we also of course have Power Platform to support all of it. So it's amazing to see these things come together and converge. And we've been on this incredible run of innovation around Dynamics. I was counting it earlier this year, 29 different products in Dynamics, and really coalesced around these specific areas where we have a lot of energy, and also very well understood. I'd say synergies between the products that we have. So I'd say exciting times. Very exciting times. Steve: Customers are starting to understand it better also. Business Applications was the same thing for a long time. Then it spent the last five years reinventing itself every month, and new things exploding out of Advanta. And I think a lot of customers were having trouble just keeping up with... It's like little whackamole for them. And it takes a little time for customers to absorb what's happening, and what it's for, or what it does, and then to adopt it. And we're seeing that now. We used to have to go out and promote Power Apps to people who didn't understand what this was, or why it was. And now it's the opposite. They always come to us, looking for Power Apps, looking at those sorts of things. So that understanding seems to have finally permeated down to the customer level. But boy, it took a while. Charles: Yeah. It warms my heart. And I would say one of my favorite books is by Jim Collins, 'Good to great.' I always recommend it to folks on my team to read it. And he talks about this idea of the flywheel. It takes time to get a flywheel spinning, for the first period of time it looks like it's barely moving, but then eventually it's going super fast and it's just a blur. And you need to be consistent, and convicted, and believe in the strategy and the approach. And what's amazing about BizApps is for the last four years, we've been on the same mission, the same vision, the same ambition. And we just spend all the folks in advance at turning that flywheel, turning that flywheel. And it's started to reach that blur phase where it's spinning so fast, you can't even see it. Charles: And this, this all started years and years ago with a ton of work, but we're really at that magical moment where customers know what Power Platform is. Customers know that Microsoft gets customer experience and customer engagement. They know that Microsoft can help them optimize their supply chain. And what the good news is once that thing is going, it really builds upon itself, and I think it'll only continue that momentum further. And my favorite story is, I used to always do these executive briefings at Microsoft where we have executives come in from our customers to Redmond and we have a briefing center. It's very nice. And I would always say, let me talk about Power Apps and low-code. Charles: And everybody gives me a blank stare like, "What the heck is Power Apps? What the heck is low-code?" I go in those meetings now, and people know what Power Apps is, and they know the low-code strategy. And the only question is, "how?". Not, "should I?" Or "if?" "How do I do it with you, Microsoft?" And so different from three years ago. So anyway, so you're exactly right. A long winded answer, but I'd say it's exciting to see all of these things come together, and the benefits of just consistently repeating a message that resonates with customers. Steve: I would say at least three quarters of my customer calls today, they're bringing up right out of the gate, "We don't want any development. We want to do everything low-code, no code." So this is coming from the customer side where we used to have to explain to them what low-code, no code meant. Now they're coming demanding, "I only want low-code, no code." I think that they've come to this realization that, while low-code, no code might not be easy enough for your mom to do, it doesn't require a developer, and code does require developer. And once you've got this little blob of code in your environment, it's a black box for you. And so they don't want any of these black boxes. They want everything to be accessible. Steve: Use your knowledge to build us something complex out of low-code, but then I can still go back in there later and manipulate it, adjust it myself, or our team. So they have absolutely bought into that. And I know we originally, a lot of us partners were concerned early on that this was going to reduce the workload for partners, while our workload is more than it has ever been. Although the developers on the bench don't stay as busy as they used to. We've completely pivoted the team from developer heavy to now, we haven't even got a good title for them. A citizen developer doesn't sound right. We tell customers that, but citizen developers is what we've got so... Charles: This guy we found on the street, or gal found on the street, we just asked them to start building out. But no, it makes sense. There is almost this new role which is, it's not just pure coding expertise, it's technical development concept expertise. But even more importantly is business process and solution expertise. And that fusion of those two skill sets, that's the magic. That's what makes it special, because you understand it. Steve: Yeah. The challenge that we have with this brand new model that we just launched, because, first of all, being the first one out there is not always good because people have no idea what you're talking about. They're trying to compare it to other things. But we've got this little caveat that it's all you can eat, everything, except development code. And trying to define what that is hasn't been easy, and you get these customers coming in, "Oh, we're going to need a lot of customization. So this isn't going to work for us." And so you may need a lot of customizations, but you don't need any "development code". Charles: Yeah. Steve: And getting them to grasp that development code and customization are not synonymous, not even close. Charles: Exactly. Steve: Development code is a very small component today of customization. And once I think that they understand that, then we'll probably see more partners coming into a model like this. Because it makes a lot of sense for customers, makes a lot of sense for partners. Charles: Yeah. And if you go look at building solutions that last a decade, this is to your point, code is this little black box opaque thing, which is hard to maintain over time. If it's no code, low-code, it's easy to open it up and reconfigure as business requirements change. And it's how you build solutions that last. And I think we're getting to the phase with business software where customers are expecting to make long term technology bets. You're not going to replace your CRM every five years from now on. It's like building manufacturing plants and warehouses. These are big investments that you need to be able to amortize over a long time, to justify. And so I think to your point, no code doesn't mean no flexibility, no customization, also doesn't mean no agility. It just means you're doing it in a different way. Couldn't say it better myself. Steve: All right. Cool. Hey, listen, I'm going to let you go. I really appreciate you taking the time out of your day here when I caught you, to chat with me about this stuff, always fun talking to you Charles. I'm going to call you in four months and ask you about Viva Sales for the platform. Charles: Sounds good. Sounds good. Steve: I've got you on record there. Charles: So really appreciate you taking the time, giving me a ring, Steve. Hope you have a great rest of the summer. Steve: All right, man. Have a good one. Charles: Yep. You too.…
In my 20-plus years in this CRM business, I have seen my share of "Funnels". Lead Funnels, Sales Funnels, Delivery Funnels, every kind of business-related funnel you can think of, I have probably seen it. From what I have witnessed, most businesses have no idea how to use them effectively. So, let's talk about Funnels. The Numbers Game One of the most significant areas I see where customers are consistently missing the mark is in their Sales Funnels. While at the same time tripling their investment in Lead Funnels. The logic seems to go like this; if we currently convert 5% of our Leads into Sales, we just need 10X more Leads. As if somehow, by dramatically increasing the size of a pile of crap, the smell will improve. But, logical as their argument may be, the math does not hold up in execution. If your sales process is working as hard as possible to convert 5% of your Leads, multiplying what gets thrown into that process by ten will not result in a 10X sales increase; more likely, your conversion rate will plummet. And, by the way, multiplying your leads by ten is not cheap or easy to do either. Fixing the Right Problem Don't get me wrong; Leads are vitally important to any business. But creating a waterfall that you are only capturing a bucket from is more than a waste of money and energy; it could actually be hurting you. If 95% of your Leads are not buying, then something is broken, and shoving more people down a broken path is like shooting a bullet into the head of each of those missed opportunities because they are now dead forever. Today you seldom get a second chance. What is a Healthy Conversion Rate? That depends on many factors, varies widely by industry, and actually starts with your Lead Funnel. Wide funnels will capture a large number of non-prospects. Why do they click or call when they are not valid candidates? Who knows, boredom, bots, etc.? Either way, they are a waste of your resources. This is a common technique employed by many marketing/SEO agencies, creating a wide funnel so they can point to how many leads they generated to justify the continuation of their services. But the number is not important if you only convert a small percentage of them. There are three possible reasons that you are not converting more. Either a) your value proposition is crap, b) your leads are the wrong people, c) your sales funnel sucks, or a combination of these. Your Value Proposition Your perception of your Value Proposition is irrelevant, it is something seen through the eyes of your Prospects, and even highly qualified Prospects will each view it differently. How hard is it to sell your product or services to a qualified lead? If it is too hard, there is something wrong with your value proposition. If it is too easy... there is also something wrong with your value proposition. I am not a buyer of whatever you sell, so having the right value proposition is on you to figure out. Your Leads are the Wrong People Congratulations, if how much money you throw away was the measure... you're winning! Unfortunately, no amount of unqualified Leads will fix a Conversion problem; instead, it compounds it. This leads us to the real issue. Your Sales Funnel Sucks The good news is that you are not alone; the bad news is that you are failing to convert 95% of your leads. Effective Sales Funnels are elusive things. This is probably why so much money is shoveled into increasingly wider lead funnels in an attempt to overcome the real problem, but it just masks it at best. Too many people think that their Lead Funnel IS their Sales Funnel, which means they are missing a Funnel. In most businesses, Marketing, whose job is to create leads, and Sales, whose job is to close them, are related but completely different things. Sure, one thing "should" feed into the other, but the skill to get someone to click on a Google ad, for example, is a different skill than getting that someone to buy. But they are directly related in that the person creating the leads can make the conversion of that lead easier or harder depending on their skill. For most B2B and many B2C organizations, a seller will take over at some point, and a "Sales Funnel" will ensue even if it does not actually exist. Suppose you don't have an official Sales Funnel that has been thoughtfully developed. In that case, you actually have a unique unofficial funnel for each salesperson based on their personal knowledge, skill, and history. This is also why you see such a wide disparity of close ratios across your sales team. Building a Sales Funnel First, do you need a CRM to have a Sales Funnel? A Sales Funnel, like a Lead Funnel, will need some steps. Too many people try and skip having any steps other than "get the prospect on the phone a close them!". But the 1960s are ancient history, and selling today requires more sophistication and finesse. Just getting that prospect on the phone is no easy task now. A logical, systematic process will generate much higher success, and modern CRM solutions are purpose-built for this. If you feel like CRM solutions are too expensive or complicated, you can check out RapidStart CRM to build your Sales Funnel. It is possible to build a Sales Funnel by mirroring the steps and process of your star sellers unless all you have are mediocre sellers. Either way, a good Sales Funnel should start before the Lead Funnel ends. To be proactive, you have to know what is coming, what context they are coming in from, and what they have already been informed of before their arrival in your Sales Funnel. CRM solutions can also be utilized to build and track Lead Funnels, making this visibility much easier. Reactive Sales Funnels always have lower success. A good Sales Funnel can make both your stars and your mediocre sellers better. Automation You may have heard the terms "Sales Enablement" or "Sales Automation"; they are popping up a lot lately. A Sales Funnel is also at the center of these, and varying "Automation" is layered over the Funnel. Applying "Automation" to steps where it makes sense throughout your Sales process can accomplish many things. Among these is a consistency of process. Once you have a working Funnel that generates successful outcomes, you will want to replicate that motion consistently, and nothing is more consistent than automation. Automation is also "instant", so your process commences immediately when triggered, which is something many customers seem to like. Automation can also multiply the capacity of an existing team, meaning you may not need to hire, and you may be able to shed some dead weight. You have to be certain that your Sales Funnel works before you automate it, or you could automate yourself right out of business. Summary Funnels are not generic, although my advice here is. Effective Funnels will be unique to every business, so, unfortunately, I can't provide a step-by-step guide in a blog post that would do much good for you. If I tried, it would not be the proper Funnel for you and could cause more harm than good. But, a firm that builds Sales Funnels all the time, like my company, Forceworks , can help you if you need it.…
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Steve reads his Blog
1 It’s Time for a New Services Model for Dynamics 365 and the Power Platform 7:26
7:26 Play Later Play Later Lists Like Liked7:26
Play Later Play Later Lists Like LikedAbout seven years ago we pioneered the "Support by Blocks" model, and it has served our Forceworks clients and us well. But thanks to Microsoft, it is time for a whole new model for Dynamics 365 and Power Platform Support and Services. Let's unpack this one. The Challenge Let's be honest, no business application you can buy will serve your needs as delivered. Any of them will require some modifications to fit your goals. Fortunately, you have many Microsoft Business Applications partners to assist you with this, including my company Forceworks . This is not new; customizing business applications has been around as long as business applications have been around. For a small organization, you may only have to invest a few bucks to get things where you want; enterprise customers often invest six or seven figures to get things right. It is not a small industry that I am in. It is precisely this high cost that has led Microsoft to invest so much into low-no-code technologies. How many more customers could Microsoft have if this "startup cost" was significantly reduced? More on that in a minute. Models There are quite a few engagement models available from different partners. The old "Fixed-Price based on your Requirements" has fallen out of favor, and for good reasons. Scope creep is a common one, but customers, thinking that competitive bidding got them the best price were often surprised at how much the bids came in at—typically ranging from 25-50% higher than what Time and Materials may have cost. Partner risk padding has probably run off many customers, But as I said, few partners even offer this model today. The most prevalent model is the Time and Materials model, which may be based on an estimate. But Scope Creep rears its head just as often there, the difference being that the customer assumes the risk. Still, this usually works out cheaper than what a "Risk-Adjusted" Fixed Price would have been. Blocks Several years ago, we pioneered a variation on the Time and Materials model called "Support by Blocks". In that model, the customer pre-purchased blocks of time, like 80 hours, for example, for a single blended rate that was discounted for their pre-payment. These hours would be consumed by anyone on our team, developers, analysts, consultants, etc., to meet customer requests until the block was depleted. It was a better model for both the customer and us than traditional Time and Materials and has served us well for many years. The downside was that some customers became too focused on the hours, often hoarding them to stave off having to buy more. This also meant that they would never reach the full potential of what these solutions could achieve for them. It was understandable but frustrating for me to know what "could be". It often triggered their "we'll take it from here" reflex when a block was depleted. This always meant the end of the line for any hope of exploiting the full potential for their business. They were obliviously missing out on dollars to save pennies. Is it Time? I have had this idea in my head for many years about an "All-You-Can-Eat" subscription model to eliminate scope and hours from the equation. But to not go broke, you would have to either charge an astronomical amount or exclude the development work. And each time I had looked in the past, there was still way too much development work, relegating any Subscription to just Support. But in the meantime, Microsoft has continued to advance the low-no-code platform, and I was noticing the utilization of our code-writing developers was falling, and developers are some of the highest paid people in a partner organization. To confirm my thinking, we analyzed our customers over the last 18 months, and sure enough, the level of actual code development had continued to drop. In fact, in the previous 12 months, less than five percent of our customers needed any actual code development at all. Bingo! "The Works from Forceworks" I could not wait to take this new information and finally build the model I had been thinking about for years... so I did. " The Works " is that all-inclusive model with unlimited everything except code. One challenge is making sure a prospective customer understands what "Code" means. They seem to feel that anything they could not figure out themselves must be "Code" and fear that anytime they open their mouth, the "Code Alarm" will go off. But our analysis says that is not the case. And frankly, the way you make money on a "Service as a Subscription" is over time, so renewals are far more important than some quick buck made from the code alarm. If that "Code Alarm" goes off too often, or possibly even once, the renewal is at risk. Again, this model would not have been viable even two years ago, so I have to give Microsoft a big hug. The Big Gulp A model like this is not without its risks for us. For one thing, our primary competition was not other partners but rather customers thinking about hiring someone internally. While these people are not easy to find, the thought that they could be found limits what a customer would pay, and it would have to be less than an internal salary. We went with an extensive list of unlimited services, starting from and including deployment(s). There were some heated conversations internally about what could be realistically offered on an unlimited basis for a fixed monthly cost. Still, I pushed for the max, and I happen to own the company. The service does have a one-year term to prevent someone from maxing out capacity in the first month and then canceling. Resellers To work financially, we need scale in both customers and people for a model like this. We had dabbled with some resellers with our "Support by Blocks" model, but I was not happy with the results, both for us and the end customers. Adding a third party in the middle created conflicts. But this new model is perfect for resellers, who are all looking for a recurring revenue component that they can bolt onto their existing billing arrangements with their customers. And since it is "scopeless" and "unlimited", there really is no reason for conflicts. Summary It is early days, but we have already transitioned most of our current customers to this new model and have started onboarding new ones. So, the customer verdict seems to be in on the value proposition. I expect to be underwater for a while financially as we scale up, but I was prepared for that. I am "Betting the Farm" as they say. We are firmly planted in the battle for the limited talent, but even those folks seem to like this model, so I am not too worried about that. In fact, I have another idea for that, but I will let you in on that a little later :) Those of you who know me know that I am not afraid to try new business models, and so far, each one has been better than the last, and I feel stronger about this one than any other. Wish me luck!…
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Steve reads his Blog
Microsoft Dynamics 365 business applications are fantastic products. Unrivaled power and features and priced accordingly. Are they over-priced? No! Are you over-paying? Maybe. So, let's unpack this one. My Cable Bill Several years ago, I moved into a new home, and shortly afterwards the local cable company salesperson was on the phone. I was easily talked into the "Gold" package because it "included everything" and I suffer from FOMO. After a few months I realized that I only watched about 10 channels out of the 500+ that I was paying for. Maybe there are other people who watch all 500? Anyway, I was able to slash my cost by about 80% and not miss a thing. But I digress... What can you do Dynamics 365? Out-of-the-box, Dynamics 365 apps bring a ton of features and capabilities. The Enterprise Sales app for example, at $95/pupm, allows you to create and manage Leads, Contacts, Accounts and Opportunities, but it doesn't stop there. Since it is built on Dataverse, it also integrates with Microsoft Teams, and Microsoft Office and the entire Power Platform. You can create Product catalogs and multiple pricelists, along with quotes, orders and invoices. It also includes A.I. capabilities to help you predict sales risks and next best actions to take. For your sales team you can enable guided selling to quicky onboard new sellers and implement best sales practices across your team. With your Dynamics 365 Sales Enterprise license, you can set up and experience Sales Premium features such as Sales accelerator, conversation intelligence, and predictive scoring. There are many more features to explore also. And you can add Dynamics 365 Enterprise Service to this for an additional $20/pupm. But wait a minute... will you use all of these capabilities, or even many of them? If not, maybe Dynamics 365 Sales Professional is a better option. Professional Microsoft also offers Dynamics 365 "Professional" for Sales or Service at $65/pupm. Or you can get both Sales and Service for an additional $20/pupm (total of $85/pupm). In this "scaled down" version, they have changed a few things. For Sales Professional for example, the following are not included: Competitor tracking, Customization or extending out-of-the-box reports, charts and dashboards, Knowledge base, Embedded AI, Forecasting, Sales Goals, Product families/hierarchies, Product relationships, Business card scanning, Sales Literature, Territories, Sales Teams, Email Engagement, Predictive Forecasting and Relationship analytics. There are also some limitations in place including: a maximum of 15 custom tables, maximum of 5 Business Processes, maximum of 5 custom reports or charts or dashboards, maximum of 2 custom forms or views. Similar limitations apply to Service. But wait a minute... does this still include things you may not use? Are the customization limitations too great for you? Customization Even though Microsoft Dynamics 365, particularly the Enterprise apps, include a boatload of features and capabilities, we still find ourselves working with customers to configure and extend the apps. Adding custom tables and fields, adding new relationships, building new forms and views as well as workflows. We often end up modifying much of what is provided out-of-the-box. All of this in effort to make Dynamics 365 "fit" an individual business' needs. Most of the time these customizations become the priority elements, and much of what was provided out-of-the-box is never used. Every Customer is Different For some customers many of the provided features and capabilities will be utilized. For others, they may just use the basics. For others still, their customization needs are so great that Dynamics 365 really ends up serving as more of a platform to build on. If you are in the first group, then you are probably not over-paying as you will get the benefit of the features that the price incudes. But if you are in either of the other two groups, you are absolutely over-paying! RapidStartCRM Okay, here's my pitch. Some readers complain when I promote my business, but I gotta eat too. We created RapidStartCRM to address the very issues I described above. RapidStartCRM is a basic Sales and Service app built on the same platform as Dynamics 365. What does that mean? Well, first it means that many of the things that are available for Dynamics 365 are also available for RapidStartCRM, like integration with Microsoft Teams, and Microsoft Office and the entire Power Platform. While the enterprise apps obviously come with many more features, even though they look similar side-by-side, RapidStartCRM will manage your basic Sales and Service needs, which even at the lower Dynamics 365 "Professional" level would cost you $85/pupm. If you foresee a lot of customizations in your future, RapidStartCRM shines even brighter. Since RapidStartCRM is built on the same Dataverse platform as Dynamics 365 the customization capabilities are the same. RapidStartCRM also has over 70,000 users, about half of which came from either Dynamics 365 or Salesforce.com! Oh, I almost forgot to mention, RapidStartCRM itself is free and runs on a Microsoft Power Apps license will cost you $5/pupm. Why Stop There? Yes, we are exploiting the fact that Dynamics 365 is very expensive and too complex for many users. And yes, we built a low-cost alternative on the same platform right next to Dynamics 365. But then Microsoft gave us a clear path to continue our exploitation with their Dynamics 365 Field Service application at $95/pupm and their Dynamics 365 Project Operations app at $120/pupm. The exact same issues described above apply to both of these apps as well. So, we thank Microsoft for the inspiration and went ahead and built our RapidStartCRM Field Service addon and RapidStartCRM Project Management addon, both priced at $10/pupm. Why so Cheap? Microsoft has basically taken over the business world with their Microsoft 365 products (formerly called Office 365). They offer a very robust set of features for your productivity needs starting at $5/pupm. As a result, many SMB customers and enterprise departments have gravitated to them. When it comes to adding business applications however, too many of these same customers choke when they see the costs. The expected result is that they seek business solutions elsewhere, from other vendors who, while they don't integrate or share the security model of Microsoft 365, they do meet the price criteria! We intentionally priced our top-rated apps, which run completely within your Microsoft cloud environment, to make it easy for you to decide to maximize your Microsoft 365 investment and security. Also, full truth be told, we know that many of you will reach out to us to assist with your support, integration and customization work. If you want to learn more about RapidStartCRM, go here , or hit me up!…
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Steve reads his Blog
I've heard this term bandied about for many years now, "Single Version of the Truth". As Jack Nicholson once said, "You can't handle the Truth!" I would paraphrase that as, "You can't afford a Single version of the Truth, and you wouldn't want it anyway!". So, let's see how many of you I can get to agree on this one :). What is Implied? From a business standpoint, "Single Version of the Truth" or SVT, is often pimped as this utopian idea that all of your data, about everything to do with your customers and your business is in one place. providing the coveted 360-degree customer view. First, no such Utopian application can be subscribed to from anyone on this planet today. However, you can subscribe to several applications and potentially spend an enormous sum of money and time to wire them all together, giving the illusion of a SVT. While some of you might be sad to hear that SVT is not "push-button", I will try to cheer you up by saying you would not want it anyway. Silos are Bad! Yes, if you read back on my blog, you will see me also preaching that data silos are bad. In fact, I used the same post image for this post. But that was then, and this is now. Back in the days before the Power Platform, when all we had was Dynamics 365, we also sang Microsoft's tune of the time that "You want all of your data in one place", meaning in a Dynamics 365 database. This was a strong argument for a customer who was considering multiple point solutions made by vendors other than Microsoft. And we had a great deal of success consolidating those multiple point solutions under a single Dynamics 365 umbrella. But to call that a SVT was a stretch. Maybe "Fewer Versions of the Truth" with a 245-degree view of the customer was a more realistic goal, as that was typically the outcome. Dynamics Silos Even under the Dynamics 365 brand there were, and still are, silos. Dynamics 365 Sales runs on top of Dataverse, while Dynamics 365 Business Central or Dynamics 365 Finance run on their own databases. Dual-write is an ongoing effort to create the SVT illusion. Power Platform The Power Platform arrived and blew up the whole concept of SVT. Even Microsoft started singing a different tune, promoting their Center of Excellence "COE", so you could more easily manage the possibly thousands of environments (aka Data Silos) that users could now create in your enterprise tenant. So, is SVT dead? The problem was never with "Point Solutions" and their siloed data, it was with "Point Solutions" and silos from other vendors. With the Power Platform, Microsoft created a rocket engine to crank out "Point Solutions"... but these would be "inside the wall". Silos are Good! So now let me be my own devil's advocate. I will take our own organization, Forceworks for example. The Sales side of our business watches over AppSource prospects and website prospects etc. You can probably imagine that with over 50K users of our RapidStartCRM app, that means there were way more prospects than that, who did not move forward. So, we have thousands of prospects and most of these will never amount to anything, of course. Not unlike any other business where the number of prospects is typically exponentially higher than the number of actual customers. The Services side of our business works with our actual customers, not every RapidStartCRM user becomes a customer. Our customers are organizations who have engaged us to support or customize not only RapidStartCRM, but also Dynamics 365 or anything Power Platform related. So, our Service database is a fraction of the size of our Sales database. In our case, Sales runs on a customized version of RapidStartCRM in one environment, and Service runs on another customized version of RapidStartCRM in another environment. The rationale? Why should the service team have to navigate around thousands of irrelevant records? If they are not customers, they don't need to be in the Service silo. But what about Synchronization! Much of "Synchronization" is unnecessary hype. Yet many organizations pay us tons of money to try to achieve it. Flow can handle 90% of what is actually useful. For example, when a prospect in our Sales solution becomes a customer, a simple flow creates the record in the Service solution. If a service customer asks about a new app or service, a simple flow in the service app updates the record in the Sales solution. Unintended Consequences If you have not yet built a flow that acted beyond the scope of what you intended... you have not bult enough flows. Both of our environments have multiple flows, many quite complex, automating a bunch of things. Were all of these in a single environment, the chances of a Service flow accidently scooping in some Sales records for example is much higher. So, flow development becomes much more complex. But what about my 360-degree view of the Customer? Let's face it, you are not going to get around the fact that you will have multiple sources of data. At least with Microsoft, it is possible to have all of those data sources under one roof, which I do not believe can be provided by any other company today. If you really want that 360-degree view, yet another application can give you that, Power BI (Microsoft's Business Intelligence app). Power BI can not only connect, munge together and regurgitate beautiful charts and graphs using data from all of your Microsoft sources, it can bring in most of your external data sources as well. I would still argue that the "360-Degree view" is over-rated, the only positions that might actually need that are very high senior management, and we all know they don't look at data anyway... unless it supports a personal agenda. So that's my take on this. If you are looking to shovel money to someone in pursuit of this dream, hit me up. Or if you just want business applications that "work" for your business, you can also hit me up. Feel free to leave any comment you like, as long as it supports my personal agenda, I am a CEO after all :)…
Microsoft just announced, and released in the next breath, a new Pay as You Go model for Power Apps. This has huge implications for all organizations and also for users of our free RapidStartCRM solution. Let's unpack what it means. Pay as you go Who doesn't like the idea of only paying for what you use? I wish it applied to more things: " I only ate half of this hamburger, so I'll just you pay half the price ", " I only drove my car three days last month, so I'll just pay 10% of my car payment ". " I didn't need to see doctor last year, so I won't pay that health insurance bill. " Sadly, most things don't work that way, but some do, like gas for your car, electricity in your home, and now... your critical business applications! What does this mean? This is a new option, in addition to the previous option of licenses. Before, when thinking about users for your applications, you may have pondered whether Sally would use the app often enough to justify paying for a license for her every month. Or those seasonal staffers, or volunteers who use your app sporadically. With this new model, you don't have to think about any of that anymore. You also don't have to worry about getting and assigning new licenses for newly onboarded staff. You just "Share" the app with them. Cost impacts Basically, in the background Microsoft is watching your app. When Bob signs in and uses it, "cha-ching", Bob is added to your monthly bill. If Bob did not use your app next month, he is not added to your bill for that month. Brilliant! So your monthly bill will go up and down based on how many users used your app in the month. For seasonal staff, maybe you see a cost spike in November, but the cost plummets back down in December for example. How do you get it? Well... it depends. Many organizations use Azure for various things and have an existing Azure subscription. Many do not. An Azure subscription is required as that is where the Pay as you go mechanics are located. If you do not have one, you can go here and create one with a credit card. Once you have an Azure Pay as you Go subscription established, you won't necessarily need to go back there, it is kind of a one-time step. It should take about 10 minutes. Environments The next thing you will need to do is decide which environments you want to utilize Pay as you Go for. Then connect those environments to the Azure Pay as you Go subscription. After that you can just share your apps with any users as you do today. But only pay when the apps are used by those users. Questions Yes this begs more questions than it answers, and some of those details are filtering out as I write this. But I have a feeling this will be a game-changer both for Microsoft and RapidStartCRM customers!…
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Steve reads his Blog
Shortly after we launched RapidStartCRM back in 2015, a couple of competitors followed us into the emerging space we identified. They are gone now, but new ones occasionally pop up. I hear "imitation is the sincerest form of flattery". First Mover Advantage As the very first simple-to-use CRM solution built on Microsoft's Business Applications platform, we did have an early advantage. We brought a lot of SMB knowledge to the offering, and SMBs were eating it up. My assumption that there was a market hungry for CRM, but turned off by the complexity of Dynamics 365 or Salesforce.com, proved correct. Even Microsoft was a promotor of RapidStartCRM, seeing it as a path to capture a segment of the market they were never very good at. But the first mover advantage won't carry you forever. While we may be able to forever claim we were the first, it requires ongoing work to continue to claim we are the best. First Users Advantage Being the first to market is important, but having the first users of a new product, is much more valuable. As an SMB ourselves, we could anticipate many needs for a simple CRM, and we incorporated them into the very first version. But our ability to anticipate needs pales in comparison to actual user feedback. While largely the same application (in appearance) that we launched in 2015, there have been over 25 version updates over those years. Every one of those updates was a direct result of feedback from our growing user base. I see what you did there When we launched, there was no "AppSource", the best our potential competitors could do was watch one of our videos to try and reverse-engineer what we were doing. A few tried, some even copying and pasting our web copy. I was mostly annoyed at the sheer laziness of their efforts. It's a little different today, our app is now available to anyone via AppSource , and not surprisingly of the competitors I am aware of today, each of them had installed RapidStartCRM in advance of launching their copies. Some have at least attempted to take a slightly different approach, yet others simply came up with a catchy name and are basically trying to replicate what they think we are doing. One even pretended to be a customer and reached out with questions! Even Microsoft closely dissected and reviewed RapidStartCRM as they were developing the "Business Edition", the "never launched" predecessor to the Dynamics 365 Professional offers. The Missing Link The primary reason we have had so many updates, while our competition seldom gets past their first one, is the over 50,000 users we have on our app. You don't get that many users launching a knockoff with your fingers crossed. Sure our brand recognition for RapidStartCRM is high, but that would not mean anything if the app was not excellent, and continuously updated as new capabilities come out and features are requested, as long as both of those items fit within our mantra of "Simple-to-Use". We closely evaluate any changes, to ensure we don't trip the touchy complexity wire. This is a lesson some of our aspiring competitors should learn as they replicate our concept, but then proceed to add a bunch of crap to it. Simple isn't Easy You would think that building something simple should be easier than building something advanced... it's not. Even with Microsoft's vast resources, the Dynamics 365 Professional apps that they positioned for SMB, missed the simplicity mark by a mile. The fact that so many SMBs are using the professional apps is a testament more to Microsoft's marketing might, than the apps being appropriate for most of their SMB customers. It's funny how our roles have reversed. When they were first promoting RapidStartCRM it was with an eye towards eventually moving those new customers to Dynamics 365. Instead, many Dynamics 365 customers are moving to RapidStartCRM. Of course I knew this would happen, but I continued to smile as they told me about "their" plans for RapidStartCRM. It's about the Churn In the SaaS software business "Churn" is a critical number. Basically it means that while you successfully sold a customer on your product (Yay!)... they cancelled shortly thereafter (Boo!). While Microsoft does not publish their churn rates, I am aware that for SMB customers, over the years, the churn rate for Business Applications has been very high. Not surprising since Microsoft cannot not grasp the concept of "Simple", a natural by-product of an organization comprised of thousands of engineers. RapidStartCRM's churn rate on the other hand is near zero, the one exception being future competitors of course. Healthy Competition While anyone would want to have a monopoly in their space, it is not realistic in a free enterprise economy. I look forward to "healthy" competition, something that moves the needle forward. But for now, I guess we will have to continue being the ones who move the needle, because knockoffs don't move anything. If you are thinking about a Simple CRM, think RapidStartCRM, the first, with the most users, and still the best, Simple-to-Use CRM built on the Microsoft Power Platform.…
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Steve reads his Blog
1 Your organization (tenant) is over capacity 10:08
10:08 Play Later Play Later Lists Like Liked10:08
Play Later Play Later Lists Like LikedIt seems like a couple of times a week I get a panicked message from a customer who saw the dreaded alert: "Your organization (tenant) is over capacity" in the Power Platform Admin Center. Sometimes they are over a little, and sometimes they are using 500% or more of their allocated capacity. Let's chat about this shall we? Capacity We still have a handful of customers on the "Old Model", the combined "Extra Storage" SKU. If I recall it was $10 USD/GB... and people complained about that. Recently Microsoft changed from the "Additional Storage" model to a "Capacity" model. In the process they split the storage buffet into three entrées: Database Capacity, File Capacity and Log Capacity. They also changed the pricing... significantly. Additional Database Capacity will cost you $40/GB/Month, additional File Capacity goes for a mere $2/GB/Month, and additional Log Capacity comes in at $10/GB/Month. Truing up can be an expensive proposition. What will happen? The first concern of customers seeing this ominous alert is that their business applications will suddenly stop functioning. Clearly this would not be good for Microsoft's business relationship with that customer. So nothing currently running will "stop". However you may notice that will not be able to create new environments, or copy or restore environments, while you are over-capacity. It is not clear if there are any other things that may be happening like throttling your speed, etc., but regardless, you are out of compliance. So while not something you need to solve immediately, you do want to solve it. If you have an urgent issue like needing to copy or restore an environment while you are over capacity, you can request a 30-day extension. Buying your way out For some customers, the least expensive option is to simply buy your way out of capacity debt. We recently had a customer with about 100 Sales Professional licenses inquire whether moving to the Enterprise Sales licenses would be an option. Not a chance, in their case the cost was almost triple, and only got them halfway there. So how much do you get? Many Dynamics 365 customers have no idea how much storage capacity they have, or how they got it. You can get a better understanding in the Power Platform Admin Center . Here is an example screenshot of a tough situation: As you can see this customer is way over their allotment. On the right side you can see how they got their allotment, including their default capacities, additional capacity via additional user licenses (not all licenses include this), and any extra Capacity they may have purchased, all of which sum up to their totals. In this case this customer has quite a few users, but most are on Dynamics 365 "Professional" licenses, which add no capacity. We estimated their cost to true up by just buying the capacity needed with a small cushion would be about $3,300/month. Wow! Alternatives There are several things you can do to help this situation. First we'll tackle the low-hanging fruit, that I can immediately see is their Log storage, which is about 700% over. Since log storage is not very expensive, their cost to get right-side up on this is not that much, about $160/month, so it is not worth having "our" team do anything. But on their own, they can delete some of their old logs, or if they need them, export them out to cold (cheap) storage. They can also look at "what" they are logging to make sure each item needs to be logged, they may have hit the ole "Check all" option when they set it up. The next item to look at is File where they are about 422% over. Again, their cost to get right-side up on this is not that much, about $300/month. On their own they can run some advanced find queries and delete unneeded email and note attachments, and just pay the difference. The cost to do more, would not have an ROI. Lastly, we come to the real problem... Database, where they are also about 435% over. This would be expensive to buy out of @$40/GB, about $3,000/month! This is an area worth having our team dig in and see what can be done... and we did. Solutions and Addons The first thing to understand is that your "Database" holds more than just "your" data. Any solutions you have installed also consume this, including the Dynamics apps themselves. Kind of like how your 16GB iPhone only has like 12GB available before you even touch it. It might seem like there is nothing you can do about this, but if you are not using all of the advanced features of your Dynamics 365 apps, you may want to try RapidStartCRM with it's much smaller solution footprint. Speaking of solutions, and the capacity they consume, you should definitely review any addon solutions you may have installed and are not using anymore. Just delete them. For those you need, make sure you are on the latest versions, as many ISV's have made their code more efficient now that capacity is an issue. If you have some old addons, with no recent updates, you may want to consider switching them for more modern ones with similar capabilities. If you are stuck with an old addon for some reason, maybe hire a developer like us to do a code review. Again, the Capacity issue is recent, previously ISVs for addons did not really worry much about storage, so efficient code was not a priority. Normal Data Of course every time a new record, like a Contact for example, is added, all of the data entered into each of those fields is added to the database. So think about all of the records you have, not just the obvious ones like Accounts and Contacts, but also activities, etc. it creates a huge pile of data. Of that huge pile, your team is probably only engaging with a fraction of it on a daily basis. Before capacity was an issue, there was no reason not to keep 10 year-old emails, but now you have to think about it. The same goes for any "inactive" records. The first question is "Do I need this at all?", if the answer is still "yes", then the next question is "Do I need it to be in here?". Probably not. It may make sense to archive that data to cold (cheap) storage. Bonus result: your system will run faster! Transactional Data Some customers generate enormous volumes of "Transactional" data, often automatically imported via an integration. Do you need to see each of these transactions in your database, or would a summary of totals do the trick? If you do need to see it all, could it be moved to "colder" storage and accessed by your users via " Virtual Tables ". Import History When you import a csv or other data file into your Dataverse environment, like via data import in Dynamics 365, that excel or other file remains behind after it has been parsed and added as records. You can free up some space by deleting these import files, just make sure you don't check to "delete all records imported" also. Indexes Here's another thing you can look at that could have an impact. If Quick Find lookups are configured for data that's frequently used, this will also create additional capacity-hungry indexes in the database. Admin-configured Quick Find values can increase the size of the indexes based on: The number of columns chosen and the data type of those columns. The volume of rows for the tables and columns. The complexity of the database structure. Because custom Quick Find lookups are created by an admin in the org, these can be user-controlled. Admins can reduce some of the storage used by these custom indexes by doing the following: Removing unneeded columns and/or tables Eliminating multiline text columns from inclusion Bulk Delete Jobs You can create bulk delete jobs for two things, first for the initial cleaning up, and second to help to keep clean. You can use bulk delete to clear out old records of all kinds initially, old emails or attachments, completed system jobs, etc. Afterwards, you can them be recurring, so they automatically clear this old data on your schedule. Unused Environments All environments consume a minimum of 1GB... even if they don't have a Dataverse database. So you should regularly review your list of environments in the Power Platform Admin Center , and remove any that are not being actively used. Even some that are being used, should be reviewed to make sure they are necessary. Be aware, that unless you have deactivated the capability, by default any user in your organization can create an environment. We frequently find environment "experiments" that were created, and abandoned by users, including users who are no longer with the organization! Note that Default, Production, and Sandbox environments are all counted for capacity, however Trial, Preview, Support, and Developer environments are not counted. Conclusion If after doing all of these things, you are still over-capacity, you may have no option but to buy more. Depending on your specific scenario, some or all of these steps may have significant to very little effect. But it's definitely worth a try. Based on the potential expense, we saw a new business opportunity and recently launched puredata.estate . Maybe we can help you.…
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Steve reads his Blog
1 ”Even after everything, we still have adoption problems” 7:10
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Play Later Play Later Lists Like LikedOne of the smartest things I have done in a while was to introduce a monthly Principals call with our customers. Our customers are all very happy with our team, so why rock the boat by injecting myself? For the same reason I might tell the waiter that my food is "fine" when it isn't. The Owner's Dilemma Every single day people go into a restaurant and have a sub-par meal. It seems the wait staff everywhere has been trained to ask leading questions, like "isn't your steak great?", with a huge smile on their face. Like many people, it's easier to just say "it's fine", rather than interfere with their smile. Instead, I just make a decision to not come back. Meanwhile, the owner asks smiley how things are going, and they reply, "Well people seem to love your food!". Which leaves the owner wondering why sales are down. Our sales are fine, but I'm not taking any chances. How's it Going? I have no interest in a "feel good" conversation with my customers. Instead, I am more like a Business Applications detective, asking hard questions, probing for the real issues. It was on one of these recent Principals calls that a customer conceded that they were having adoption problems. Ugh... the perennial bane of Business Applications. This particular customer was on Dynamics 365. In addition, they had bought basically everything that Microsoft business applications group offers, including Dynamics 365 Marketing, Customer Insights, Power B.I., oh... and a few more "Insights". They had also built out an extensive user training library. It seems like they had done everything possible to insure adoption, yet for a particular group they were struggling. Carrot, Stick or Both The usual way most organizations approach adoption is, "Use it, or else". Or else what? This seems to range from, "you'll get a reprimand (oh no!)" to "you're fired (oh shit!)", with a lot of options in between. The growth in "work from home" has not helped the adoption challenge. A few other organizations try the more "touchy/feely" approach. "If you use the system, we'll enter you in a drawing for a "NEW CAR!!!" And still other organizations use both, you either get a new car, or you get fired. (You have to say that in your best Alec Baldwin voice.) Damn Salespeople Most organizations have workable adoption from their administrative staff, and pretty good adoption from their support staff. It never fails, when I hear this concern, it is always related to the sales staff. For this particular customer they had an even bigger challenge in that their key sales staff is made up older "Rainmakers". Rainmakers Most businesses have a sales team. Within that team you have mostly average sales people, but often there will be a few that make most of your sales. The 80/20 rule applies. These are your "Rainmakers". Any other salesperson could quit and you wouldn't bat an eye, but if a Rainmaker quit... it would keep you up at night. Rainmakers are rainmakers because they are smart, and smart enough to know that they are Rainmakers... with leverage. The kind of leverage that, if they don't use your system, they know nothing will happen. They are completely unmotivated by your pleas to track their sales activities. So your forecasts are shit. Whether you are heading for your record high month, or record low month, you won't discover until the following month. Herein lies the challenge. Attempts so Far The Rainmaker challenge was not lost on this customer, and they initiated several efforts to overcome it. More training materials of course, and an ongoing effort to make their apps simpler to use. Not unimportant, but not effective either. In my experience the only way to motivate a Rainmaker is to provide them with a tool that makes them more money by using it, than not. Full Stop! Easier said than done, but all other efforts are window dressing. Some Ideas for thought Vlad, a Principal in our organization on the call, suggested playing to ego as one idea. If you know you are are a Rainmaker and won't be fired, it can definitely swell your self-importance, leading to exponential ego growth. If you have been to a car dealer, you may have seen "The Board". Usually a white board visible to all salespeople showing who is at the top in sales so far that month. While Rainmakers will always be in the top 3, being at the very top is food for their ego. Motivation and Manipulation are often the same thing. Vlad's thought was to start tracking the leaderboard, and sending periodic notices to the sales team to login to see it. While there is no silver bullet for adoption, this could motivate a segment. Day in the Life Another more abstract idea of mine was more in the line of making them more money by using the system, shifting from their Ego to their Greed. Maybe you are offended by that term, but let's be honest, the best salespeople are usually greedy egomaniacs, and most companies need them anyway. Most of them also have their "secret sauce", their unique "process" if you will. If you understand their process, you can use your system to possibly grease their wheels for them. In many cases, getting them to share their secrets may be a challenge, so some forensic analysis on their past wins may provide some clues. The goal is to give them a self-serving reason to use the system. Outlook and Memory I find that many of these Rainmakers use a combination of Outlook and their memory to manage their pipeline. Ask any of them how well that is working for them and they will all say "Great! The only way I have ever done it!". Newsflash, your memory is shit, and Outlook is a mail program that can't keep track of anything. If they had ten deals going on, they probably could not name six of them off the top of their head. The four they would remember are the ones closest to becoming money in their pockets. These may not even be the best deals financially for them, they are just the closest. It's Sales Human Nature. So my goal was not to "solve" you adoption issues in this post, but spark some ideas. I would love to hear your other Rainmaker adoption ideas in the comments below.…
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Steve reads his Blog
1 We Upgraded from Dynamics 365 to RapidStart CRM 7:53
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Play Later Play Later Lists Like LikedI have had my head down for a while working on the next version of RapidStart CRM. We also recently deployed RapidStart CRM for our own support operations. In the process, I came across a few items that I thought would be of interest to the users of our free app, and since they would also work for any Power App, including Dynamics 365, I thought I might discuss them. Next Version Before I get into this, I want to clarify what I mean by "Next Version" of RapidStart CRM. We have been developing this product since 2015 when we launched it a the Worldwide Partner Conference (Now called Inspire). Over the years we had made hundreds of updates and tweaks in direct response to users. We also refactored the solution a couple of years ago to run on the low cost Power Apps licenses in addition to Dynamics 365. Each update, with the exception of the refactoring, had progressively fewer changes as we honed in on our target customers' requirements. I am pleased to inform you that the next version will have the fewest tweaks yet... I mean it is damn near perfect already. So let's get back to our internal project. Forceworks Support We had been running our support operation on Dynamics 365 Customer Engagement for over 10 years. Several times I had contemplated moving it to RapidStart CRM, but as a certified partner my licenses were free, so I kept putting it on the back burner. Our support operation is not very complicated. Customers buy blocks of hours which we add to their bank, and we track our activities against those blocks. We also maintain a portal where customers can login and see their bank balance as well as review all activities. We had been using a third-party portal since before Microsoft even contemplated a portal product. The portal company had been purchased by another company for other assets of value to them and the portal product came with the package. But portals was not a priority for them. I figured it was a matter of time before they shut it down. So the time had come to move. Dynamics 365 So, as I said I get Dynamics 365 licenses at no cost. So it might seem an obvious choice just to fire up a Power Apps Portal and connect it to our existing instance. and be done. However, as years have gone by now with us supporting customers on RapidStart CRM, many of whom had moved to it from Dynamics 365, I have come to not really like Microsoft's first-party apps very much. I truly feel they are unnecessarily complicated and bloated. And while my licenses may be free, any additional database capacity is not. Our instance, even though it was not doing all that much, was consuming the lion's share of our capacity. So I made the decision to "upgrade" our support operation off of Dynamics 365 and on to our own RapidStart CRM. Also, Power Apps Portals works the same on RapidStart CRM, so there was no reason to continue with the bloated beast. And, if for some reason I was no longer getting free licenses, my cost would be about $10 vs. $95 per user... a factor in many other customers' "upgrading". Migration We could have done this upgrade/migration in a day, but I took this opportunity to make some improvements to our process. Mainly around automation, nothing we could not have done before, but this was a good time, since we were opening things up. We started with the same RapidStart CRM solution as our customers get, and installed it from AppSource on a new environment the same way any customer would. We made use of the RapidStart CRM Accounts, Contacts and Cases. We created two custom Tables, one for Case Notes, to track time and activities, and one for Support Hours, to track the customers' purchases and banks. We also created several Cloud Flows with Power Automate... things like calculating hours and various customer notifications. In addition, we added some specific charts to the RapidStart CRM dashboards for quickly getting a view of things. We also tweaked the RapidStart CRM App to hide Opportunities and a couple of other items we were not using for this need. Lastly, we mapped and migrated all of our historical data to the new environment. I didn't even pause before I hit the "delete" button on our old bloated environment we had depended on for 10 years. Portals So I mentioned that Microsoft offers a Power Apps Portal. Again, for me it would cost nothing. Depending our your requirements, it might be a good solution for you. Unfortunately, like everything the Microsoft Business Applications group produces... it is more complicated than necessary. This is even more noticeable when your requirements are simple. Our requirement was to have a place customers could log into and see their account information, purchase history, case information and case notes. I wanted it to be clean, simple and easy to maintain. Not too complicated. Our Forceworks main website runs on WordPress, like so many other small to mid-sized businesses. So my preference was a WordPress based portal. My friend, and fellow MVP, George Doubinski had the answer. The AlexaCRM WordPress integration solution. Using Alexa, we are able to display any information we want from our RapidStart CRM environment on any WordPress posts or pages. For us, it was a better solution. AlexaCRM can do much more, I am aware of customers running full eCommerce portals with it! If you let George know that you heard about his solution from this post, he promised me he would sing you a short song of your choice. Power Automate Our previous environment had used classic workflows for everything, so this was a good time to move those to Power Automate Cloud Flows. However, I am not 100% sold on Power Automate... yet. Classic workflows still exist because Microsoft has not yet reached parity with Power Automate to be able to turn them off. The "Fullness of Time" does seem to be quite full indeed. But I decided to use Cloud Flows wherever possible. It seems that every time I look for a connector in their expansive list of hundreds, it either does not exist, or does not do what I need it to. This was the case for WordPress also. The connector exists... but is essentially useless. Once again, a fellow MVP to the rescue. Heidi Nuehauser is working with Nick Hance at Reenhanced , and they have a rock-solid Power Automate connector for WordPress that can be used with either Gravity Forms or Contact 7 forms on your WordPress site. If you use the code FORCEWORKS, you can try it out for a month for free. BTW, I did not actually need the Reenhanced connector for our Support site, but while I was under the hood, I decided to update all of the forms on our main Forceworks and RapidStart CRM websites. So now all forms submitted create a record in Dataverse automagically. Results Since our Support Portal is not public (unless you want to buy some hours), I added some screenshots below for your reference. If you would be interested in a similar solution, please contact Forceworks . Account Summary Page Cases Page Case Details Page…
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Steve reads his Blog
I have had my head down working on some big things, and it has been a while since you heard from me. Well, I'm getting back to it with a follow-up chat with Toby Bowers, the Leader of the Microsoft Bizapps ISV Program. I managed to catch him in his car, and got a great update on some new things happening in the ISV arena. Enjoy! Transcript Below: Toby: Hi, this is Toby. Steve: Hey Toby, Steve Mordue, how's it going? Toby: Hey, Steve. I'm doing well. Thanks. How are you? Steve: Not too bad. I catch you at a decent time? Toby: You've caught me at a fine time. I'm actually in the car at the moment. I'm just taking my team out for a little celebratory launch after our big Inspire event and also our Ready event earlier this week. So it's actually a good time. Let me just pull over so we can have a chat. Steve: It's Been a pretty frantic couple of weeks for you guys. Toby: Frantic, but good. Yeah. Yeah. We had a great showing at Inspire. We made some exciting announcements across the business applications business, but especially around our ISV program, ISV Connect, as you and I have chatted about before. So, it's been good. Steve: Well that's [crosstalk 00:00:50]- Toby: How about you [crosstalk 00:00:51]. Steve: [crosstalk 00:00:51] the reason for my call is to try and catch up on ISV Connect. We talked some time ago about some things that you kind of had just inherited this role from Googs who moved on and were kind of getting your feet wet. Now you've had a close to a year in this position, right? Toby: Yeah, that's right. That's right. I remember our initial chat and I think in fact I'm guilty, Steve, because we agreed to speak a little bit more often, but it's been an interesting year this past year, as we all know, but yeah, it's been almost a full year of execution since we last spoke and I even remember Steve, the nice article you wrote with some suggestions for me as I sort of took over. Toby: Yeah, I'd love to actually go back to that. We can talk about a little bit about some of the enhancements and announcements that we made last week. Steve: Yeah. I mean last week, I think for a lot of the ISV's that they weren't thrilled with some things as the program got launched, they were starting to kind of get their arms around it. But some of these announcements that I was hearing and hopefully we can talk about today, anything of course isn't NDA, I think should make the ISV community pretty happy. It's making me pretty happy. And really kind of throw some gas on that fire. Toby: Yeah. Well, absolutely. I'd love to reinforce it. I know, I know you get a lot of people listening to your impromptu calls here. So why don't I do this? Let me maybe just set a little bit of context, just kind of where we left off Steve, and then I can hit on the high notes of what we announced and then we can dive into any particular areas. That sound all right? Steve: Yeah. You are pulled over, right? Toby: I am pulled over now, yes. Steve: Okay. Toby: You got my full attention. Steve: All right sure, kind of hit some of the highlights. Toby: Yeah. Yeah, for sure. Well, for those who don't know, we originally set out with the ISV Connect program a couple of years ago to attract ISV's to our platform, building and extending upon it. That platform being both Dynamics 365 and the power platform with a specific focus on partners who had great industry or vertical IP to enhance the portfolio and delivering better value to our joint customers. So through the program itself, it's a revenue share program and we reinvest back in the ecosystem in the form of platform benefits, go to market benefits, co-selling with our field. Toby: So when I sort of took over Steve, I wanted to sort of get a full year of execution in place. And in that first year we were pretty happy with the numbers. We have over 700 ISV's enrolled in the program. Now we use AppSource as sort of the cornerstone of the program. We have, we have 1400 apps or more certified in AppSource. But after that first year, I really with the team wanted to understand how things were landing, and I think your feedback was good Steve. We did a bunch of research. We do partner satisfaction surveys. I of course talked to a lot of partners in my travels. Steve: [crosstalk 00:03:59] in a year's time, you can kind of get a pretty good gauge on what was working well? What could work better? What wasn't working well? What do we need to just abandon? What do we need to step on? And I kind of got the feeling that was this readjustment that we just saw was kind of bringing some of those things to light. Toby: That's exactly right Steve. I mean, it's such a diverse ecosystem of emerging partners to large mature partners across a pretty vast portfolio. So, it was a diverse set of feedback, but you're spot on. We wanted to give it a little bit of time, but then check in and listen and make some adjustments. So that's what we did, based on a lot of the feedback we got. Toby: I'd sort of summarize what we changed in three big areas Steve, the first is that the business model itself, the fee structure, and we talked about this last time, but not only having an investible model where you can reinvest, but actually investing in the ecosystem, especially as it's growing like this business is growing. Toby: The second thing was a lot of feedback around the go to market, whether it was the marketing benefits, the co-selling with our field, really just getting that value proposition right Steve, and really delivering on the promise we made. We needed to balance that equation a little bit and equalize the effort. Toby: And then the third piece is really around the platform itself. And again, we've talked about this in the past, but just the platform, the tooling, dev test environments, app sources, and marketplace itself. Toby: So those were the three key areas that we sort of listened and got a lot of good feedback around. So with that in mind, what we actually announced at the event is that first of all, back on the business model we're significantly reducing the rev share fees down from 10 and 20%, which you might recall, we had a standard tier and a premium tier. So we were bringing those fees down from 10 and 20% to 3%, just a flat 3% going forward. Steve: That's across the board? Toby: That's across the board. And in fact, it was part of a broader announcement we made as Microsoft, Steve, where we're also bringing our commercial marketplace fees, so that's both Azure Marketplace and app sources. We get transact capabilities down to that same flat 3%. Steve: So what's the motivation behind that? I mean, what is it that they're hoping that will accomplish for Microsoft? Toby: Yeah, it's interesting. If you catch any of the sessions, even starting with Satya, he really talks about Microsoft wanting to be the platform for platform creators. And then if you parlay that into what Nick Parker said and Charlotte Marconi around being the best platform for partners to do business on, it really just came down to helping the partners keep more of their margin to invest in their growth. Toby: So it's not a P&L, a profit center for Microsoft. It's a way to deliver benefits. We think it's pretty differentiated in the market compared to some of our peers. And it was sort of interesting to see, because we were planning on bringing the fees down for ISV Connect specifically, and then we started to align across the organization and just thought, gosh, we should just do this in a very consistent way across the entire Microsoft Cloud with that one flat 3%. Steve: So the math equation had to work out something like, if we dropped this to 3%, that's going to grow that side of the business significantly, which is going to increase platform sales, right? There has to be an up for the down. And I guess maybe... I mean, not that the platform wasn't already growing by leaps and bounds, but somebody must've been thinking this thing can grow a lot faster if we get rid of some of these hurdles. Toby: You're exactly right. I mean, it's kind of what we've talked about in the past. Just the value that an ISV ecosystem brings to Microsoft with that, whether it's the industry relevance, industry specific IP, or just a growing ecosystem in general. I don't know if you'd caught what we just did, our earnings earlier this week, but Dynamics 365 is growing 43% year over year, we doubled our power apps customer base. And so to your point, the business is growing, the platform is growing, and we want the ecosystem to grow and we want to attract as many partners to do that as possible. Steve: So, I mean, you can't reduce fees and increase the benefit, you have to have taken some things away or maybe gotten rid of some things that weren't being utilized, or how did that kind of offset? Toby: Yeah. Great question. Yeah, so we are investing deliberately to build this out and kind of putting our money where our mouth is, but we did, you're spot on. We learned a lot around the benefits, the go to market benefits in particular, the second key thing we announced is that we are reducing just down to one tier at that flat 3%. So no more 10% and 20% or a standard and a premium tier. And we're reducing the thresholds within that one tier for partners to unlock those go to market benefits and those marketing benefits. And then what I heard, especially from partners, again, to my point around, you've got some mature partners and some emerging partners, it's not a one size fits all. And so we've got an option sort of an, a lA carte, option for partners to choose marketing benefits that make the most sense for their business. So we just tried to simplify things and streamline things a little bit. Steve: You know, I talked to a lot of partners. We're, kind of unique in that our application is free. So, the revenue shared didn't really come into play for what we were doing because there wasn't a fee for our app or any recurring services with it. But you know, a lot of these ISV's their business is significantly different. They've got revenue generating applications that run on top of your platform. Many of them that kind of told me in confidence that they just weren't paying the fees. They were getting the notice from Microsoft saying, "Hey, please do us a favor and tell us how much money you've made and what you owe us." And many of them were just kind of ignoring that. Steve: I guess if we're getting down into a 3% range, it'd probably make it a little easier for some people to be more honest about things too you think? Toby: Yeah. Well, yeah we hope so. Again, that was kind of my point around balancing the equation and making sure that we're delivering on the promise that we set out with the program itself. And I talked to a lot of partners as well, and there's definitely benefit being realized, whether it's from a marketing perspective or co-selling with our field, again, based on what's important to their business, but you're right, we do think by reducing it to this level and also just getting better at delivering the benefits in a consistent way, we'll have more partners participating in the program. Toby: The one thing I would say, Steve, that I was just going to close off on with this sort of consistency across Microsoft is we also realized that's our value proposition. If we can not only have a similar model with the 3% marketplace fee and ISV Connect fees across Microsoft, but a similar model to the way we deliver those benefits, to the way we engage with technical resources or engage from a co-selling perspective across Azure Teams and 365 Dynamics Power Platform, that's kind of how we differentiate ourselves versus, the rest of the players out in the market. Toby: So we made a bunch of enhancements and announcements across the business Azure teams, ISV Connect obviously, and you'll see us continue to sort of work towards a much more consistent approach from a Microsoft Cloud perspective, because obviously we'd love it if partners were integrating with Teams. We have over 250 million monthly active users with Teams now driving dynamics integrations all the way through to CDM and Dataverse and integration into Azure Synapse. Those are the partners we want to work with and the type of partners we want to support and go to market with. Steve: Well, I'll tell you, I think the 3% has probably eliminated a hurdle for a partner, certainly I remember at the time a lot of partners complaining about the 10 and 20 saying things like, "If it was like three." Okay, well it's three now, so shut up and move forward. Toby: Yeah. We've had a lot of- Steve: And it's interesting, because it's kind of the way we sell is I guess for an industry ISV who built something specifically for Dynamics 365, maybe they approach things a little different. Our approach is more, we really try and sell the potential of the platform because we've got a simple CRM. So we're up against a lot of competing simple CRMs. And when you open one of their CRMs and open, rapid start, for example, they look very similar and do very similar things. So for us, we really have to sell the value proposition of, hey, behind that little CRM that you're using from Acme Cloud CRM company is really nothing. You've got the extent of what you can do with that right there in front of you and there's nothing more that can be done, and we really lean in hard on the potential for things like integration with Teams, with things like integration with Azure. Steve: Obviously the integration with Microsoft 365, all of the pieces that are available in the power platform that we haven't enabled in our app that are there to be enabled, you like the forums and some of the AI stuff, it definitely seems to be a huge differentiator in that sales conversation. Toby: Yeah. Well, that's great to hear that's really what we're trying to get right and stitch together the teams if they exist across Microsoft and iron those out. I think your company is a great example of that Steve, and I know you talked to a bunch of our partners and sort of as an independent third party, we had a few partners join us at inspire. Icertis has been a longstanding partner of ours. They're a similar story from, from Azure Dynamics Teams really across the board, and getting more and more focused on industry solutions with their particular IP. Toby: And then we had more emerging partners like Karma, Frank at Karma talked to us about some of the benefits we're building into the platform, specifically license management, and now he's taken advantage of that. And we have big partners like Sycor, that's been working with us for a long time on the Azure side of the business and is doing some really interesting things now on the dynamic side and sees value in that co-sell motion. Toby: So I think that value prop is what we're trying to land, and then we're seeing lots of different types of partners take advantage of it in different ways, which is great to see. Steve: Yeah, it's not often that you see both a cost of participation come down and the value of the benefits go up. And when we talk about benefits, and before, you and I have talked about some of these go to market benefits, there's a segment of ISV's that could make use of those probably mostly new ISV's that don't really understand that system. Steve: But for a lot of the ISV's, they really didn't see value there, but in the meantime they're maintaining their own licensing systems and their own transaction systems and things like that, which as an ISV, that's just like a tax. You're building your solution to solve a particular problem, but you can't just stop after you built this wonderful solution, you got to protect it, you got to monetize it. So those things ended up being just kind of attacks. Steve: And, every ISV out there has had to kind of build their own system for licensing and transacting. And you guys coming through now recently here would be with the licensing capability we were in that pilot, and that thing's got some great potential, a couple of things left for them to do on that to get that really where it's going to solve a lot of problems that ISV's have had, even with their own licensing. Steve: Because with your own external licensing system, you can only do so much, but working with one that's on the platform, that's essentially the same one you guys are utilizing, is going to be huge for ISV's, and then we'll get to transactability, that's just going to close another piece that ISV's have had to deal with, especially when you talk about those startup ISV's, they know an industry and they can build an app, but when it comes to licensing and transacting, and if they can just tick a button and plug right into a couple of those things, that's going to lower the bar to entry and make it a lot easier for some of those folks to get in I think. Toby: Yeah, I hope that you're right Steve, in fact, I didn't know you were working with Julian Payor and the team on piloting the license management stuff. It's great to hear your feedback. That was kind of the whole intent with the journey. If I rewind a bit with AppSource itself, you'll recall we had to do quite a bit of work on the overall user experience for AppSource. We worked hard with the engineering team to improve that, improve discoverability and search capabilities and just sort of the plumbing underneath. And then the next step was, was licensed management, which we've just GA'd working again with the engineering team, and then from there, to your point, the value proposition, a lot of ISV's put all this together and then you add transactability and the ability to actually sell your stuff on our marketplace to what's now more than 4 million monthly shoppers, going to that destination is it is definitely a point of value that I've heard positive feedback from ISV's on. Toby: So that's why we really invested there. I know it's taking us a little bit of time to get there, but that was another key announcement. We announced license management later in the fiscal year. We'll have translatability and AppSource for our customer engagement apps, for power apps, and then we'll continue to roll out a roadmap from there. Toby: And then the other piece I forgot to mention Steve, we made some noise about as well, was these new sandbox environments. And I know you've given me this feedback before, but you know, sort of in the broader internal use rights world, the value in having sandbox environments for our partners to do dev tests and do customer demos around, I heard loud and clear from you and from other partners. And so that's the other thing we announced. We have these new discounted skews, which are basically just at cost skews across the business for those dev test environments. And then for partners who are participating in ISV Connect and hitting those new lower reduced rev share thresholds, we'll provide those licenses for free. Toby: So we think that's going to be a great new benefit for partners as well, more on that technical and platform side of things. Steve: Yeah. Particularly for the ISV's, because ISV's don't necessarily see a lot of value or need to get Microsoft competencies. Competencies are definitely, as a program that was designed for resellers to demonstrate their competence. But a lot of ISV's don't want to have a need for that. And that's where [inaudible 00:19:22] had historically kind of been tied was to those competencies. Steve: So is there any talk about any sort of... I mean, they did do that kind of short-lived ISV competency, which was primarily around, hey, if you've got an app in AppSource you qualify. Here's some IUR. Steve: So this new program will replace that, but are they going to be revisiting any sort ISV competencies or need? Toby: Yeah, well I won't say too much as far as future plans are concerned, but what I can say Steve is that we did this for biz apps, we did it for ISV Connect because that's our program and we got feedback and we think there's value in that. Toby: I did mention that going forward we'll have a more consistent approach across Microsoft Cloud. There's lots of different benefits out there. Azure Credits, we announced some new things around Teams. And so we just need to, as one Microsoft, provide that to our partners in a consistent delivery through these benefits so that we can support that kind of value proposition we talked about earlier. So look for more from us in that area. You're spot on, on the competency side. And I wouldn't even say resellers, I'd say more SI, system integrators services partners. Steve: Yeah. Toby: The key difference there is, we want those guys to be able to differentiate their organization. As a company, you can say, "I've got 15 certified individuals in this role-based certification. And I've got this many credits to my business that make me a gold partner at an organization level"- Steve: Which is something a customer looking at SI would be looking for. Toby: Right. Steve: But when you're looking at an ISV solution, they're really just looking at the functionality. Toby: It's the app, right? You would want to badge in app versus badge and organization. And so that's the key difference there. And I think we've kind of figured that out and again, you'll see us do more in that space going forward. Steve: Yeah. I just want to mention, just go back for a second to make sure everybody is aware that the transactability and the licensing are optional. These are things that you can take advantage of if you spend a ton of money on your own systems, nobody's going to expect you to rip and replace. These are really designed for... I mean when I think of a partner like myself, if I can get out of the license management and have transactability just be automatic, where all I really have to do is focus on building my IP, getting it in AppSource, hopefully promoting it properly, but then the licensing becomes automatic and the transactability becomes automatic, and I'm just getting money coming into my account. Of course, you guys are scraping your 3%, which I don't begrudge because your given me those tools. That just makes things a lot easier. Toby: That's right. And you're right, it's not mandatory. It's again what makes sense for the partner. And so, you can do business with us and ISV Connect outside of the marketplace and work with us on the new 3%, get those benefits, or you can transact in the marketplace, it's that same 3%. And it's a different benefit. You get that whole commerce system, you get that whole billing engine. You don't have to worry about that. And there's a lot of ISV's out there that see value in that. So yeah, you're spot on. Steve: Yeah. I remember Goose had kind of recharacterized the revenue share after the kind of flap up from some of the ISV's about the benefits and stuff and he recharacterized it as a cost for the use of the platform that you're building on top of a platform that Microsoft has built, Microsoft maintains, Microsoft advances. So look at that as a cost for that. And I think you still kind of need to look at that as a cost for that. It's not 3% for licensing and transactability, it's a cost for maintaining the platform, there's these pieces you can take advantage of or not. But if you're not taking advantage of license management, transactability, it doesn't mean you don't have to pay the fee. You're paying the fee for something else. Toby: Yeah. Steve: I'm trying to head off some things I know I may hear from some folks [inaudible 00:23:24] licensing. No, no, no. Toby: Yeah, yeah, yeah. You're right. You're right, Steve, and again, to zoom back out again, I mean, it's not about the 3%, it's about attracting partners to build on the broader Microsoft Cloud and supporting their business in a way that works for them. And you're right, there is a cost of doing that, but we want to invest, and I think we just sent a message hopefully to the market that we want to be aggressive in this space, we think we're well positioned, we've got a great value proposition with this broader Microsoft Cloud thing that we're just seeing incredible growth across the business. Toby: And I guess most importantly, we're listening back to that, after a full year, really sort of staying in tune to feedback from partners like yourself, that [inaudible 00:24:07] at large to make sure that we're doing the right thing and delivering, that's kind of what was most important to me. Steve: So those discounted skews for ISV's, in order to qualify for that, what do they need to do? They need to join ISV Connect? Toby: Yeah. So the discounted licenses, which are again, just basically at cost for us, are available to anyone who's enrolled in ISV Connect. All you need to do is enroll in the program, but then if you hit the new reduced rev share threshold that sort of unlocks additional benefits, then we'll give those licenses to you for free. And I can't here in the car, remember all the details of the numbers and stuff like that, I think, and you probably have it. I think aka.ms.bizapp.ISV connect, I think that's a link to our website that has all the benefit details and stuff, but that's basically the way it works. Steve: Are those available today? Toby: They are. There's a whole bunch of them available today and there's more coming. I know that the sales service, field service, marketing, I think the customer insights products, maybe commerce, I might be forgetting a few others and then there's more coming down the pike shortly. Steve: All right. So a good reason for people to go back to revisit ISV Connect site if they haven't in a while. Toby: I would love that. Yeah, I think so. If we can get people to go back and like you said, revisit, just get educated, hopefully get re-engaged and then keep the feedback coming. That's a great outcome. Steve: So I've had a few ISV's asking me about what's the future of ISV Embed, and maybe you can speak to that because that one's kind of a little vague, I think, for a lot of folks right now. Toby: Yeah. It's a great question Steve, that's kind of next, next on our list. And again, today I can't share a lot of specifics, but this is a good topic for us to come back to probably in our regular chats. Toby: As you know, Cloud Embed is a model that supports kind of like an OEM like model where a partner's just packaging their IP directly on the underlying license and selling it together through our ISV Cloud Embed program, which leverages our CSP vehicle as a way to transact. And so we've had it out there for a couple of years. And I may have mentioned before that we're sort of modernizing a whole bunch of our commerce capabilities and new business models and so we're working on a few different options still to support that embed scenario where things like co-selling with our field or certain other marketing benefits aren't the most important thing for a particular ISV in a particular scenario, they don't want to have to mess with reselling the underlying dynamics license. They're not resellers. They just want to sell their IP. Steve: Yeah. Toby: So we're working on some stuff there, especially, on both the core dynamics business and the power platform business. So we can stay in touch and I can come back to you for some feedback once we have more to share. Steve: Yeah. That, I mean, that program worked for a particular kind of an ISV. Toby: Yeah. Steve: A lot of the ISV's that have add on solutions that are not SI's, there's a partner already involved with a customer and they just want to sell their add on solution. Steve: Yeah. Licenses have probably already been sold by that partner. They don't want or need to get involved in that management of that sort of stuff. They just want to sell their IP. And then there's some ISV's that the customer is actually buying, which I think we're starting to see now. And I think I told you this before, one of the things that Salesforce had going for them with their ISV's was there were a lot of very robust ISV's that did a lot of direct marketing to customers about their solution and less so about the fact that it ran on Salesforce. Steve: Salesforce is this platform in the background, but this is what we're selling is this ISV solution, and in that scenario they own the customer because the customer wasn't buying Salesforce, they really were buying the solution to their problem for this ISV, and we hadn't seen as much of that on the dynamic side for a long time. It was definitely, you start with dynamics and then you add on ISV features and capabilities. But I think we're starting to see more of that, that holistic ISV solution that a customer is buying the solution that happens to run on the power platform or on dynamics. Toby: Totally. That's the scenario we see mutual opportunity in. That example, you said where the ISV owns the partner or the customer, the relationship with the customer, frankly that helps us reach more customers as Microsoft. And then if we provide that ISV still the underlying technology and the right business model to support their business, then that's goodness on both sides. So, that's exactly [crosstalk 00:29:10]. Steve: So that's the one where ISV Embed probably makes the most sense, , that type of partner. So we're starting to see more of them. Toby: That's great. That's great. Well, I always appreciate the feedback if you have any. So I'd love you to go through these new things in a bit more detail, and then send me your feedback and we can continue to keep the lines of communication open as always. Steve: I'm not letting you off just yet. I'm keeping you for a couple more. Toby: Oh man, I've got my team waiting, I'm hungry Steve. Steve: I just want to ask, "What is the most exciting thing you're seeing in the space coming soon that people should really be paying attention to?" I know we've got some things happening that aren't so much related to ISV, like the power platform pricing coming down, but what are some of the things that you're seeing in your group, or maybe some things that are already out there that you're feeling like ISV's are not understanding what this is obviously or they'd be all over it? Toby: Hmm. That's a great question. I'd say probably two things. One is, again, one of the big announcements we made at Inspire that wasn't necessarily related to ISV's or ISV Connect specifically, but what we announced with Teams where Teams users will now be able to sort of view and collaborate on Dynamics 365 records from directly within Teams. Toby: So this concept of collaborative apps you'll see, and that's at no additional cost. Obviously that concept you'll see us continue to do more around to bring that again, pretty large install base of Teams users that are out there, 250-million now, together with Dynamics, we think is sort of unique to our value proposition. So there was [crosstalk 00:30:58]- Steve: So this is somebody you think ISV's out there should definitely go do a little bit of investigating into the Team story? Toby: Yes, yes. Teams on the front end, it's such a large install base that we can take advantage of as partners. And then on the backend, I mentioned that again, power platform, Dataverse, leveraging our data services like Azure Synapse Analytics, again, stitching that all the way from the front end of the backend. We as Microsoft, we're really focused on that combined Microsoft Cloud story. And I think the partners that are recognizing that and investing in that with their own IP are the ones we're going to engage with and hopefully generate some good opportunity around. Toby: The second one, in that vein Steve, the second one I was going to say is just what we continue to do with our industry clouds. So we have cloud for healthcare out there at the moment, we've got financial services, manufacturing, retail, we announced the cloud for sustainability, we've got not-for-profit. So, these things continue to roll off the conveyor belt, but it's such a great opportunity. I was sort of surprised with how much interest we had from the ISV ecosystem around these industry clouds. Obviously as we build more industry IP, we need to sort of adjust our relationship with our partners who serve those industries, but there's still so much space to add, specific IP to that industry and work with some of those very credible industry partners that we were sort of talking about just a moment ago is a big place that we're going to invest going forward. So, that's an area I'd encourage people to keep a close eye on. Steve: Are you satisfied with the level of ISV engagement with the accelerators? Are they still kind of too many of them on the sidelines kicking or poking it with a stick or have we got enough of them actually coming in now that you're happy with that velocity? Or are you feeling like there's a bunch more that need to get in there? Toby: I think, first of all, we've evolved a bit from that original industry accelerator approach to now just real industry IP that we're building first party in these verticals that I mentioned. Obviously there's great partners out there that can work with us with those solutions to, like I said, have their IP built on that broader Microsoft Cloud. Industry clouds are just a great example of a Microsoft Cloud solution, frankly. And so to your question of, do we have enough partners there? You want to obviously get it right when you launch an offering like that with the right, frankly, small number of partners to complete the solution and have it be good and relevant and useful for customers, but the more the merrier around that investment. Toby: And so it's early days, Steve, we only have one industry cloud in market GA'd at the moment, but as I said, there's a lot more coming. So we want to make sure we're building the ecosystem around it pretty aggressively. Steve: Yeah. I mean, we've got partners of all sizes, so we got some big healthcare ISV's I'm sure engaged in some of the heavy lifting, but healthcare is an awfully big market, awfully big field, and there is spot, point solutions kind of across the healthcare organization that need to be filled by probably a smaller ISV's. So it seems like there's stuff across that whole thing. Toby: Yeah. Totally. There's plenty of opportunity and plenty of space around that. And even from a geographic perspective, I mean, different parts of the world have different regulatory requirements and are different, and so there's yeah, to your point, and that's what I was trying to articulate earlier. I think there's still just a massive opportunity for partners to work with us around those new offerings. Steve: Well, I know you've got to get to your thing. You've told me twice in the call, I appreciate you pulling the car over to chat with me to catch up. I just wanted to get some of this stuff out to the listeners about some of these changes that just occurred. Steve: And I'm definitely going to go through, like you said, and study it a little more closely and I'll reach out to you directly with some feedback and some thoughts and see if we keep this thing moving. Toby: Awesome. Well, Hey, I'm so glad you caught me, Steve. It's always a pleasure to catch up and have a chat, and yeah, please do go through it in some detail. Again, your feedback is important. Whole ecosystems feedback is super important to me, so I appreciate it. And yeah, it was great to catch up. Steve: All right man, talk to you soon. Toby: All right. Take care, Steve.…
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Steve reads his Blog
1 Steve has a Chat with Ryan Cunningham 1:02:48
1:02:48 Play Later Play Later Lists Like Liked1:02:48
Play Later Play Later Lists Like LikedSo I noticed Ryan Cunningham , Product Lead for the Power Apps side of the Power Platform for Microsoft, suddenly come available in Teams. So of course, I ambushed him, and we had a great conversation about Power Apps and the whole Microsoft Business Applications group. Enjoy! Transcript below: Ryan Cunningham: Hello. This is Ryan. Steve Mordue: Hey, Ryan. Steve Mordue. How's it going? Ryan Cunningham: Oh, Steve Mordue. How you doing? Does this mean I'm in trouble? Steve Mordue: No, you are not in trouble, but you are about to be a guest on my Steve has a Chat podcast if you have time and are up for it. Ryan Cunningham: You mean like right now? Steve Mordue: Like right now. Already recording. Ryan Cunningham: Hey, okay. Let me check my calendar. There's nothing I'd rather do right now than being an impromptu guest on a Steve show. Steve Mordue: Well, we'll try and make sure you don't regret that decision. Ryan Cunningham: I regret a lot of decisions, Steve. But it wouldn't be the first. Steve Mordue: So let me ask you first, how long have you been with Microsoft? Ryan Cunningham: I just crossed five years. Steve Mordue: Five years. Ryan Cunningham: Just this past fall. Steve Mordue: I used to be a Salesforce consultant. We were Salesforce consultants for about 10 years and we moved over to Microsoft when they first moved CRM online back in 2011. So about 10 years ago. Ryan Cunningham: Sure, yeah. Steve Mordue: And I remember there being a few bumps making that transition going from on-premise to online, but then it kind of leveled out into what I kind of called the lazy river ride. It was predictable, it didn't move very quickly. There was no urgency and then James took over and he brought in all you young guys. It's been like a rocket roller coaster ride ever since. You ever got one of those really big roller coaster rides where you start praying for it to end, but you know it's not going to. It's just going to keep looping around and you can't get off. I almost feel like for a lot of us partners that have been around at least since it was lazy river, man, my head is rocking from all of the stuff you guys are doing. Ryan Cunningham: We don't do lazy rivers very well, Steve. Steve Mordue: Not anymore. Ryan Cunningham: Not anymore. Steve Mordue: Not anymore. Ryan Cunningham: At least class three rapids around here. Steve Mordue: How is it like on the inside for that kind of pace and ideation and everything that's going on internally? Ryan Cunningham: It's a great question. It certainly has not been constant here either. And again my experience in this community is not as long as yours. I joined at about five years ago and specifically joined the Power Apps team long before Power Apps was really a thing. I joined the team when Project Siena was for those that are familiar with that term, the sort of precursor to Power Apps was kind of in an early beta phase and there were grand ambitions of expanding out who could build software, but not a lot of... How do we say it coming out? Not a ton of product truth yet behind that. Steve Mordue: So I was in the audience, I think for one of your very first presentations before a big group of this product. You looked a little deer in the headlights at the time. Ryan Cunningham: I still feel that way sometimes. But if you take that over the course of the last five years where that idea has solidified, that product has gotten more mature. Certainly there's still more work to do, but we've gone from literally zero humans using at least standalone Power Apps to millions around the world and really also in the same breath gone from very long tail, very simple use cases to this grand merger with the Dynamics platform and customers building and trusting frankly much more sophisticated workloads to the platform. Ryan Cunningham: The world has changed a lot for us internally in how we approach this problem as you go through that product maturity life cycle. In the early stage, it's really about can we make anyone successful here? Now, it is much more about how do we scale and how do we focus on enterprise trust and developer productivity and really turn millions into hundreds of millions and that's... Steve Mordue: Oh, we got a little stall there. Ryan Cunningham: Right. Did I lose you for a second? Steve Mordue: Just for a second. I kind of sometimes think of Microsoft kind of like the Japanese manufacturing economy where they saw ideas that we would come up with and then they would put all their resources to make it better, faster, cheaper whereas a lot of the things we're doing in the power platform are not things that weren't being done before by others, it's just that someone on the team somewhere recognize hey, there's this movement going on out here with some of these smaller players and I think it's got some legs, so let's let's drop all of the arsenal that we have available as Microsoft onto this idea because clearly, we weren't the first low code platform right, but suddenly we're bringing everything Microsoft has to bear on this idea and to see it blow up like that. Steve Mordue: You can say that for almost everything that we've got going on, the bots, the flow, all of these sorts of things. We weren't the first, but then we came in and just put all this horsepower into an idea. Ryan Cunningham: Yeah. And it so much is about execution and executing at the right time and doing it for the right people. I think part of the reason why we internally work quickly and don't want to be on the lazy river is also because I think we tried to approach it with this fundamental... This is going to sound weird, but distrust of our own instincts to say, "Look, we have a thesis that people are going to want to build software faster. We have a thesis that they're going to want to do that beyond just forms over data." That's going to take many different forms, but in the nitty-gritty details of who's actually going to find the most value in individual features and individual assembly of those features, there's a lot of margin for error. Ryan Cunningham: And the sooner you get real software into the hands of real humans and they can use it and react to it and give you feedback actively about it, but also just give you feedback through their usage or non-usage of it, then the sooner you have real data to adjust and change and do the next thing. Steve Mordue: So it's not really like build it and they will come, it's more like build something and let's see who comes. Ryan Cunningham: Exactly. Steve Mordue: And then build some more. Ryan Cunningham: Exactly. Develop a relationship with those people who have come and then make sure that you're building it in a way that they're going to get really excited about it and then extend to others. So we really prioritize when we have enough of a hypothesis to head in a direction get there as soon as possible in the world and then work really closely and quickly once you've landed there to make it great and learn, and be willing to be wrong and be willing to change. Steve Mordue: Don't worry. I pointed out when you [crosstalk 00:07:43]. It's a lot of moving parts. I know you came in through the Power Apps door but have since kind of got your fingers into the whole pieces of platform it feels like. There's a lot of moving parts going on. Whenever you have that many moving parts, there's going to be bumps and issues along the way. So I can imagine that's just a continuous thing that somebody's building something over here. Somebody over here. Maybe they didn't coordinate as well as they should have and it gets discovered later and then I imagine these little fire drills going on internally [inaudible 00:08:20]. Steve Mordue: Left hand wasn't talking to the right hand enough. Let's get that stuff going on. Is that part of your role is to referee those sorts of things or identify them? Ryan Cunningham: I guess you could say that. And that's also part of growing a product and a team across a really wide surface area. How do we put in place the right listening mechanisms to customers, to data and reviews internally so that we can catch those things sooner and react to them more quickly. Because in many ways the ambition here is to span a really wide area of software and do it with a platform that has value and relevance to a number of different people in that spectrum, which is fundamentally really hard. Ryan Cunningham: It's one thing to build a focused experience for one very focused narrow niche of people, it's another... That alone is hard. It's another to build a set of tools that a lot of different people can use. But I think that was actually part of our... If you rewind several years ago and look at what we did between the Power Apps software project which started independently and the Dynamics platform and bringing them together, we really realized at the limit these things converge. At the limit, making it easier for non-traditional software people, citizen developers, amateurs, makers, whatever you want to call them and making it faster for professionals to build apps, those two ends have to meet each other at some point for this to really scale. So let's rip that band-aid off. Steve Mordue: How close do you think we are? How close do you think we are to getting to that ideal point? I mean, I think there's still... Even when I look at the citizen developer stories, a citizen can go so far and obviously we'd like them to go as far as they're able to go, to comfortably go and pro dev takes over. I have to assume there's a continuous motion inside to keep trying to move that line. Let's simplify some of these formulas that may be required that are just whatever those stopping blocks where you see a citizen is able to get this far, it hits a wall. Can we get them to the next wall? How much is going on in that process? Ryan Cunningham: It's a great question and it is really one of the central things that keeps driving a lot of what we do. I mean, we also look at a professional's experience through that journey, right? You look at not enlightened professionals such as yourselves, but all of the other software people out in the world who are very skeptical of platforms and who have an instinct to start from scratch and write everything themselves and go through some- Steve Mordue: Some of that could be financially motivated also. Ryan Cunningham: Oh, sure. Steve Mordue: Yeah. Ryan Cunningham: Right? But I think realizing that two trends are really converging here. To your point earlier, low code is not new, but we've had low code in two very different camps. This is the company that shipped Excel 35 years ago, 36 years ago. We certainly know low code for true amateurs and there's always been this world of people without a software development background working around the boundaries of the software they're given with tools to solve problems and that goes straight to- Steve Mordue: To Access wizards. Ryan Cunningham: Absolutely. Excel macros, VBA, Access, InfoPath and a number of other products outside of Microsoft. That's an enduring tradition. Then on the other side, what we've been doing is professional software people for the last 40 years is just adding layers of abstraction and tooling and not repeating ourselves and borrowing from other people to more efficiently assemble solutions as well. You can look at a platform like what XRM was unofficially and Dataverse and Power Apps on top of it now is just a natural extension of making professionals more efficient by not doing everything from scratch. Ryan Cunningham: Now, that's where those two trends converge and you're absolutely right to answer your question. We focus on okay, we made a number of people successful at that. There's a plenty of existence proof in our community and in our growth numbers and in our customer stories of people coming at the product from both of those directions and getting really successful and having a lot to show for it. Now of course behind the scenes, we're still, I would say very hungry. We're still at a couple orders of magnitude less than the addressable market of software consuming humans of what we could be serving even for all the astronomical growth we've seen in the platform over the last couple years. Ryan Cunningham: I mean, so it is absolutely about how do we take people coming in the front door. I'm a Teams user. I have some Excel skills. I happen to stumble on this Power Apps thing. How far do I get on my first try? What brings me back? How do I go from a user who expresses intent to a user who has a moment of success, to a user who then has an app that's used in production. And even from that point to somebody who keeps coming back to keep putting apps in production. Ryan Cunningham: Then similarly as a professional, how do I expand my tool set from Azure and Visual Studio and how do I have good experiences in my first try with a platform. How do I get to a point where I put something out there that humans are using in the world and I feel good about it. We really closely look at retention. We look at funnels through those early experiences. We look at satisfaction. All those annoying prompts of how likely are you to recommend Power Apps to a friend or colleague. Those are really valuable data points for us in addition to just the general growth rates overall because of indicators of the likelihood to be successful and grow in the future. Steve Mordue: I know we definitely have had success with enterprise organizations in particular where IT has embraced this and shepherded the process and built in their own systems like at the whole chevron way that they go about making power apps developers out of their employees and they've got a very specific process. I guess the other side of the equation is a smaller company that doesn't have those kind of resources. It's just Bob who's always been handy with spreadsheets. Suddenly he's trying to figure his way around. It seems like that's the one where we can't give that guy too much help. Steve Mordue: In enterprise they're going to have their system. Maybe have classes internally. They send their people to and stuff like that. It's a smaller organizations where he's left to the documents he can find and what he can understand. I think one of the things that Microsoft has always been a little bit of a challenge with Microsoft and documentation in particular is that they assume a certain level of understanding, in particular Microsoft and there's lots of folks that are coming to the platform that have zero understanding of Microsoft or history or know anything. Even acronyms or none of it. Ryan Cunningham: Right. Steve Mordue: It's almost like you can't make the documentation too dumbed down to get to that success. Well, how big is the team up to? Now, the last number I heard, and this has been a while ago, it was like 7,000. It was a pretty, pretty good sized team for the bag. How big is it now? Ryan Cunningham: That's a good question. I'm not trying to dodge you. I suppose I could look it up. I don't know for sure what James is... That whole business applications group org size is, but that's actually probably a decent estimate now that's not too inaccurate. Now, that's spread across a really wide surface area. All of the first party Dynamics apps have dedicated teams working on them. There are a number of other orgs within that organization focused on things like advancing AI and whatnot and then there's the core platform team, the Charles Lamanna team which I'm a part of which we structure into a core team focused on the backend, on Dataverse. A core team focused on each of the front-end products, so Power Apps, that's my team, Power Automate, Power Virtual agents. Then we also have a dedicated group in the platform org around admin and pro developers, and those experiences. Steve Mordue: I think when he came in, there was closer to a thousand on the team. So I mean the team has exponentially grown because you can't keep a lazy river going. Ryan Cunningham: Nope. Steve Mordue: You got to have speed when you got that many people on the payroll all working on something. So I also recall a time and I know it's still there, where there was a maniacal focus by the business applications group on the competitors particularly Salesforce at the time. I know that Salesforce is still in the radar. It does feel like we've kind of moved from really being focused on one primary competitor as we've launched all of these different applications into other competitive spaces where now you guys have hundreds of competitors that are all out there. How much do you guys focus on what the competition is doing internally and how you guys gauge what directions to go? Ryan Cunningham: It's really important to be aware of what people are doing in the marketplace. And we do spend a lot of time making sure that we have an intimate and hands-on not just academic understanding of what a lot of different software companies are producing out there. Steve Mordue: So you guys have licenses for everything. Ryan Cunningham: Well, where we can and it gets complicated because Microsoft also partners with many companies. Some companies we have agreements with about who will or won't use what software and we've got a lot of great lawyers to help us navigate that whole [inaudible 00:18:23]. I think the point is look, we're adding software to a world that already has a lot of software in it. It's important to look left and right and be aware of what else is out there because none of this stuff gets consumed in a vacuum by customers. You go to any moderately large customer organization, there's already a CRM system or seven in place. There's already an ERP system or eight in place and there's already a bunch of individual systems around that for point things and that's just the world we live in. Steve Mordue: And if they're exploring something, they're seldom exploring one thing. Ryan Cunningham: Exactly, right? And often if they're exploring especially a platform. There's a lot of existing things and a lot of the conversations become about how does this work in an existing ecosystem and how does it work? How can it potentially consolidate some of those things? We had Ecolab at a recent digital event talking about some of their Power Apps and Dynamics implementations. The average field employee at Ecolab had something like 27 different individual tools that they had to use to get their job done and it was a mix of... I mean, they had dynamics and they had Salesforce, and they had an ERP system, and they had a whole bunch of individual custom homegrown things and this experience was just really terrible for somebody out there on a tablet or a phone trying to inspect your water filter at your company. Ryan Cunningham: Starting to bring in Power Apps as a front door to some of those other systems without replacing them and just even making the wayfinding better is key. So look, it's important for us to be aware of what the world is doing. I would say it's never as simple as pure competitor or not in that picture because look, if you're a company like Microsoft, a lot of the names you rattled off or alluded to are also Azure customers and they're partners with them in other places. We're fundamentally a platform company I think is what it comes down to. Ryan Cunningham: The world is better when people can choose what they want to choose and are able to interoperate with those things at scale. Now obviously, there's incentive for us to have them using our stuff in that mix which is why we care a lot about it, but there's really not... Especially if you look at the body of what we offer even just in the platform, there isn't a clean head-to-head competitor right now for all of it. There are certainly competitors for each piece and I think being aware that those customers have choices and that we want them to genuinely choose the best and we want to be the best, that means we have to be aware of what best is and what customers define as best is just as important as what the guy down the street is offering. I think that the business applications group has the advantage of the enormous coattails of Office 365, now Microsoft 365. Steve Mordue: Sure. I don't know how many calls I get from a brand new customer who the primary reason they're looking at this platform is because they're already using Microsoft 365. And this idea that we want everything to work together and talk together. I think those coattails are an example of coattails that some of the other companies just don't have. You look at Salesforce for example. They don't have this productivity suite with millions and millions of users. So their story is going to be... We can integrate story and I just see more and more... I think we have to give such a credit for this because for many years Microsoft had a mixed reputation with IT. Steve Mordue: There are lots of people that hated them and all sorts of different things and such. It kind of seemed to have changed the attitude of the company to where IT who used to be like we're using on-premise exchange that's the only Microsoft thing we're going to touch. Now, they've brought in Microsoft 365. Now from an IT standpoint, it's you know what, I don't want to make my life any more difficult than it needs to be. What's the most logical choice for business applications when we're already stood up on all of this stuff and it's an enormous advantage and a huge coattail for the whole business applications group to ride in on. Ryan Cunningham: Yeah. I mean, this is why we focus so much on the platform working well in Teams for example. We've put a lot of effort into that this past year. I mean, part of that is the world turned upside down and changed and everybody started working in Teams. The other part of that is it's a huge advantage for a customer to be able to program and customize the collaboration environment whatever that is. Again, there's a long history of that within Office with SharePoint and InfoPath and stuff like that, but being able to look at that in a modern world and say, "I already have every employee working every day inside the team's environment. If I can start to put line of business applications in that environment, it's much easier for those employees to discover and it's much easier for them to then work around and collaborate around when those experiences require some form of collaboration." Ryan Cunningham: There are major Microsoft customers, Fortune 500 customers with tens and hundreds of thousands of users in their tenant that have more than half of those users using a Power App and Teams every month. You see IT departments using it. Those are not necessarily bottom-up Citizen Developer apps. You see IT departments really seeing that as a way to sort of re-imagine maybe what we might have called an intranet site 10 years ago sort of imagine an employee-facing app in the place where employees are already working. Steve Mordue: Sometimes, I actually feel a little guilty that one of our biggest growth years was a result of a virus and certainly the same could be said of Teams. I mean Teams was doing fine, but a virus really catapulted Teams to the position that it is. You feel a little guilty, but then again it is what it is and somebody has to feel that that need and it does create some massive opportunity. Ryan Cunningham: For me, especially rewinding to March and April, and May, I mean this was really a pressure test of our whole promise. The whole shtick and spiel of saying you can develop apps faster, you can do it quickly, you don't have to go through all the time and expense of software development, you can put it where people want to use it. Got a lot less nice to have in March of 2020 went from a lot of people from, "Oh, that sounds cool. I'll check that out someday." Steve Mordue: Someday. Ryan Cunningham: This is interesting to this is the only game in town. There were moments where I don't... I hear what you're saying. It is difficult to go feel like you're thumping your chest about business success in a year where a lot of people have had a really hard time and I really want to be sensitive to that. At the same time, the platform has really directly and indirectly helped a lot of people with those struggles. A whole number of both through the healthcare response to COVID, solutions that were implemented almost literally overnight in some cases for major state governments around the US and national governments abroad to first roll out large-scale testing programs on portals with CDS or Dataverse behind it and then roll out economic assistance programs on the same platform. Ryan Cunningham: Now rolling out return to work solutions on the same platform. Those are things where the traditional model of start up a waterfall development process, go write a giant requirements document, triple bit it, go through... You don't have the luxury of the Gantt chart in this world and you have to be able to move fast. And those are places where that is the platform we've been building for is that environment where we got to move fast. We have to do it non-traditionally and we have to do it with a lot less effort. Ryan Cunningham: This last year has really forced us to hone in on that value prop and prove that it's real, and frankly adjust a lot to make it more real for people who are trying to get that value. So I would say we have learned a lot in the course of this pandemic. A lot of people have. But we've also been able to do some good for the world in the same breath. Steve Mordue: It definitely was interesting timing because if you guys probably had to pick a time for a super crunch test of our platform maybe you don't like to see it in another year out or something. Ryan Cunningham: Yeah, sure. Steve Mordue: You can't cage these things, but it kind of hit when you guys still had some wiring to finish and I would imagine that the pressure on the team... It's one thing to we got to be out to market quickly because of competition. It's another thing because something like this has come. It has to bring a huge amount of pressure the team. We need to take Teams to the next level. We need to take build your own apps the next level and suddenly we've got an entire workforce that is now working from home that never planned to be working from home that is completely ill-equipped for that entire motion and these people need this stuff fast. Ryan Cunningham: Not to mention an entire generation of students who are now learning remotely, many of them in every age group from my first grader up to colleges and in universities. It's affected everybody. But you're right. I mean, the platform has been stretched at every level and it's not just the power platform. You're right. It's also very much Teams. I saw a really interesting internal presentation from an engineering leader in the Teams org comparing, "Look, here's what our load and traffic pattern looked like in January of 2021 and then to scale superimposing that on what it looked like in March." Not to say that, "Hey, look at all this great growth," it was really to say, "Look at what it took to go scale a planet scale service that dramatically that quickly." That was not a pleasant experience for the engineers having to work on that. That was [crosstalk 00:28:54]- Steve Mordue: A lot of late nights. Ryan Cunningham: ... 24/7 as any other response. No software is perfect. We like to gripe about everything and I share my set of barbs with stuff, but man, I have a ton of respect for the Teams engineering group and how well they have handled that just massive overnight change. Steve Mordue: So as we're recording this, vaccines for the virus are rolling out and I assume at some point in the coming months, it'll be behind us. In the meantime, it was around long enough to push lots of people to work from home longer than maybe their company owners thought would have to happen, but now they've gotten used to that. They've made accommodation. They've made it work. What do you think is going to happen when this particular crisis has passed and there's the ability to go back to normal? What do you think is going to happen with all these folks? Are we going to see a mass return to offices? Are we going to see people say, "This is working"? What are you guys thinking? Ryan Cunningham: I mean, it's a good question. I don't know that I can speak for all of Microsoft on this one, but I think at least in our own team- Steve Mordue: What do you think? Ryan Cunningham: I mean look, our team is already very globally distributed. We have the majority of our engineers and core products, PMs working in the Pacific time zone, but we have a significant group in Paris. We have a significant group in Bangalore. We have individual pockets. We have people in Fargo, North Dakota. We have a team in- Steve Mordue: Israel? Ryan Cunningham: We certainly have team in Israel. We have teams in parts of Europe. We have a team in Toronto. If nothing else, I think the core of [inaudible 00:30:49] sound based team has developed a lot more empathy for the experience of the very significant portion of our group that works around the world. I'm very experienced joining Teams. And I really hope that that continues if nothing else even if we all end up back in offices at a more regular level. Ryan Cunningham: We've learned at digital events and conferences and stuff. Certainly, it is not the same as being in the room with people catching up and networking, finding those discovery and unplanned moments with humans. And I do believe that we will go back to getting in rooms together both as employees, but also as colleagues. I really hope that we get to do that again soon. However, some of the digital events that we've pulled off as unelegant as some of them have come together also very rapidly having to figure out how to completely reimagine conferences like Ignite virtually in just a few months, those themselves were gargantuan tactics. In some cases there were orders of magnitude more participation in those events than when you had to get on a plane and fly to Orlando to get the benefit really. So there's- Steve Mordue: If I'm Microsoft, I don't know how eager I am to go back to in-person events given the success of like you say, I mean, so many more people able to attend. Microsoft's goal in having an event isn't for us all to hang out and have beers, it's to disseminate product information to his broader audience as possible and as deep a format as possible. Sitting in a session room, watching some guy present a slide deck, maybe it's a little more interactive, but not enough more interactive to justify the 30 people behind me versus 3,000 people that could be behind me in a video meeting. Steve Mordue: So from Microsoft's standpoint, you would think that, "Hey, great news. We don't have to go back to doing live events," which are, I think, they got to be a huge expense, a huge logistical challenge, all that sort of stuff. So the only reason to go back- Ryan Cunningham: I mean, I imagine- Steve Mordue: ... would be camaraderie or something. Ryan Cunningham: Like all things moderation. I'm sure we will... I hope we will reconvene at least some live events and I'm sure we will. I think we've learned that there's probably a bias before this year, this past year that the digital portion of a live event would be much less valuable. I mean, even already, I don't want to overplay that hand. Even already, we would frequently get more total usage over a lifespan of content consumed digitally when it was produced at the live event than at the live event itself. Ryan Cunningham: You could take a keynote at Ignite. There's 3,000, 10,000 people in the room, whatever, but then you go take the three months following the streaming of that online would accumulate far more visitors and end users than originally. That was already known. But being able to extend that from the keynote stage out to every session and being able to figure out how to produce that type of an event in a very decentralized way is, I think we've learned a lot through that process. Ryan Cunningham: Back to your question about people going to offices and the team working in places, I think there's a lot of reasons why a lot of people really value that type of working whether... There's people on my team who live alone and are really, really craving social interaction with other humans that are ready to come back. But there's also people on my team and self included with young kids in the house and a lot to manage and really craving return to normalcy and in that type of life environment. Ryan Cunningham: So I think work from home, I think we've all learned that we can do it and some people have learned that it's even better for them, but I think there's a lot of people who will still value working in a physical location and I hope we'll return to a good chunk of that as well. Steve Mordue: Yeah. It does get kind of lonely for a lot of folks especially those social people that need to be around people, need the water cooler or need to go to lunch. Ryan Cunningham: Yep. Steve Mordue: That's the best part of what they're doing. Ryan Cunningham: Yeah. Steve Mordue: Let me ask you about... Maybe I'll get a little self-serving here now. Ryan Cunningham: Sure. Steve Mordue: You're familiar with our RapidStart CRM? Ryan Cunningham: Yep. Steve Mordue: And I'm just curious about what the team internally thinks about motions like the one we're doing and others are looking at where we've... And I know you'll be a little biased because you're more on the platform side as is Charles. Charles is less concerned about the first party group. They got their own problems to deal with, but we're basically making a business out of building simpler versions of what the first party Teams have built for an audience that isn't prepared for that level of complexity. Ryan Cunningham: Yeah. Steve Mordue: And we've built it to run on the $10 pass, and we recently made it free. I'm just curious what the talk in the halls is about ISVs like us that are basically building products that are attacking directly. I mean, I'm attacking directly the sales professional for sure and even enterprise for a lot of customers because you've given us enough in the platform that I can build quite a bit for a lot of customers before I'd have to really go to those first party. What's the talk in the halls about that kind of motions? Ryan Cunningham: Well, luckily we don't have any halls anymore, Steve. We're all working from home. Steve Mordue: That's true. Ryan Cunningham: Otherwise we're- Steve Mordue: In the video halls. Ryan Cunningham: [crosstalk 00:36:36] Steve Mordue in every elevator lobby. Look, I will say a couple things on that. I don't want to speak for Charles, but from a platform perspective and certainly from my perspective too. Yes, our day job is focused on building a platform. Our biggest customer of the first party apps running on that platform still by revenue at least. We have a lot of incentive as a Microsoft shareholder and as a member of the business applications group and seeing the first party apps be successful. In fact, a lot of our effort and our engineering effort goes into helping those first-party apps be successful and stay successful and get modern and get fast and get mobile in addition to or in some cases around building the core platform itself. Steve Mordue: James has said not that long ago that make no mistake, those are what pay the rent. Ryan Cunningham: Yeah, absolutely. Look, Power Apps is driving an incredible amount of growth from a both a usage and a revenue perspective. But yeah, I mean there's an established greater than a decade business in CRM at scale that customers are driving themselves trusting billions of dollars of business too and paying Microsoft a lot of money for that privilege, right? So we take that very seriously and we are directly incented to protect that business whatever that means. Ryan Cunningham: Now, that said to rewind earlier in the conversation, we're a platform company at heart right and it's not just that Steve Mordue can go out there and build a CRM system on the Dataverse and Power Apps platform. I mean, we have multiple Power Apps competitors building on the Azure platform. They're Azure, and that's great as a shareholder and as a software person. The best solution should win and that's never going to be a one-size-fits-all answer for every customer. To your point, there are some customers that are going to be best served by a certain piece of software and Microsoft as a builder of generic things is not going to get into every niche, it's not going to get into every vertical. Ryan Cunningham: We want an ecosystem of people to build on the platform and extend things and even build fully standalone things for those niches, because we won't get there ourselves and we know that there are more of them out there where expertise needs to go. For Microsoft to really have a Microsoft product offering at scale, it needs to have a really big business behind. It's a really big business behind it. There's plenty of opportunity in the market at other multiples that is very profitable for software vendors and very advantageous for customers that are businesses that Microsoft will not directly enter. Ryan Cunningham: So I think in those worlds if the platform doesn't work for that, then what's the point of having a platform. It needs to work for that and we need to make RapidStart successful just like we need to make the first party Dynamics app successful. I believe those two things are not at odds with each other and they should live in a co-existing world. Ryan Cunningham: From a customer perspective even as a platform person, a lot of people will come in and say, "Should I use this off-the-shelf piece of software or should I build it myself in Power Apps?" My first answer to them is always if the off-the-shelf thing does what you needed to do or even does 80% of what you needed to do, it's usually worth buying. And even if the price tag feels more expensive, because what you're buying there is a team of people behind that app who not only put all the effort into making it, but are going to keep putting effort into making it better. Ryan Cunningham: And whether that's Steve's team or whether that's Muhammad Alam's team that is almost less relevant. The concept is I'm going to buy a piece of software that people have already figured out a lot of the hard parts for this use case and they're going to keep making it better. Now the ability to extend it is really important in business applications because selling shoes is very different than selling wind turbines even if it all involves selling stuff. [crosstalk 00:40:55] Steve Mordue: It's one of the reasons we ended up going free. When I first came up with that idea for RapidStart, we launched it in 2015 and it sat on top of CRM online the single SKU at the time to just really make the whole thing simpler because there was that need for something to be simpler. I had this dream that I was just going to sell that. People would buy it, pay me every month and leave me the hell alone. That was what I had imagined. But everybody, everybody wants to tweak and fiddle and make it unique. We actually look back last year at our revenue with 10 times more revenue on the services of helping customers customize our app that we did on the recurring revenue. Steve Mordue: That's the reason we decided, "Well, let's just make the app free and lean into the services as much," because I really didn't want to do that. I didn't want to do that business at all. Now, I'm being you know pulled in or the godfather won't let me out of the services business. But you're right, everybody needs something unique. So we really recast them as accelerators as opposed to here's something you just buy and use. But it's the same even with the first party apps. Nobody installs a first party app and just uses it. Steve Mordue: They've all got to be molded to fit the business, and I think that that's the nice thing about the platform whether it's on first party or just on Power Apps is you've got all the tools to... And that's actually one of the challenges we run into, I'm sure you guys do too where they look at some app and they say, "Oh, that's not exactly what I need," and then they move on, without realizing that, you know what, that can be exactly what you need and frankly, with the tools available that we have today, not that expensive, not anything like it used to be. Ryan Cunningham: Supposed than what I need and I can make it to work. Steve Mordue: Yeah, and a fraction of what it used to cost to do those kind of services. Ryan Cunningham: Part of making this stuff easier to adopt is about having apps that are much... At least much closer to what a customer needs out of the box. They don't have to do a bunch of customization upfront. I think something that we have been on the journey from, if you go rewind 10 years in CRM to now is make it less of a giant monolith make individual modules much more ready to consume. We've done a lot of work around that. But even within Power Apps, a lot of people get started by grabbing a template and implementing it and starting to use it fairly stock and then realizing, "Hey, I want to put my logo on it and then I want to change this form and then I want to change the field. And then I want a thing to kick off." Ryan Cunningham: Making the customization incremental as opposed to putting a really large tax and price tag before it's useful is one of the tactics we pursue to make it easier to get more people started. But that said, there will always be the need to tailor and customize software in a business application space. I think one of the trends we are seeing is this blurring of lines between... We like to pretend classically that there are ISVs who produce software and put it in the world and then never touch it. Ryan Cunningham: Then there are system integrators who do the dirty work of services to make it work. Those lines get really blurry in the modern world where from a classic services provider standpoint when I'm building and customizing on a platform, it's actually much easier to then start to templatize and repeat my solutions so I'm not just doing labor every single time. Ryan Cunningham: And to your point from a software maker perspective for customers who want to constantly customize it, it gets more viable to go the other direction depending on what your business model is. We see a lot of people living in that world. We even see customers themselves, energy companies, healthcare companies building stuff, financial services companies building stuff for themselves on the platform and starting to commercialize it to other people in their industry because it's on a platform that's transferable and that's something that classically you didn't see with line of business software. Ryan Cunningham: It was built in a vacuum custom and very tailored for one customer and then it sort of lived in that silo for a long time. But the ability to make those assets transferable is a huge advantage in this world. Steve Mordue: Back when they really first started pushing the Citizen Developer motion, I think I wrote a post about the end of SI business. This is it. We're all dead now. They won't need us anymore. The sky is falling, Chicken Little. But now as we've seen this thing roll out, because it is less expensive to get deployed, there are people building apps and using apps that would never have considered it before. Steve Mordue: So while I would say it's probably true that our average customer SI project has lost a zero in value, there's 10 times as many of them. So it's evened itself out. We've got many more customers available now than when the only way you could become a customer was if you had really deep pockets and a lot of patience. So we just opened up the number of potential customers by 10 times even though the deployment of each has gone down some. I'm not disappointed. Ryan Cunningham: And I think that trend is holding. I mean, I think you see even some of the big services companies like the big four and stuff like that actually seeing some very similar trends where they're building real practices on power platform whereas a couple years ago, they didn't see it as something for their business model, maybe even a threat to their business model. Now, they're realizing, "Look, I can drive real revenue out of this just the size and dollar amount and number of projects is a different mix that it was before." Ryan Cunningham: In some cases, those tend towards strategic consulting engagements. It becomes, let me think about helping a... For a large global organization to wrap their head around how do I use Citizen Development in my company? How do I keep it secure? How do I monitor it? Where do I let a business unit roll their own thing versus where do I bring in a team of professionals to build and maintain a solution? Ryan Cunningham: Even just that decision-making process and the center of excellence and governance practices that go around it, that's a major engagement that a lot of customers need help with right now because they're not organized for that today or resourced for it today. And then you look at getting into each of those individual projects. Certainly today, even in a future where apps are 10 times as easy to build as they are today, if I'm going to go roll out a mission mission-critical solution for managing customer data and critical decisions, I need software-minded people to help me think about how to keep that compliant, about how to build it in a way that humans are going to want to use it. Ryan Cunningham: Just because we put a tool like Photoshop out there in the world, does not instantly make everybody a photographer and a digital artist. There's still that mindset and expertise that's going to be really necessary. So for a lot of a lot of services organizations right now, I think they're realizing that there is a lot of value both in the execution of individual apps and projects, but then also in helping customers adapt to this new world where a lot of people can build software and you have to make decisions about who builds what and how you maintain it. [crosstalk 00:48:15] Steve Mordue: I think definitely one of the areas that's been blown up completely is the old ROI story because you used to be looking at a significant investment to deploy something of time and money, and the return on that investment was quite some time. That was what was going to limit the growth of any business application platform out there was... And now, that's produced almost nothing. Steve Mordue: So literally, Bob can go build something that starts generating revenue or saving money in an afternoon. The ROI, it's not even a question anymore about a half a day of Bob's time to go and streamline this process and save us five hours a day with his four-hour effort. Ryan Cunningham: True. Steve Mordue: And that didn't exist before. That just did not exist within the dynamics application before platform, before Power Apps, before Canvas apps. It's completely changed the entire game. Ryan Cunningham: Yeah. Steve Mordue: Before I let you go, what of the things as you look across the landscape right now and maybe the things that are coming up that have been discussed that people are aware of, what excites you the most? What do you think is... Two things. What are you the most excited about? And the other one is what do you think more customers would be excited about if they understood it better or realized that that's the most underutilized high value thing that people are just missing? Ryan Cunningham: Sure. Those are big questions. I think there's a lot that I get excited about. For people that know me, it's not hard to get excited. Steve Mordue: Yeah. You're excited about that lamp in the background, I know. Ryan Cunningham: Exactly. It's a great lamp. It's not. It's a crappy lamp from Ikea. Look, I think for me certainly there's a ton of work in our feature backlog that's really cool and really exciting and there's a lot of work particularly around bringing intelligence to the authoring experience that I'm pretty excited about. To the earlier conversation we're having about make it easier for people to be successful and maybe not have to deal with that formula bar, there's a lot of cool stuff that we're starting to apply. Ryan Cunningham: We've brought AI builder to end user apps, but actually bringing that to the maker experience of being just... And not in magical unicorn pixie dust ways, but just in really practical ways suggesting ways for people to do things, suggesting things to do next, making it possible to write logic in natural language as opposed to having to know all the ins and outs of the formula for example. There's some really cool stuff cooking there that I think will start to continue to open up orders of magnitude of humans who can be successful. Steve Mordue: Move that bar farther down the path. Ryan Cunningham: Absolutely, right? Classically, sometimes we think about those as tools just for true amateurs. But if you go look at even all the productivity that a product like visual studio has brought to professional developers, it's in stuff like Typeahead and linting and all that. It's really about bringing micro intelligence to those micro interactions that a person who's living in this tool for eight hours a day, all day long is going to need to be really productive. Ryan Cunningham: So we're really thinking about that both ways. So those things are exciting. I think if you zoom out a little bit though beyond the individual level of feature work, I would say, what's most exciting to me and what I hope is getting more exciting to more customers is less about any one individual feature or product and more about what's possible when you start to combine them at scale. Ryan Cunningham: I think that's where, if you look at organizations that have really gone all in on Citizen Development and low code for professionals as well and start to work together, you see this new way of working where you have professionals and amateurs and IT people and business people knowing each other and working side by side in a place where they traditionally were opposed to each other. Or at least just not aware of each other. And that's where you get not just one cool app with one cool feature, but literally thousands of applications inside of organizations that are just creating a crazy amount of value and you start to change you start to change the lives of people in those organizations. Ryan Cunningham: Both the people that are able to implement that stuff, but also you just make the jobs better for the people who get to use stuff that was built by their company and was built much faster. That's ultimately super exciting to me is to start to see this making a real change in the way that humans are working and doing it through a mix of apps and bots and automations, and Teams experiences. Ryan Cunningham: It's when those things sort of work together in concert that I think they get most exciting. So I'm thrilled to see that happening. I'm really excited about this end-to-end stack of what customers have done with Azure resources through power platform, in Teams and how that has created a meaningful dent and how a company works. I'm super excited about all the work we're doing to make that smoother to actually implement and manage and deploy, but I really hope customers see beyond the one use case, see beyond the one app or see beyond the one product and see what's possible when I start to change the economics of how software is rolled out in my company. And by economics, I mean not just- Steve Mordue: It is a discovery process. Ryan Cunningham: ... who participates. Right, yeah. Steve Mordue: It is a discovery process. They stumble upon something. They start using something and if they're successful with it, then they start discovering these other pieces around it that are available around it to extend on it. I don't think the technology itself right now that we have is a blocker to growth. I think the biggest challenge with growth right now probably relies more on the complexity of the licensing side. I mean, there's a lot of customers- Ryan Cunningham: I mean, I think there's good parts of it. Steve Mordue: ... that can't even get started because they don't understand what they even need or how to buy especially in the Power Apps store where they've got some seated Power Apps capabilities, they don't know what word seated even means or that they have it, and then they're seeing all these cool Power Apps things and they can't figure out how do I get from here to there? Why can't I do this and that? I think that probably is a bigger blocker to potential growth than the technology itself. Ryan Cunningham: Maybe. I would say certainly- Steve Mordue: Have you read the licensing guide? Ryan Cunningham: It's my favorite James Joyce story. Steve Mordue: I'll bet. Well, most customers haven't and wouldn't. Ryan Cunningham: Well, I guess what I would maybe zoom out from that, I would say... You're right. The technology itself can solve a lot of problems for a lot of different people and we have existence proof of that. Getting an organization at scale to discover it to see it in that light and then to have an organizational culture embrace it. Certainly licensing is a part of that, but it's also about who in IT is responsible for it? How do we govern it? Where do we roll it out? Who is footing the bill when I do understand how to pay for it? Ryan Cunningham: At the end of the day, licensing is actually very simple which I know is a controversial opinion. You get a measure of it in Office. For extending Office, you pay for Enterprise data sources. There's two ways to pay. You pay per app or you pay unlimited, full stop. That's the license. Now, we do not do ourselves many favors when we have classically rolled that out. And I absolutely take your point that we have made the communication of that complex. Ryan Cunningham: And for a lot of customers, this is not a commodity expectation. We're at a point right now where everybody needs an email account and a productivity suite and Word processing and every seller needs a CRM license and those things are not necessarily controversial, it just becomes about what's the best price from the best vendor. Because they're mature products in mature markets. Ryan Cunningham: Low code is at a very different state of market maturity. So for a lot of people it's about not just understanding how our pricing is structured, but understanding organizationally for them how do they conceptualize ROI? How does the market offer these products and how do I evaluate that potential expense against the value I'm going to get out of it? I think in addition to making things like the licensing guide easier to read for people who do not have PhDs, I think it's also really about helping the market get more mature and seeing... We really genuinely believe this will become an expectation of organizations. Ryan Cunningham: If you go fast forward another couple years, if I can't rapidly innovate internally and I am dependent on a team of professionals to start from scratch every single time that I that I need a problem solved, that's going to be a major competitive disadvantage for organizations. And on the flip side, being able to have every information worker be able to do at least basic tasks extending their software and solving their own problems is increasingly going to be an expectation. Ryan Cunningham: We're not there yet from a market maturity standpoint. Not everybody sees it that way, but we've certainly seen enough proof of organizations already evolving to that point that we know that that's coming. So I think being able to get to that place is a journey for a lot of companies. It's then really the next phase for us of bringing the world to where we know it can be. Steve Mordue: I mean, you just look at some of the things in the past like the first Obamacare website debacle with all the millions of dollars they spent to basically build a website and then look at what it would have taken for somebody to pop that up on portals today. I mean, there's no compare. I mean, we've actually lost projects in the past because the people thought we didn't understand the scope because we were like 10% of what the other companies... So we clearly misunderstood the scope and they just misunderstood the value of a platform and what that does to a development cost and time cycle and everything. Ryan Cunningham: There are government entities that rolled out COVID testing solutions on Power Platform in literally weeks to tens of millions of citizens and had that go off without any major hiccup. You're right. We get back to that pressure test. It's like getting that to go to scale and to help more people see it that way and be able to expect that from their software. That's really the next mountain to climb. Steve Mordue: I think the two challenges we've had around licensing are that Power Apps versus Power Apps. We've got these two products that really are our different products that share the same name and that puts some confusion in customers where they think they already have Power Apps. Ryan Cunningham: Have it right. Steve Mordue: They don't understand why they have to go buy Power Apps or they have Power Apps. And the other one is the passes, the per user or the per app passes. Those are assigned in a different way than all the other licenses they have been using internally for years. It's the only thing that's assigned that way. So it's a different process and they're looking at how do I do this? I've assigned licenses all the time. I don't understand how to do this. Steve Mordue: Those are two spots if you could personally take as a favor to me, go clean up the pathways [crosstalk 00:59:39] on those to make that as smooth as possible for people to understand, that would be that would be awesome. Ryan Cunningham: And that feedback is well heard across the market. I mean, we are at the pace that we were trying to do some work on the first problem to clarify really Power Apps for Office from our apps for stand-alone. And then separately the per app concept is a really powerful concept and actually a lot of organizations have embraced it. I don't know if I'm allowed to say this. there's more monthly active usage of apps on a per app license today and this has been true for many months than there were on either the older two licensed models, right? Steve Mordue: Sure. Ryan Cunningham: I mean it hunts for a lot of people when they can realize, "Oh, hey. This is a way for me to apply the value of the platform to a use case without having to go have this broader discussion about committing the entire organization to an unlimited number of apps." Steve Mordue: And just a difference of cost Ryan Cunningham: It's a different concept for people. Steve Mordue: And just a difference of cost. At $40, I can afford to have 10 people use this. Ryan Cunningham: Right. Steve Mordue: At $10, well I can afford to have 40 people use this. So suddenly, strictly related to cost, you're going to see that usage explode on those lower cost licenses because those are people now using an app that weren't going to be able to use it before. They weren't going to justify the expense for that level, that tier if you will. You start getting into 10 bucks, I mean that's pretty much anybody in the organization you could justify 10 bucks for. Now suddenly, everybody has an app. Ryan Cunningham: Yup. We've seen a number of customers already even though this has been in market only about a year. Start there and then very quickly realize, actually we want unlimited [inaudible 01:01:25] people through the transition is a phase as well. Steve Mordue: This is something that you take in account as a builder of apps also if you're wanting to try and build for that, you build your apps understanding the licensing structure and you design for it. So listen, Ryan, I appreciate you taking this time out of your, obviously not busy afternoon. Ryan Cunningham: [inaudible 01:01:50] Steve Mordue: A rare not busy afternoon for you, I'm sure. I'm feeling very lucky to have caught you when I did. Ryan Cunningham: Sure. Steve Mordue: Any closing thoughts? Ryan Cunningham: Hey, keep doing what you're doing, Steve both being a rock in the community and also pushing us on the platform to make it better. I think ultimately we see this as a thing we're doing together and I mean that really genuinely. We don't sit in an ivory tower. [inaudible 01:02:18] When we do, we make plenty of blunders, but I think this thing we are building is bigger than lines of code. It's a mindset and I think the more that the community embraces it, the faster we go. So I really appreciate you and everybody that is hopefully going to listen to this someday and participate. Steve Mordue: There'll be thousands listening. There usually are. So don't worry. Ryan Cunningham: Yeah, 100%. Thanks for the call, Steve. Steve Mordue: All right. Cool, man. Talk to you later. Ryan Cunningham: Be well, peace.…
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Today, Microsoft business Applications group is announcing a special offer for Power Apps Per App Passes. It felt pretty significant, so I thought I would write a short post on it. The Offer Starting today, you can buy Power Apps Per App Passes for $3 each. The catch? Minimum 200 users... but still.. that is a pretty big deal for mid-sized and above companies. For example, combined with our free RapidStartCRM, that gives you an enterprise grade CRM for 200 users for $600/month!!! In addition to this offer, the Power Apps Per User plan is $12, instead of $40, but that has a 5K user minimum, so really for enterprise only. Let's do some math Wah, I don't have 200 users! Well, $600 (the minimum) would also be equal to 60 users at the regular price. So any number of users over 60 starts saving money. For example 100 users ends up costing $6/user, 150 users ends up costing $4/user, etc. But, if you have less than 60 users, there is no advantage, so SMB is basically out of luck. Availability The Power App Per App pass promotion is available through Volume Licensing or CSP. The Power Apps Per User promotion is only available through Volume Licensing. Neither offer is available via Direct at this time. What happens when it ends? If purchased via CSP, the offer is good for one year, after that you should expect to go back to the $10 price, unless Microsoft decides to extend this (a possibility). Via Volume Licensing you can keep these prices for up to 5 years!!! This is just a short post, because I was excited about this. Contact your partner and ask them about it!…
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1 Microsoft marching masses to peak of Mt. Stupid 6:22
6:22 Play Later Play Later Lists Like Liked6:22
Play Later Play Later Lists Like LikedI recently became aware of an interesting concept in psychology called the Dunning-Kruger Effect, and Citizen Developers came to my mind. What the hell am I talking about now? Read on to find out. The Dunning-Kruger Effect Essentially the Dunning-Kruger effect is one's own perception of their reality. Often displayed as the following image: For those of you who are listening to this, instead of reading it, I will describe the image. On the vertical axis is confidence level, from low to high. On the horizontal axis is Competence level, from "Know Nothing" to "Guru". It seems that many people, who know nothing, can have high confidence of their knowledge in spite of that fact that they... well... know nothing. In the Dunning-Kruger model this places these people at the peak of "Mt. Stupid". I am very familiar with that particular peak have spent my early 20's there. Following the peak of Mt. Stupid, is the Valley of Despair, where one realizes that they actually know... well... nothing, and their confidence plummets. From there, they travel the "Slope of Enlightenment" back up, slowly, until they reach the "Plateau of Sustainability", or actual Guru level. This assumes they remain on the "Slope of Enlightenment" long enough. Citizen Developers Almost every other day, I am on the phone with Citizen Developers at various stages of this model. Like all of the low-code platforms, the Power Platform's primary goal is to "enable" Citizen Developers. Unfortunately, all of the Low-Code platforms, including the Power Platform, present themselves in such a way as to give a person who "Knows Nothing" very high "Confidence". Thus, marching them Pied Piper style to the peak of Mt. Stupid. I have spoken to Citizens with this high confidence, aka "Cocky", and after about 30 minutes of conversation. aka "Enlightenment", have unintentionally knocked them off the peak and into that valley. Well... not the really cocky ones. Riding the Slope I have been involved with Business Applications for over 20 years and still feel firmly on the "Slope of Enlightenment". Whenever a platform, in my case Microsoft, adds a slew of new capabilities, that "Plateau of Enlightenment" just moves farther out. The best that the most knowledgeable and experienced of us can hope for, is to remain on the Slope... indefinitely. When a "Citizen Developer" thinks they are as capable as one who has been on the Slope for 5-10 or 20 years, they are clearly straddling the peak of Mt. Stupid. While I am not easily impressed by your Power App, I am professional enough to not laugh out loud at your feeble effort, since I understand, sitting on the Peak, you are quite proud of your accomplishment. Circumventing the Peak In my experience, this idea will be harder for men than for women, because it requires reading directions. But if you want to bypass the Peak, start at the Valley. Since you would not have gone to the Peak in the first place, the Valley is not one of despair, but rather the beginning of your journey on the Slope. If you want to do this right, and many say they do, but actually don't, then you need to invest the time. Do not fall for the over-confidence building marketing messaging from any low-code platform. Why? 25% 25% is about the percentage of our practice's work that is allocated to fixing things built by Mt. Stupid flag planters. I am reminded of a buddy of mine when I was a teenager. He thought he was a great mechanic, but every time he rebuilt something, like an engine, there was this odd pile of parts leftover. When asked about them he would say something like, "I'm not sure what those are, but they are definitely not needed". As I recall, his vehicles were always on blocks, and I never saw him drive one. A Fork in the Road What many Citizens miss are the forks in the road. Some are obvious, and still the wrong one is taken, and many are not so obvious. Where this matters is down that road, when the clear realization that the wrong fork was taken becomes apparent. I'm not sure if any statistics exist, but I would assume the number of efforts that went the wrong way, and were then either abandoned in frustration, or taken all the way back to the fork, is quite high. The biggest thing that Mt. Stupid does not provide, is a clear view into the future. However, after a while on the Slope, the future becomes quite predictable. Back to the Slope The Slope of Enlightenment is vast, and as I said, even those of us with decades on it, are still climbing. So where does a Citizen even start? I can tell you where we start. First, before building anything, we create the data-model. Apps are pretty easy to change, but the data model will eventually expose any wrong forks taken, and these tend to be the most complex to reverse. Second is typically the UI, getting the data onto forms in a usable way... this is harder than it sounds if you take into account user friendliness vs. function. Lastly is automation, which seems to be the thing too many Citizens are way too eager to get to. If this post sounds like I am bitch-slapping Citizens.... I'm not. I am fully cognizant of the movement, and it is actually not even a new movement. We still spend time unwinding Access databases built by tech savvy, but not business savvy Citizens of those days. I'm just suggesting that scaling Mt. Stupid does not give the same satisfaction as scaling Mt. Everest.…
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1 The beatings will continue until morale improves 5:25
5:25 Play Later Play Later Lists Like Liked5:25
Play Later Play Later Lists Like LikedJames Phillips, the head of engineering for Dynamics 365 and the Power Platform, that we all either use, or make a living on, recently tweeted "The name changes will continue until morale improves". It was a joke people!!! Relax My inbox blew up with people asking me what "morale" issue James was referring to. Jimbo was paraphrasing an old quote that I used for the title of this post. In fact, Jimmy is not even responsible for naming as far as I know, that merry-go-round is operated by Alysa Taylor's team. I think JP was acknowledging the angst of name changes in a humorous way. So.... relax... morale is fine. But for some, there are legitimate concerns with certain motions other than naming. ISVs on Edge Despite James' public insistence that Microsoft wants to be a platform company, his product engineering teams are continuing to crawl up-the-stack. It was not that long ago, that the position expressed by Microsoft was, we will never go vertical, that is for our partners and ISVs. It feels to me like the recently launched " Microsoft Cloud for Healthcare " is pretty darn vertical. I also assume this is the first of more "Industry Clouds" to come. Microsoft's message to ISVs? "There's plenty of opportunity for ISVs here". I'm not convinced yet. Keeping up with the Jones' This is most likely a Microsoft reaction to similar motions by Salesforce. I do understand the competitive forces in the marketplace, and reacting to them is necessary. But one of the reasons I moved from a Salesforce Consultant to become a Microsoft Partner 10 years ago, was the "Partner First' ecosystem. "Partner First', or 'Partner Led" have never been part of SFDC's lexicon. At the moment, I am struggling to reconcile Satya's words with some of these motions. You will eat it, and you will like it Historically, Microsoft provided the platform, and some relatively generic applications, that were then extended by SIs and ISVs to meet the specific requirements of verticals, including healthcare. It has been the meat of a business application partner's business. It feels to me that these Industry Clouds scrape much of the meat off partners' plates, and onto Microsoft's. It feels like we are left with mostly vegetables... and I never liked vegetables. Get on, or get out of the way None of us can say that Microsoft has not been crystal clear in their guidance to Partners and ISVs in the last few years: Get Vertical! Seeing the huge vertical opportunity, maybe Microsoft just got tired of waiting for us all to come around. So "Partner Led" becomes "Partners Follow", I can't say that I blame them, I'm not a particularly patient person either. Looking at a vast unmet opportunity, and sitting on your hands waiting for partners to see and act on it, would probably drive me to eventually elbow past the stagnant herd also. Seeds were planted I hate to say "I told you so"... but I did. I saw this coming with the initial launch of the first "Industry Accelerators", free data models with "example apps". Again, not enough of us bought into the accelerators, so "Industry Clouds" built by Microsoft on top of them, was an obvious next step. "Example Apps" evolved into finished, supported and SKUed applications from Microsoft. Impact on ISVs and SIs? It's too early to tell what the impact will be from these motions. Clearly if you had built extensive healthcare IP, there will be an impact, you may even find yourself competing with Microsoft in some cases. If you were thinking about building IP for Healthcare, you may have to focus on the vegetables now. For SIs, what you may have charged historically to build out a healthcare solution, will likely be less for extending a pre-built "Industry Cloud" solution. Who wins! This motion will be a win for the customers of course, by potentially lowering development costs, and having more direct support from Microsoft for Microsoft-built stuff. But I really feel that Microsoft will be the biggest winner. I have written before that Partners are simultaneously Microsoft's biggest asset, and biggest liability. While opening every partner presentation with the obligatory "Thank You Partners!" slide, there have been distinct moves to reduce their dependency on partners from Microsoft's first stepping into the cloud. "Citizen Developers" for one obvious example. I'll conclude this post by saying that, no business model is immune from disruption, and that includes Partners.…
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1 Microsoft taking away Direct CSP from Small Partners 8:02
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Play Later Play Later Lists Like LikedWhen I moved from Salesforce to become a Microsoft partner about ten years ago, they were just launching the "Advisor" model for cloud license sales. The road got rocky after that. Life was Good The Advisor model was great. Microsoft handled everything, billing, support, collections, etc. All we had to do was bring customers and get paid a commission on the licenses that were bought. Cloud was exploding at that time a rate Microsoft did not seem prepared for. The Advisor model was putting too much of a strain on Microsoft, so CSP was born. CSP sought to put Partners or Distributors in the line of fire, in front of Microsoft. As a CSP, you were now responsible for billing, support and collections. CSP Bumps Microsoft launched CSP in basically two flavors, Direct or Indirect. The Indirect model was were partners would transact though a distributor. But distributors seemed to have been caught flat-footed at launch, and not a single one of them had even a plan to figure this out. Distributors were still reeling from the loss of hardware and CAL sales as the cloud loomed larger. The other flavor was Direct CSP, originally intended for large partners. The problem was that large partners were moving to cloud way too slowly. Desperate to get out from under the burden, and not having the patience to wait for Disti to get their shit together, Microsoft decided to lower the bar to entry for Direct CSP, and a bunch of small partners, including us, rushed in. Our Strategy The CSP has support responsibility, meaning in the Indirect model, the Distributor was responsible for support, something they were ill-equipped to provide. But, as a small partner we were not really equipped to provide significant support either. So we became both a Direct and an Indirect Partner. My thinking was, that if we had a customer who looked like they would need a lot of support, I would run them though Disti, otherwise we would take them Direct. It seemed like a good plan, but again, Disti was not prepared or capable of anything. Simple things like adding a license was a huge project. Our Shift At the urging of Microsoft, we got into some things we were not particularly good at. As a CRM partner, we suddenly found ourselves selling Office 365 and Azure, and we pushed all of that through Disti. It was a mess, where our CRM customers thought we were awesome, our non CRM customers, rightfully thought we were idiots. So I got out of that business by transferring it all to a Gold Office 365 partner. Now we were back where we should have stayed, a CRM-Only partner. As a CRM partner, working with CRM customers, we had little need for support, from either Disti or Microsoft, so we dropped the Indirect relationship and went all Direct. Things were good. Microsoft Knocks A couple of years ago, I got an email from Microsoft saying that they were adding a new wrinkle to Direct CSP. "Advanced Support" from Microsoft would now be a requirement, at a minimum cost of $15K/yr. I thought for a minute about getting out of the licensing game. This was an obvious move by Microsoft to get rid of partners exactly like us. That $15K was eerily close to our entire license margin! But licenses were still petty expensive, and I thought we would continue to grow that side, so I bit the bullet and paid it (a decision I regret). Worthless As a partner focused deeply on a single product, we really did not need any support from Microsoft. I think we may have opened one ticket, found the support to be no better than standard support, and never opened another ticket. Support was just a tax on our revenue... at least in our case. When the MS rep called about renewal, I said we were going to pass. He told me that we would basically be kicked out of the program. I pressed him on this, "What about our existing customers?", and he conceded that we would be able to maintain our existing customers. I decided that was good enough. I suspected that MS did not have any technical enforcement, and was correct, as we were still able to add new customers. The $10 Pass When Microsoft launched Power Apps at $40/month, and then the $10 Per App pass, we immediately started changing our customers licenses, where we could, to the lower cost licensing. Obviously this lowered our license margin revenue significantly, but it was the right thing to do for the customers. It also lowered our total license revenue to Microsoft. Microsoft Knocks Again I got an email from Microsoft the other day, that I am sure was sent to all small Direct CSPs. The next effort to get rid of small partners in the program. Microsoft has decided that the minimum revenue to remain in the program was now $300K/yr... oh and you had to pay the Support tax too. Otherwise you would be off-boarded. Off-boarded from a program they asked me to join. To be honest, since we are now focused on selling our solutions, that run on low cost licenses, there is not much of a license margin opportunity for us in CSP anyway. Option For those that don't meet the new requirements, Microsoft is suggesting we go to Indirect with a Distributor. I have no interest in that, Distis are idiots. What I would prefer, is to continue to manage my existing customers, and eventually move them to Microsoft Directly over time as their renewals come up. I have asked what the process is for that, and have not been given an answer. Pricelists Microsoft updates the Cloud Reseller Pricelist monthly. Often new SKUs are added, and some SKUs are removed. Once a SKU is removed, it can no longer be sold to new customers, but existing customers of that SKU can continue to add and remove licenses based on that now deprecated SKU. It is not at all clear to me that customers will be able to keep these SKUs in a transition to either Disti or Microsoft, which would now be a new tax on customers, if they are forced to move to the current pricelist in the transition. The Undesirables We all have them... undesirable customers. It would be nice to just flip a switch and get rid of them, but I made a commitment. In some cases I have agreements in place with terms that I regret, but again, I made a commitment. I can make up new rules for new customers, but I feel bound by the deals that were made with current ones. Maybe if I had as many customers as Microsoft has Partners, I too could be ruthlessly arbitrary... but... I can't. Basically this is just a "venting" post with no real conclusions, but I am sure there are other partners who are in a similar situation, so I thought I would share my opinions. Feel free to share yours below. Here are a couple of links of interest: https://docs.microsoft.com/en-us/partner-center/direct-partner-new-requirements https://docs.microsoft.com/en-us/partner-center/restricted-direct-bill-capabilities https://docs.microsoft.com/en-us/partner-center/transition-direct-to-indirect…
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Steve reads his Blog
In one of our private MVP channels, another MVP “joked” that Jukka Niiranen should consider reading his blog like I do, so I “joked” that I would do it for him, and then Jukka “joked” that he “ fully approved this innovative art performance “, and so.... all jokes aside… a Special Edition of Steve Reads his Posts, where I instead, Read one of Jukka’s posts. But before I do that I have known Jukka for several years now, and I consider him "the" top blogger when it comes to all things Power Platform. I also write a lot about the Power Platform, but I have a much different style than Jukka. If you could only read one blog to get the latest information on the Power Platform, I would easily recommend his blog over mine. But we both know you can read more than one blog, so you should follow both of us. It was not hard to pick a great post of Jukka's to read, I simply opened his most recent, since all of his posts are brilliant. I’m reading his own words, unedited, so where you hear “I”, it is actually Jukka. Please enjoy this special episode of “Steve reads Jukka’s Post”.…
In this past week, I had two potential customers who were deciding between our RapidStartCRM Power Apps or Zoho . For one of them, I had no choice but to recommend Zoho. I you want to know why, keep reading. Customer Number 1 I got a call from Bob, the owner of Little Bitty Inc., in Podunk, Nebraska. Bob was managing the finances for his 5-person business in his checkbook, and managing his sales with a Google spreadsheet. He said he had been considering Zoho, but then saw an ad for our RapidStartCRM talking about how it was "Simple-to-Use". I realized at that moment that "Simple-to-Use" is a relative term, and was pretty sure that our app was not "Simple" enough for Bob. Plus he wanted to move his checkbook onto something, and that is not what RapidStartCRM is. My mind flashed across an integrated RapidStartCRM/Business Central scenario for a brief second, and then I said, " Bob... if I were you... I would go with Zoho ". I'm all about RapidStartCRM, or even just Power Apps, being a path forward from spreadsheets, but for Bob... it was going to be too much of a leap. Zoho was going to be good enough for Bob. I actually like Zoho, and for a customer like Bob, I think it is the perfect solution. Zoho is not particularly powerful, nor extendable, but then... neither was Bob. Customer Number 2 I got a call from Rich, the IT Manager at Acme Solutions, a 30-person business in Atlanta. Rich had already moved his company to Microsoft 365, and was ready to tackle his sales team's challenges. They were currently using Excel Spreadsheets and SharePoint to manage their pipeline. Rich was also looking at Zoho, but just their CRM capabilities, Acme did not need the finance side. But since Rich had recently moved to Microsoft 365, he thought he would explore Microsoft's options. He did a trial of Dynamics 365 Sales Pro, and while he liked the power and extensibility, compared to Zoho, he concluded that it was simply too complex, and would need to be modified quite a bit to meet their specific requirements. He knew that Zoho could not be modified to meet his exact requirements, but it was cheaper and easier to use. So he had decided to start with Zoho, and see how far it would take them... it was better than spreadsheets. He got a call from a Microsoft rep because he had trialed Sales Pro, and after explaining his concerns, she suggested he check out RapidStartCRM, and so we ended up on the phone. Knowing he was considering Zoho, I assumed price was important, so I started by pointing out to Rich that RapidStartCRM was free, and ran on a $10 Power Apps Per App license. He informed me that was about half the cost of Zoho's lowest plan, which I opened a browser and confirmed, Zoho's base plan was $18/month. This actually backfired on me as Rich became suspicious that since RapidStartCRM was less, Zoho's CRM must have more. I asked about his requirements and it sounded like 80% of them were covered with RapidStartCRM, out of the box, the same 80% that Zoho also covered. Then we explored that 20% that Zoho could not get to, and even though the requirements were quite specific, none of them were complicated to extend to in RapidStartCRM, which again is a Power App. In fact, we extended the conversation of his requirements, talking about some platform capabilities he was not even aware of, and then he decided those were now critical! I really love the "discovery" aspect of these calls. Solution Fit I would love to say that RapidStartCRM is the ideal fit for any company, in any situation, but that's simply not the case. It was the perfect fit for our new customer Rich, but not a good fit for Zoho's new customer Bob. I think the key difference is looking out beyond today's need. While there are plenty of simple-to-use apps, including Zoho and RapidStartCRM, it is really about where you can eventually go with them. Microsoft likes the term "No Cliffs", meaning you will never hit a wall with the Power Platform and have to migrate elsewhere. I like that term also, and so do companies that are expecting to grow into bigger companies. The offer you can't refuse Two things happened that changed the landscape for us. The introduction of the $10 Power Apps Per App Pass (license), and our decision to make our apps free. Where I had been quite used to making the case for more capabilities at a higher cost than the competition, we are now offering more capabilities at a lower cost than the competition. It sure makes selling easy! :)…
I get that it is mostly partners and Microsoft employees that read my blog, I have not really targeted my content toward customers, which was probably a mistake, but that is a topic for another day. Today, I want to break down some significant changes we made to our ISV strategy and why. Every ISV is Different Our strategy is obviously not going to work for every ISV. For us, I think it makes sense, for others it could be non-sensical. In this post, I want to further expand on our recent strategy to make our RapidStartCRM Apps free, and how we plan to generate even more revenue than before as a result. I had a Dream When I first conceived of the idea of RapidStartCRM in 2015, there was nothing else like it in the market. "Dynamics CRM Online" was a complicated product to deploy and get adoption on... and still is. We built a solution that sat on top of it, mostly hiding the complexity. I had joked to James Phillips once, that every time he adds a new feature, we have to go back into our solution and hide it... he was not amused. But this was not my dream. My dream, was that users would just install RapidStartCRM, pay us some cash every month, use it as-is, and leave us alone. I dreamt of thousands of companies just using the solution as we designed and intended for them to. Well, that last part of my dream never came true. Almost every single customer wanted some sort of "tweaks"! They completely ruined my plan of laying off all of my tweakers...and pocketing their salaries. Resistance is Futile I spent quite a few years trying to crack the nut of I.P. without services. It's okay, my tweakers were aware, and apparently knew better than me the futility of this effort. At some point you just have to play the hand you're dealt. So we pivoted from trying to minimize services for customers, to instead leaning in on that inevitability. Where I had hoped our revenue mix would be 10% Services and 90% recurring I.P. cash, it ended up the other way around. And of our services revenue for Forceworks , 90% of that was coming from our RapidStartCRM customers. This is also why we recast our apps as "Accelerators", an acknowledgement that no app is perfect for any customer. Five Years In Business is great, growth is great, revenue is great, albeit not in the ratios I originally intended it to be... but I got over it. So now what? What could be my next move, to go to the next level? I mentioned in my last post the spark of a new idea, that came as a result of building a new idea, ISV ConnectED . Looking at the WordPress ISV freemium model got me thinking. Some of these WordPress addons have hundreds of thousands of users. I'm sure most of those users are sticking with free, but it does not take a large percentage of them to opt for a "Pro" version or something, to add up to a significant chunk of change. In looking at our Apps, we make 10X in services over the recurring revenue on the apps themselves. If the apps were free, I would be betting that sacrificing the 10%, would easily be made up for in addons and services for much faster growing user base. Decision made! I need a Plan Just removing the costs of some apps was not going to be enough, the strategy had to be more comprehensive than that. A ton of new free users is useless if you cannot monetize them, even worse than useless actually, as there are still costs. Step one, how to support them. Knowing previously, that most customers were going to reach out for help to get the most out of something they were paying for, we had not worried too much about our documentation. We had documentation, but not at the level that would be needed to support a large number of free users. Why do I care about the free users, particularly the ones who are never gonna buy anything? Because we live in a world of ratings today. If your free apps are crap, or useless without paid extras, or you don't support them at all, your ratings in the marketplaces will plummet. Good ratings are hard to get, you almost have to beg even your happiest customers to go to the time to give them. Free users got nothing but time to go blast bad ratings all day long. It is the single biggest risk in the freemium strategy. Fortunately our apps are great, probably because they were not originally developed to be free. Freemium Support So reasonable support is important, even for free users, but you can't go broke providing it. It comes from 3 places in our strategy. The first is more comprehensive documentation. The more issues that can be addressed in your documentation, the fewer frustrations a customer will suffer. But a lot of issues can pop up, that are not able to be covered in even the best documentation in advance. The next step for that free customer is a free support forum. There is no SLA in a free support forum, and hopefully over time, customers will be able to get answers to previously asked questions there, or from other users, as well as us checking in. This is about the best we can offer to a free user, and it should be good enough for many of them. But you have to give them a path forward if that is not enough for them. But that path, at that stage, does not need to be free anymore... but it still can't be too expensive. So we bubble up our RapidADVANCE managed service offerings, a paid program that can provide that next level of support, in a few flavors. But what if that still is not enough? Again, 90% of our business was coming from customers who wanted significant customizations... so this brings them to our Forceworks Support Block model, the model we have used for many years now for current RapidStartCRM customers, or all other non-RapidStartCRM customers, including enterprise customers, and P2P projects. It is basically our SI model. Other Revenue Options We are also working on two other primary monetization paths. The first is what we are calling "Simplementations" via Forceworks. This is something that we have been offering for a while for some of our non-public I.P., and it seemed like a natural fit for our RapidStartCRM apps as well. Basically, Simplementations are fixed cost, scope and time engagements for targeted scenarios. Lastly, paid addons... an area that we will be focusing on heavily in the coming months. Our RapidStartCRM apps, are like platforms on a platform, this was intentional many years ago, but only to streamline our providing services for them. But they are perfectly designed for adding additional "packaged" capabilities quickly and easily. We already have some of these, RapidPROJECT and RapidSERVICE, for example. Again replicating our motion of taking something Microsoft made too complex , and creating a simple version of it. In this case, RapidPROJECT is a subset of PSA capabilities, and RapidSERVICE is a subset of Field Service capabilities. BTW, neither of these require RapidStartCRM as a pre-requisite. But over the years we have built all kinds of things on top of RapidStartCRM in response to customer requirements, and many of those things would have broad appeal, if we packaged them up. So this is going to be a busy development year for Forceworks. I'll keep you posted on our progress. If you are an ISV, I would really appreciate your joining ISV ConnectED , I may need the gas money for my motorcycle.…
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Steve reads his Blog
I had planned on making this two posts, but frankly I have too much on my plate at the moment, so its a twofer. The first part is about something new I launched, and the second part is about a bold move I made. ISV Connect ED I have certainly been one of the "complainers" about Microsoft's ISV programs, including ISV Connect. Well, you can only complain so much, and then, if you are in a position to, you have to take action. I decided that what ISVs were missing, was a community that was ISV Focused, instead of just being in a subcategory somewhere. The ISV Ecosystem is a big business and Microsoft seems to be grasping how important we are, particularly after a recent study they commissioned on ISVs that got their eyes-popping. Toby Bowers confirmed this in my recent chat . Speaking of Toby, he is now the new leader for ISV Connect, taking over for Guggs who is retiring from Microsoft. So, new blood, new opportunities... seemed like the time was right to launch something to help everything move along. ISV Connect ED is a membership site, so it's not free. I would love to have done it for free, but then it would not get the love it would need to succeed... and it will require a lot of love and attention. I won't go into a lot of detail here, I wrote a post on it describing what it is, and why I am doing it, here . But I will say, if you are an ISV, I want you to join and participate, otherwise you better steer clear of me when in-person events resume in the future. My Bold Move Okay, I don't know how bold this seems to you, but it was a pretty big deal to me. I tossed and turned for weeks before committing. As we were building the site for ISV Connect ED, I found us making heavy use of WordPress plugins. Almost every plugin we found had a free version, and then a "Pro" version. For about 90% of the ones we used, we ended up opting for the "Pro" version. This got me thinking about our RapidStartCRM Solutions on AppSource. While our apps have done quite well, I found myself wondering what things would look like if I had 100X the user base. The only way that would happen is either a massive marketing campaign, which would cost a ton, or... make the apps free. Either way the cost is significant. Not only would I be giving up the potential future recurring revenue for the apps, but I would have to stop charging all of our existing customers for them too! How could this work! Obviously, my plan was not to go broke, but "free" certainly does not help a bottom line. Looking at the WordPress model, most of the free plugins have basic capabilities. But if you need something more sophisticated, almost all of them offer a "Pro" version. We could certainly do that. Our core RapidStartCRM apps are intended to be simple apps, but over the years we have built some fairly sophisticated I.P. on top of them for certain use cases, like Project Management and Field Service. So we already had our "Pro" addons started. Also, most customers ended up engaging us to do further customizations, and why not, who knows our app better than us? So there's two revenue generating possibilities... would that be enough? Controlling Costs Imagining thousands of customers on the free app... that could bury us in support costs. Again, the WordPress Plugins developers' model came up. Most of them offered free support for their free apps in the form of a User Forum. Not only does this limit the effort, but more often than not, another user answers the questions raised. If you want more than forum help, you can buy it from the developer, or in some cases upgrade to their "Pro" version to get it. Brilliant! We will replicate that motion as well. Farm Betting I am taking a big risk, but I am not betting the whole farm on this. Our primary revenue source has always been Project Services, often on RapidStartCRM implementations, but about half come from other customers. So trading the potential, and existing recurring revenue from the apps, for what may come with greater scale is not crazy. Or, at least I don't think it is. Well, I hope not, since it is already underway and too late to turn back. Unlocked Again, following the WordPress model, where the plugins are not usually protected code. If you have the development skills, you can edit them yourself. So our RapidStartCRM apps are also all completely unlocked and able to be extended by the customer, another partner or... hopefully by our team at Forceworks . I may be opening a Pandora's box here, but I feel confident we will get our share. Which Apps? So we are making free four existing apps, and one more in the future pipeline: The Original RapidStartCRM , the simple to use Sales and Service app that started it all in 2015. RapidStartCRM Referral , a version for businesses that operate on a referral model. RapidStartCRM Homebuilder , a purpose built sales application for production homebuilders. How2 by RapidStartCRM , an in-app training solution that actually was always free. In our pipeline we have a new "RapidStartCRM B2C" in development for businesses who primarily sell to and engage with consumers. Worst Case The worst case scenario, is not really that bad. It is possible that many organizations will use our free apps without ever opting for a "Pro" anything, or needing any help at all. I mean there could potentially be thousands of customers being introduced to Microsoft's Business Applications as a result of our free apps... I guess that's not a bad thing either. I'll be covering our progress with this approach on the blog at ISV Connect ED , so if you want to see how this ends up, well you'll have to join that!…
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Steve reads his Blog
I recently wrote a post with suggestions for Toby Bowers, the new Leader of the Microsoft ISV Program. I assumed he had read it, but just to be sure, I ambushed him on the phone. If you are a Microsoft Business Applications ISC, this is the guy who will make or break you. We had a great discussion about his plans for ISVs. We also chatted about my latest undertaking, ISV Connect ED , he acted like it was the first time he heard about it, but I already know that it has been chatted up in the halls in Redmond :). Enjoy! BTW, don't forget, Mark Smith (@nz365guy) and I do PowerUpLive every Tuesday at 4PM EST, click here to be alerted, and here's a link to the replays! Transcript Below: Toby Bowers: Hello, this is Toby. Steve Mordue: Toby, it's Steve Mordue. How's it going? Toby Bowers: Steve Mordue. It's going well. How are you? Long time no see. I have a suspicion on why you're calling. I read one of your recent posts, called Suggestions for Toby. Is it to talk through that? Steve Mordue: So, before you talk too much, I got to let you know, the record button is on and I'm going to publish whatever the heck we talk about in the next few days on my podcast, if that's all right. Toby Bowers: Ah, okay. Okay. I've heard about these calls, Steve. Yeah, no. That's fine. That's fine. I've been looking forward to talking to you. Steve Mordue: All right. Cool. So, news. Guggs is headed out the door, and he did the mic drop and you've picked up the mic. Toby Bowers: Yep. Yep. Steve Mordue: Which is a new role for you, but you've been in the periphery of this ISV, but you're now the guy, right? Buck's stopping at your desk, for ISVs and ISV Connect. Toby Bowers: Yeah, no, absolutely. I'm excited with the opportunity. Yeah. Guggs is retiring for the company, and just with the turn of the fiscal year here at Microsoft, we took the opportunity to sort of reorganize a little bit. But as you said, Steve, I'm not new to the ISV strategy or the ISV Connect program. We've been, myself and my team, have been working really closely with Guggs and his team over the past year. Just to sort of explain where my team fits in. So, I work for Alysa Taylor and the product marketing group. We have all of our field sales enablement for all of our sellers and marketing teams around the world. We do our partner strategy all up, not just for ISV. We do customer success. We're focused on usage and adoption and migration. And we also do community work as well, for both first and third party community. So, ISV has always been a part of my core team charter, but as you said, I'm just sort of picking up the mantle with Guggs, and we'll get more actively involved. Steve Mordue: Is it a little intimidating? Toby Bowers: Oh, yeah. No, it is. I mean, obviously this is incredibly critical for us to get right as a company. Such a huge opportunity for us and for this business. I joined the dynamics team about three years ago, and we started talking about this, Steve, because we really didn't have a modern SaaS ISV program, ISV strategy. We were still coming off the old legacy days where, of course, ISVs are critical in this business in driving success with our on-prem business. But we weren't able to sort of effectively translate that into the cloud world. So, really, really important for us to get right. Why it's important for Microsoft is, to be honest, this is just a massive market. I mean, we did some sessions at Inspire recently in fact, this is a $200 billion market. It's a very fragmented market, Steve, as you know, so the better we are in building out an ISV ecosystem and driving those ISV's growth, the more share we can take in this market, and attract ISVs to build on our platform with great solutions that help solidify it in the customer base. Steve Mordue: Was that kind of an eyeopener for you guys a little bit to see the results of that study you commissioned around ISV? I mean, I know you guys had always kind of, in the back of your mind, assumed there was importance in ISVs, but was that an eye opener for you guys as well? Toby Bowers: It was. It was. I mean, the fact that over half that addressable market is going to be driven by ISVs and the cloud in the business applications market was bigger than I thought, to be honest. It's also, Steve, it's interesting. It's split pretty evenly across the sort of the medium business space and the enterprise. So, there's equal opportunity across both customer segments, but for us, the real opportunity, Steve is... And I'd love a chance to talk about the opportunity I see for the ISVs, but for us, the opportunity to take share and reach new audiences through ISVs is something we really talk a lot about in our conversations. Acquiring new cloud customers, the fact that ISVs can build vertical and sub vertical solutions and reach BDM audiences that we're just not that great at it, Microsoft, to be honest. Just represents a huge opportunity for us from a customer acquisition perspective. And then, the last thing I'd say, Steve, is we still sort of have this tactical opportunity to continue to help the remaining customers we have on on-prem dynamics products get to the cloud, and ISVs are obviously critical in doing that, in helping them sort of move their IP from the legacy stuff over to cloud. So, yeah, there's a big opportunity for Microsoft in it, but I also feel like there's a big opportunity for ISVs, just choosing us over someone else in the industry based on just the innovation we're building in and the growth that we're seeing in the Dynamics 365 and Power Platform business, Steve Mordue: Well, they're choosing Microsoft to start or adding Microsoft, if they're already established elsewhere. Toby Bowers: Yeah. Steve Mordue: Both of those are good motions. There's a huge ecosystem of ISVs for Salesforce and some of the other applications out there. And I don't expect them to just drop that and come over here. But you reach a point in any business where you're kind of plateauing, right? You've got your market share and you're maintaining and you've got your steady growth, but if you're looking for a new opportunity to create brand new growth, I mean, nothing like jumping into another sandbox. Toby Bowers: Yeah, absolutely. I mean, I think that's definitely part of it, and it kind of comes back to where we are in our journey with this strategy and this program [ISV Connect], Steve. I think back with the transition from Guggs, we sort of spent about a year in the design mode, and I know we worked with you to bounce ideas off you as a sounding board during that phase, back in the back of the day. And then last year, our fiscal year '20 was really the launch year. And obviously, we launched it at Inspire in July, but then it really didn't become operational for a couple of months. So, the bulk of last year was really helping our existing ISVs onboard and get enrolled in the program, and really the focus that we had on cleaning up app stores, getting everything all nice and certified and enrolled in the program for our existing ecosystem. And we feel pretty good about the result, that we got over 550 ISVs, 1200 apps. We have a good base now, but to your point, now we can sort of transition into going after recruits, right? And not only making our existing ISVs successful, but continuing to build out that ecosystem with new ISVs who are looking at multiple platforms to your point. Steve Mordue: I've been, I guess, probably the best way to put it would be "optimistically critical". I mean, I am an ISV, so obviously I'm bullish and have high hopes for success of the [ISV Connect] program, but the program has had its challenges. I think it's been passed around a lot. Hopefully, you'll hang around for a while with this thing. That's one of the reasons I was asking about the survey, was that it seemed like for years prior to that, like I say, there's been kind of a, yeah, we know ISVs are important, but it wasn't particularly believable messaging, you know? Because I don't know that a lot of the folks inside Microsoft had a clear picture of what that means. It's was just Salesforce is doing it, so we should be doing it too. But I was thinking that study kind of would have really opened some eyes and poured some gas on this motion. Toby Bowers: Yeah. I mean, it really has, Steve, and you're right. And look, I'll acknowledge we've had fits and starts with ISV strategies across Microsoft for several years, and I've been there to witness it. I'm a 20 plus year vet here at Microsoft, and I've worked in pretty much every side of the company from sales to marketing out in the field in different countries, and now here in product marketing working on BPOS and Office 365 in the early days, and then Azure in the early days, and now Biz Apps. We've gone through several evolutions that are related to our ISV strategy, and we've changed course and made some missteps, to be honest, here and there. I think my whole goal, again, in sort of stepping in and taking a little bit more responsibilities with this program in particular is to deliver on the value, deliver on the promise we made to partners. Last year when we launched, we talked about things like access to our field sellers in the premium tier, access to our partners, access to our customer base through app stores in the marketplace, access to platform capabilities. We've delivered some of that, but we still have a long way to go to deliver on the full promise. And so, I'm a partner guy. I had lots of partner responsibility in my previous roles at Microsoft, and I just think if we deliver on that promise and we support our partners' growth, we're going to grow. So, that's my number one goal. And we can talk about some of the specifics in it, but I hear you. And I think we need to stay the course. Now that we're in market, this is the year to really mainstream the program across the Microsoft machine and really deliver on the value that we've talked to ISVs. Steve Mordue: I think one of the challenges with the ISV Connect... well, any of the programs in there is Microsoft is a huge machine, and you've got to get a lot of parts lined up in order for anything to happen, parts that are within your control, other parts that are not in your control. I mean, it's a challenge to get all those things lined up in a groove. And I know that effort has been ongoing. We talked about AppSource as an example of something that Biz Apps doesn't own AppSource. They kind of own their door to it. And so, some things that are kind of in your control, out of your control, some things you can influence, not influence. I guess a lot of it would probably be driven by such as interest in the success of the Biz App side of the business, which is certainly higher than any of its predecessors, right? Toby Bowers: Yeah, absolutely. We have huge sponsorship, not only in support, not only for business applications like Dynamics and Power Platform from the senior leadership team, Satya and his LT down, but even the ISV strategy within that, Steve. I mean, we get a chance to get in front of that leadership team twice a year. We often talk about this ISV strategy, the ISV Connect program, what we're doing. So, it's well known across the company. And I think to your point around the matrix here at Microsoft, and what I would say is I've been around again for a long time and I've worked in most of these teams that are going to be critical for the success of this program, whether it's Nick Parker coming in on the global partner solution side and Gavriela [Schuster], Casey McGee, or on the engineering side, James Phillips and Charlotte Yarkoni, who actually leads our commerce engineering team, including our marketplaces with Azure marketplace and AppSource. So, we've got high awareness, high prioritization to focus and improve in some of the areas, Steve, that we'll probably talk about, we know we need to focus on and improve. But the last thing I'd say in this vein is when we launched last year... Again, you probably know the way Microsoft works. I mean, we kick off Q1 in July. Everyone goes in a little hole for it for a month, takes a couple of weeks of vacation, comes back out, and we quickly get into planning mode for the fiscal year, to sit down and build the pipeline we need, think about the right plans and investments around the world to be successful. And the difference between this year, this fiscal year and last fiscal year from an ISV Connect perspective is we now have this great stable of ISVs and apps ready to go. So, we had 500 ISVs enrolled in the program on day one, July 1. We have 1200 apps. We've got a great set of premium tier apps that we're now working with our sales teams to align to their account and territory planning process. In fact, just earlier this morning, Steve, I was looking at a spreadsheet and you can imagine not to share sort of all the gory detail, but we have these things called sales plays, which are how we enable and align our sales force to go and talk to customers about our workloads and solutions. And we have six sales plays for business applications. Then, we have an industry focus. We have these industry priority scenarios. We have 13 of those. Then, we have 14 areas, we call them, around the world. These are countries and groups of countries around the world. So, if you think about a big spreadsheet with all of those, what we've done is we've mapped our ISV solutions to each one of those to say, "hey, if you're looking to focus on supply chain in the manufacturing industry in France, here's a set of ISVs that are enrolled in ISV Connect", perhaps have an app in the premium tier that you should align to your account territory planning process, so that you can go and engage with them to build pipeline. Steve Mordue: Wasn't that previously like the... What was it? The catalog? The CSP? No, what was it? Toby Bowers: That, yeah. It was the... Well, the OCP catalog is what we used internally. Steve Mordue: OCP catalog. Toby Bowers: Yep. There's a Co-Sell Solution Finder. That's more reactive, Steve. If you're talking to a customer and say, "Hey, do you know a partner that has a solution on X," you can bring up that tool and find one. What I'm talking about is more proactive, actual territory planning with the sales teams to sit down with ISVs and do that sort of engagement, to build joint pipeline, identify joint accounts. So, I just bring it up because we didn't have the opportunity to do that last year, because we were just launching the program. So, I'm optimistic, as you say, critically optimistic that that'll make a difference for us this year, at least on the Co-Sell side. Steve Mordue: When Guggs came in, I was actually pretty excited, because that's really the first time that someone who had been with Microsoft for a long time, had some clout, knew how to work the machine internally came on board, and he was on board for, what? About a year, and then retired. And I thought, "Uh-oh. Now what?" And so, hearing that you took over, I was once again, very excited. I've known you for a long time now. Obviously a completely different personality than Guggs. You are much less of a risk taker, I would say, and much more of a... You're a much more mellow kind of a guy. You seek consensus. Toby Bowers: Thank you, Steve. Steve Mordue: I've always thought you seek consensus more than... Certainly Guggs wasn't big on seeking consensus. I think that's going to be critical to your ISV success. I think... And I admit, I'm not blowing smoke up your butt. I think you're the right guy at the right time for this now, just knowing you the way I do. And obviously, a lot of ISVs will be listening to this. So, I don't want to... I've kind of gotten caught in the past of sounding overly optimistic, and then things not stepping up. But I'm feeling as optimistic as I ever have about you stepping into role and being able to really make it work for everybody. We've got some very successful ISV stories out there, but there's a lot of them that are struggling to get there. I think democratizing the process a little bit, because we definitely over-index on the big ISVs, which I get. We need to... But big ISVs didn't start as big. We need to have motions that bring all people, raise all boats. Toby Bowers: Yep. Steve Mordue: What are you thinking about, now that you're brand new in role? Although you're not oblivious to what's going on. You've been in the periphery there of this thing fairly deeply for a while. What are you thinking about things you want to try and attack right away that you think you can get some traction on right away? And then, maybe things that you want to focus on a little more long-term, so we can kind of see what we can expect quickly, and then what we can kind of expect down the road? Toby Bowers: Yeah. Well, I appreciate that your sentiment, Steve. We have known each other for a long time, and I know you're a straight shooter, and you're also just a great champion for the broader partner ecosystem. So, I would just say, just to put everyone at ease, I've been around almost as long as Guggs and have been behind the scenes, like we said, on this for a long time. So, I don't want anyone to feel like I'm going to come in and start cracking around and changing things up. I think to your point around risk taking, this whole design launch mainstream phasing that I talked about, the program is sound. I truly believe we have the right program in place for the long game, with the revenue sharing model, the different points of value that we need to provide to our partners. Like I said, we just need to deliver on that promise now. So, I'm not going to come in and change things drastically. I'm going to take what we have, and do my darnedest to make it successful Steve, because I truly believe it is set up for success if we have the right focus and attention. So, that sort of leads me to the way I work. I am a collaborative guy. I've got a lot of good relationships across the organizations that will be required to make this program successful, whether it's the partner team or the sales team or all the folks out in the field who are closer to where the rubber hits the road. So, I feel pretty confident about the amount of focus and energy, and what I can do to really push it forward from here. As far as short term, long term, to answer your question, Steve, and I loved your blog. I read it. In fact, I listened to it. I was out walking the dog, and I listened to it. So, thank you for reading it out loud. I don't know where you found that picture by the way. That's about a decade old, so thank you. That's very flattering. Steve Mordue: Send me a new one. Toby Bowers: Exactly. But there's a couple things. I would say to some of your suggestions around... Let's just take the first one around equalizing. We probably did over-index a bit on the Co-Sell side of things last year with our premium tier, especially, and getting those partners enrolled and engaging with our field around Co-Sell. That's what, to be honest, a lot of the larger partners were most excited about. And there's been a couple of really good examples of success there, Steve, and companies like Seismic . We just had Inspire. We talked about a few different ISVs and sort of success stories, but Seismic is a great example. Sales enablement solution, three clouds, Azure, us, Teams as well. They really got plugged quickly into the Co-Sell motion. And they talked about pipeline growth of 5X in the first 90 days. That's a smaller group of ISVs that are in that premium tier app, and they've just seen a ton of success. Sort of taking a page out of the Azure Co-Sell playbook, and now applying that and extending it to ISV Connect. So, we're going to continue to focus on that. Like I said, we're able to kick off our fiscal year with this set of ISVs. And so, I feel pretty confident about continuing to push on the Co-Sell side. Where we need to focus more, Steve, is to your point on a couple of the other value points that we talked about. First is access to our ecosystem, right? We've got massive partner ecosystem, all shapes and sizes. SIs, local SIs, regional SIs, the big guys, resellers, CSP partners. Today, we've got some partner to partner benefits, kind of matchmaking benefits as part of the program, go to market program. We've got such an opportunity in the future to tap into those channels in a bigger way. You think about incentives or our transacting partners reaching into new markets and geographies around the world. That's going to be an area of focus for me going forward. And then, the other piece around AppSource. You had some great feedback on AppSource, and I know you've been giving us feedback on AppSource, for years. Steve Mordue: Yeah, since it launched. Before it launched, actually. Toby Bowers: Yeah, exactly. This is going to be a real short term focus for me, Steve. The fact is we've been on and are on a little bit of a journey with AppSource, but we've got eyeballs in there. It's got a monthly active usage of 4 million users, right? And growing. So, what we've done in the last quarter with AppSource is really worked on some of the plumbing underneath. It was just not where it needed to be when it came to search, discoverability of apps, just block and tackle, basic stuff. So, we worked with the engineering team to really focus on just fixing up that plumbing underneath. This next few months where we're going to focus is the overall user experience. So, the website itself, focusing much more on the solutions themselves, merchandising the right apps, really helping customers who are going there find what they're looking for quickly, not just from a search perspective, but an overall user experience perspective. And that'll happen literally in the next few months. And then, from there, Steve, you know where we're going to go. We're ultimately going to light up transactability of third party IP through AppSource. That'll come together with the ISV Connect program, so that partners can really choose how they transact. But we do feel like for the right apps and the right partners, that'll really light up this big Microsoft install base of customers as a new way to sell and transact their apps. So, that's where we're going. Steve Mordue: I think that would be particularly critical for the startup ISV, or the one who's coming over from another platform. Toby Bowers: Yep. Steve Mordue: Because it's a big enough challenge to build a worthwhile solution, but that's only the beginning as an ISV of getting where you need to get. you've got to build some sort of a licensing construct to protect it, and you've got to build some sort of a billing platform to get paid for it. So, to the degree that you guys can offer some sort of plugin capabilities on those sorts of things, I think that's going to open up for a lot more ISVs to engage, because you've just lowered the bar of entry to really, if you've got a good solution, if you've got good IP, you can jump in here. We'll take care of more of this plumbing for you, because it's definitely, I think, kept some folks on the sidelines or a lot of people have ended up just making apps free, because they don't have a way to protect or sell them, which isn't what the goal was. Toby Bowers: Yeah, totally, Steve, and look. I'm going to be honest. We got to get better in this space. This is an area that I just see a huge opportunity for us to focus on and improve. We've seen some success there. I talked to Trevor [Nimegeers] at this company called ITRAK 365 . It's like a safety management app for waste management. Again, talk about vertical focus. Yeah. But he's getting leads from AppSource. He's going... Canadian based company. He's cracking into New Zealand and winning some deals over there. And just the infrastructure that can enable that geo expansion through a marketplace like that has a lot of promise for a lot of our ISVs. But you mentioned something important as well, which I missed earlier. So, in addition to the marketing benefits, the go to market benefits, the Co-Sell benefits, we're still working really hard with the engineering teams, whether it's Charles [Lamanna] and his team, or the marketplace team on platform capabilities. So, obviously, we've got tools and stuff today with ISV Studio. We've got telemetry. We've got install telemetry today. We'll have usage telemetry tomorrow. We'll have licensed management capabilities tomorrow. That'll flow into transactability. So, a lot of those platform investments that we can make from an engineering perspective ultimately come together to sort of paint a nice picture for ISVs who are looking to tap into that. And again, strong focus and sort of commitment across the engineering teams to do that. Steve Mordue: And when you say tomorrow, so everybody is aware, you don't literally mean tomorrow. Toby Bowers: I do not mean Labor Day. That's a very... No, no, I don't. Yeah. I mean, I don't have, and I can't share specific dates, Steve, but we are on this biannual release cycle with James and his team. Obviously, you know our release cycle there with October and April. The commerce and marketplace team is on a biannual cadence as well. So, we just fit into those engineering cycles to continue to champion for what ISVs need to be successful, in that long list of work that those teams will do to just get it higher and higher on the list. And we're really moving in the right direction. Steve Mordue: And I see a little bit of a parallel with the ISV Connect motion and really the whole Power Platform motion. My last call with Charles Lamanna when I was asking him about what are the big things that they're planning next? He said, "Actually, we're going to focus on making everything we have work better." Toby Bowers: Yeah. Steve Mordue: We have all the parts that we need and they're all out there. They're not necessarily wired up as ideally as we'd like, and you can't just keep launching, launching, launching. At some point, you've got to take a look at the pile you've built and make sure that it's organized and sorted and working, well oiled. And I kind of feel that way about ISV Connect. All the parts are there. We don't need any new, necessarily any brand new things, some add-ons here and there. But it's really just making that whole pile of components work like a well oiled machine. Toby Bowers: Yeah. I think the table's set. We just got to get people eating. Like I said before, I think the program is sound. The elements, the business model. It's a self-fulfilling business model. The more success we have, the more we can invest and grow together. And I do think that we stay the course. It's all about execution and delivering on that promise. Now that said, there are a few things, like we were just talking about that we need to add quickly or fix, to be honest. Things like getting AppSource where it needs to be, some of the benefits. You and I have talked a lot about internal use rights, and that is a benefit. We just need to get that done. I know we've been talking about it for too long. There's a broader Microsoft dialogue going on around ISV and programs and IURs. I'm just going to move forward with the right IUR strategy for ISV Connect, because that's just something we have to deliver on, Steve Mordue: Just put your head down and crash through. Toby Bowers: Exactly. Exactly. So, that's a big one. Steve Mordue: So, I recently started a new venture myself kind of on the side, towards this ISV Connect motion. I don't know if you'd heard anything about it. Toby Bowers: No, I haven't. What are you doing? Steve Mordue: ISV Connect ED . Toby Bowers: Oh, nice. I like the play on words there, my friend. You should be in marketing. Steve Mordue: Yeah, yeah. Well, I'm adding an ED to the end of it, but essentially, it's... We don't have a good external resource. I mean, you can go to Microsoft, and you can read all about ISV Connect and just read stuff, but there doesn't seem to be a community for ISVs to compare notes and... Not so much, I don't want to create a place for people to go bitch and complain. I want to create a place where people can go and learn what works, what doesn't, how to be successful, and see if we can nurture some stuff around there. So, hopefully you'll be hearing more about that. Toby Bowers: Well, that sounds intriguing to me, Steve, but yeah, I'd love to learn more. I mentioned one of the other things my team is responsible for is our community strategy. And I know you are an active member of our MVP community, our Partner Advisory Councils, our sort of partner community at large. So I'm all for what you do with that initiative, Steve. I think, to me, community, and I know we've caught up at user groups and things like that. It's just such a great listening mechanism for us. We can do all the research we want, and talk to our field and talk to partners, but that partner to partner community engagement to sort of identify common themes, and then have multiple voices bringing that back to us is just so important for us to be focusing on the right areas. Steve Mordue: Yeah. Toby Bowers: And I'm just a huge advocate. I mean, this is... In my career, I spent so much time out in the field with customers and partners, and I just feel it's so important for us to listen at this point. Again, I feel like we've got the right strategy in place, the right program [ISV Connect] in place. We need to listen to what's working and what's not working, and then act quickly that. So, I love it. I love that you're pulling that effort together, and I'd love to stay connected with you on it as far as opportunities to engage or just understand what you're learning. Steve Mordue: Oh, I'm going to lean on you, buddy. I'm going to lean on you. Toby Bowers: You can lean on me anytime. In fact, I was going to say that. Steve Mordue: One of the things that Guggs did, he kind of disbanded the ISV PAC and kind of went to that broader... But I think you definitely lose something when you've got... It's funny. When we go to any of these events, when there's a room with like 20 people in it, everybody's happy to talk. When there's 200 people, nobody says anything. Toby Bowers: Yeah. Steve Mordue: It's like the group gets too big, and then who was it? Tony. You remember Tony de Freitas? Toby Bowers: Yeah, I do. Steve Mordue: He made a comment on one of my more critical posts recently. And he just said, "Feedback is a gift." Coming from someone who used to be on the inside of Microsoft, I know you guys are desperate for the feedback. I mean, it's all... Give me the feedback, tell us what's working, what's not working. And it doesn't help when nobody says anything or they just complain. Getting that feedback is critical, and that's part of what I'm hoping to try and accomplish here is to help you guys get some of that feedback. Toby Bowers: Yeah. Absolutely, Steve. I mean, we can't do this in a vacuum. It's a new program. It's a new model for us. And so, feedback is critical, and there's multiple ways to get that feedback. The good news on the PAC is we're getting the band back together, so we're sort of re-establishing as we move into this next horizon. But yeah, in fact, I was going to offer, Steve. I think me coming in now, I would love to do this connection with you maybe in a few months as we sort of round out the calendar year to see what progress we've made, and you can keep me honest and I'd keep you honest. And I would love to engage with this community that you're thinking about building. Steve Mordue: Well, I hope that... I had Guggs on about once a quarter to just kind of talk about what's up. Toby Bowers: Okay. Steve Mordue: I definitely feel like you are a person who is more amenable to the feedback. Toby Bowers: Yeah, yeah. Steve Mordue: More interested in hearing it, and will definitely act on it. So, anything else you want to say to folks about you coming in here, and taking the role? I mean, I'm feeling very positive. I think everybody should feel very positive. I think everybody needs to give you a fair chance to take some action, but I'm feeling very confident about it. Toby Bowers: Well, I appreciate it, Steve. No, I appreciate the call, although it was a bit unexpected. I'd just wrap up with my number one job is to deliver value to our partners. That value will come in the form of growth, plain and simple, because if our partners are successful, we're going to be successful with this. So, that's what I'm going to be maniacally focused on for this next six months. And yeah, I look forward to catching up again soon and hopefully talking about some of the mutual successes that we've had. Steve Mordue: Sounds good, man. I'll be pinging you soon. Toby Bowers: All right, Steve. Well, thanks again for the call. I appreciate the opportunity to have a chat. Steve Mordue: All right. Bye bye. Toby Bowers: Bye bye.…
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Steve reads his Blog
I guess it is fairly obvious from my post yesterday , that I am pretty pissed off at Microsoft. I have always been one of those " Don't point out a problem, without suggesting a solution " kind of guys, and I have done my share of pointing out problems with Microsoft's Business Applications ISV efforts. So here are some ideas. Why ISVs? First, why should Microsoft even give a shit about ISVs? Certainly prior to sharing in ISV's revenue there did not appear to be much reason, based on how Microsoft had historically engaged with ISVs. I guess we have to thank Salesforce and their successful AppExchange for Microsoft paying any attention at all. For years I have watched various Microsoft people get up and say " ISVs are critically important to us ", followed by very little in the way of tangible actions. Obviously, " We have a marketplace too! " should not be the end goal here. What Salesforce keenly grasped, was that ISVs either generate business they would never have had, or make their platform for the customers they do have, extremely sticky. We know this from our collective efforts to get customers to move away from Salesforce; very often it is some ISV solution they depend on, that is making them stay put. It has gotten easier to be sure, but mostly because of Microsoft's integrations to other Microsoft products being superior. SFDC customers are giving more weight to that now as so many of them have switched to Microsoft 365. On one side of the scale is this fully integrated Microsoft story, and on the other they have the disruption of losing a critical ISV solution for which Microsoft has no ISV comparable. What Microsoft really needs is 10X the number of ISVs they have today! It all costs money I don't recall when Salesforce started AppExchange, but I don't think it was long after they launched the company. I also don't recall whether they took a cut of ISV's revenue when they started, but they clearly do now. It would not have mattered, because at the time, they were essentially the only game in town. 800 lb Gorillas, with triple anyone else's market share, can afford to be demanding of ISVs. I have no doubt that SFDC makes a huge amount of revenue from this motion, not only for licenses that they would not have sold otherwise, but also their ISV vig. I have no idea what they invest in their ISV ecosystem, but I am sure it is not small, because building and maintaining it is not cheap. But SFDC recognizes the value. Up until recently, Microsoft apparently invested the change found in the sofas around campus. I applaud James Phillips and Charles Lamanna for seeing they were not going to win the race with SFDC on Microsoft's trajectory at the time, and pivoting into new ground. The "Citizen Application Platform" is an entirely different approach, but "Citizens" are not going to build robust mission critical applications on Dataflex. Microsoft needs customers on the big money, sticky stuff that ISVs have historically created for SFDC. Cart before the Horse? Guggs apparently realized there was no budget to create this thriving ISV ecosystem that Microsoft would be the primary beneficiary of, and decided ISVs should fund this. Let's think about this for a minute. You have a historically dismal track record for ISVs, you publicly acknowledge that, and step one towards a fix is to ask ISVs for the money to fix it. I had suggested at the PAC meeting where the Revenue Sharing idea was first floated, that maybe they should "prove" success for ISVs first, but I guess they didn't hear me. I am sure that Microsoft has had to spend some of their own money on this effort, as I doubt that the Revenue Sharing income is significant yet, but they need to spend a lot more. And they need to spend it fast and right, otherwise they should suspend the Revenue Sharing for a while until the value for ISVs is there. I can see it! When I throw my head back, and let the possibilities swirl around, I can see success for ISVs, and Microsoft. I know I have been a strong Microsoft advocate in the past, and call me a flip-flopper, but I could easily become one again. Even though SFDC does not have it perfect, I still envy their ISVs today. And, even though he is a egomaniacal as they come, Benioff still let ISVs shine, less concerned about brand positioning, than money rolling in the bank. So, what might I suggest to Toby? Stop Antagonizing Maybe they can't see it. Maybe they don't actually believe that ISVs are critical, or even necessary. Maybe they see us a necessary evil for certain edge case deals. Maybe they see an ISV ecosystem 10X the size it is today as a huge hassle. That would certainly explain things. Or maybe they don't think any of that, and simply don't know what to do to solve the problem. Launching a Revenue Sharing program at this stage, in spite of knowing full well that it was going to piss of the entire ISV ecosystem, does not appear to have been the best first step. If this is going to work, we have to all be smiling the whole way through. No pain, no gain, only works for the gym, Equalize the effort Right now, particularly in Co-Sell, my guess is that 5% of the ISVs are getting 95% of the attention from Microsoft. I understand that's where the quick money is, but that is also short-sighted, scorecard-based thinking. The goal should not make the few large ISVs even larger, it should be to make all ISVs larger. If you want to recruit a lot of ISVs, they need to see that they won't just be given the crumbs left over after the existing large ISVs have had their fill. Kind of like how many organizations and governments have a minority program, where a certain amount of projects must go to a certain population, Microsoft should come up with a similar program for small and start-up ISVs. Engineering I am aware that Toby will not have much influence over what the product teams do, but it impacts ISVs in a big way. The last thing the product teams think about when they create new features is the ISV story... it's more of an afterthought. As a result, many of these features or products are not what I call "ISV Ready" for various reasons. Every product team should have an ISV advocate, from the very first conversation about a new product or feature. I mean there's like 6,000 people in the BAG organization now, surely we can task a few of them with watching out for ISVs. AppSource One of the touchier subjects for ISVs is AppSource. If done right, AppSource could be a primary benefit to ISVs, and draw for new ISVs. I know AppExchange certainly is for SFDC. Unfortunately, AppSource for Bizapps ISVs has become little more than brochure-ware. Poorly built, hard to use, and not promoted nearly enough. I am also aware that AppSource is not "owned" by the Business Applications Group, they only own their own door to it, so again, Toby may have his hands somewhat tied. Supposedly, AppSource has been very effective for Azure, and some of the efforts have been toward trying to copy that success. But the Azure buyer is a completely different person than the BizApps ISV buyer, and AppSource is not giving that buyer what they need. What specifically might I do? First, I would reverse the process. Right now when you enter AppSource, a significant amount of the page is dedicated to showing you a bunch of "Featured" solutions. The problem is, AppSource has no idea what I might be looking for. The odds that I am looking for a solution, that you happen to be "Featuring" are pretty slim. I'm not even sure how these apps got "Featured". I would delete that whole section. The entire focus on the landing page should be helping me find what "I" am looking for. This is an area where Microsoft could actually do something better than AppExchange. Make this landing page into a "Process" that guides me easily to understand what I want and need first. Only then, show me a list of options, limited to that. Once I land on a solution that looks promising, give me the opportunity to book a time on the ISVs calendar for an in-person demo or conversation, not just a generic contact form. Circling back to the "ISV Ready" conversation, AppSource is not ISV Ready. Test Drive is clumsy and largely ineffective. Trials only really make sense for widgets, and there is no way to expire the trial unless the ISV builds that into it. The promised commerce component is nowhere in sight, and even if it was, the churn challenge will be similar for ISVs as it is for Microsoft when customers just try and deploy something on their own, again other than a widget. More important to ISVs than commerce, would be a universal licensing system that we can just plug into. Licensing schemes end up costing ISVs a lot to build and maintain, and customers end up with a different one for each solution they install. Lastly, drop the dime on promoting it. Stop being the marketplace that is down the street around two corners, and be right up on main street. I have more, but that's a good start. Benefits To offset the shock of the Revenue Sharing program there was a promise of benefits. Most of the benefits seem to be targeting new ISVs, and that's fine, but when you look at the costs of an ISV, and particularly those that Microsoft is in the unique position to help offset, there are some obvious opportunities to create value. One of them is IUR. Historically Internal Use Rights have been a benefit of Competencies. But for an ISV, competencies are not nearly as important as they are for SIs. For a short time there was an ISV Competency, that again seemed to have been put together without talking to any ISVs. It was summarily cancelled without any replacement plan. Either this should be reworked and brought back, or IUR should be a benefit of ISV Connect. It is not reasonable to expect ISVs to have to not only pay Microsoft for development platform, but then also ask for a share of the revenue earned as a result of the platform we had to pay Microsoft to use... Pick one! I am aware that IUR is not free to Microsoft, but I did say Microsoft needs to spend some money on this. I think I will leave this here, for now. I am aware that I ruffled a few feathers with my last post, and may with this one also, but to be honest, the survival of my business depends on Microsoft getting this right. I see no upside in keeping quiet.…
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Steve reads his Blog
" Microsoft has always been a partner-led company, and we are committed to creating more opportunity for our partners across our businesses ." and " This ethos of being partner-led will be there in everything we do ". Satya Nadella has said these things, but I am wondering... Lip Service? One of the major factors that brought me to transition my company from a Salesforce Consultant, to a Microsoft Partner in 2011 was the "Partner Ecosystem" story. After almost 10 years with SFDC, during which their relationship with consultants was borderline antagonistic, I was fed up. Microsoft sounded like a breath of fresh air. But their "Partner Ecosystem", particularly for ISVs, has been weighed on the balance... and found wanting. No Bigger Advocate You would be hard-pressed to find a bigger advocate for Microsoft's ISV ambitions than myself over recent years. Having drank the Koolaid and creating I.P back in 2015, as we were all strongly encouraged to do, I had a vested interest in their effort. Many of my posts started out apologetic for my previous encouragement, but ended up positive and hopeful. But, I am starting to lose hope that Microsoft will get it right. Was Saleforce Better? There is no doubt that at the time I came over in 2011 Microsoft's business applications were complete shit compared to SFDC. This was clearly demonstrated by their market share. I took it on as a personal challenge to seek out anyone at Microsoft who would listen, and press annoyingly for change. Over time, my incessant ranting made its way through the grapevines of Redmond, and I was invited to participate in many things. Multiple Partner Advisory Councils, more private phone calls and in-person meetings with Product Managers and leaders than I can count, and an MVP designation. I can honestly say that today, Microsoft has an undeniably better product than Salesforce on every measure other than market share. Not Alone Before I start sounding like some kind of narcissist, claiming to have single-handedly straightened up the leaning tower of Pisa, I was far from alone in this mission. While it is satisfying to see aspect of products or programs that I know I had a direct influence on, many others had similar influence over other critical aspects. Each of us "trouble-makers" have a vested interest in our mutual success. My Biggest Disappointment? Almost every aspect of the ISV effort for Business Applications ISVs has been found "wanting". Up until last year, the various aspects of the ISV efforts have been led by lower level soldiers with little authority, no imagination and no understanding of the ISV business. " Hi, I'm Joe, I'm in charge of this important ISV facet, I just transferred from the MS Paint development team where I have been for the last 15 years. How can I help? " Sorry Joe, but you know less than my dog about this business. Not Guggs Fault After years of watching the revolving door of low-level solders step up to within two feet of their targets, raise their rifles and miss... a General showed up. Steven "Guggs" Guggenheimer, a long-time veteran of Microsoft and self-described "Fixer" was brought in. I first met Guggs at a Partner Advisory Council meeting with about 15 other ISV leaders. He struck me as a no-nonsense guy who planned to get things done. He also struck me as a guy who did not need, or want, our opinions. ISV Connect Guggs' brainchild was ISV Connect. A program developed mostly in the dark, that basically seeks to take a share of ISV's revenue, in exchange for some benefits. It is not optional, it is "Pay to Play". The program was launched in lightening speed with agreements being sent out to ISVs almost immediately who were expected to sign or leave. The minimum tier is 10% of your revenue, in exchange for some benefits from Microsoft that in my opinion are mostly worthless, at least for existing ISVs. If you opt into, and are accepted into, the 20% tier, there was an additional promise of Co-Sell business, meaning Microsoft's own sellers, would pimp your solutions. At a recent Inspire session Guggs, as well as in a few interviews I have done with him, intimated that some ISVs are happy. I have not met any of these ISVs, and Guggs just announced his eminent retirement. Now what? Back to my post title The Microsoft ISV landscape has become a risky place to be. In order to continue participating, we now have to find another 10% or 20% of margin. For those with paid resellers in particular, this is a huge challenge. If the program was producing 10% to 20% more business for ISVs that would be one thing, but that is not what I am experiencing, nor any other of the many ISVs I have talked to. Another risk is Microsoft's continued encroachment into first-party vertical solutions. If you were not lucky enough to be acquired, like Field One, Microsoft has caused problems for several ISVs as they entered their spaces. Project Management and Marketing are a couple of areas that Microsoft has moved to displace existing ISVs. I was also very suspicious of the entire Accelerators program. Their recent announcement of an Asset Leasing Accelerator sounds pretty damn vertical to me. So what's the play? What is the message we are getting from Microsoft? " Come join our booming ISV ecosystem, where we will take a share of your revenue in exchange for basically nothing, and if you are wildly successful in spite of that, we might just knock you off! " I would like to believe that is not the intent, but as my ex-wife used to tell me, " Actions speak louder than words ". Is there still reason for hope? Maybe for a lucky few, but I am not seeing any for the masses at the moment. Let's see what Guggs' successor can do. Update 08/06/2020 I received an email from Guggs after this post went out that included the following: "I’m curious about a few things, but one in particular caught my attention. I can’t remember the time I said the ISV Connect program was “widely successful”. I’m sure I have almost always said something along the lines of ….. some things have gone well and some things we need to do more work on ….but can’t ever remember using those words. I don’t mind you pushing hard on the company or the program, but I would be happier if you didn’t attribute absolute phrases to me unless I had indeed used them….which isn’t really my style." After digesting this, and thinking back, I agree with Guggs, that he did not ever proclaim that the program was wildly successful for ISVs as I wrote above. I apologize for attributing that sentiment to him. He also confirmed in the email that Toby Bowers would indeed be taking over his role as leader of the effort. I have known Toby for probably 5 years now, and hope for the best as he walks into what has been a very challenging issue for Microsoft. Toby has a completely different personality than Guggs, and time will tell if that is more effective at driving the program, and easing the discontent among ISVs. At the end of the day, the buck stops at the leader's desk. To be fair, Guggs came into a pile of shit, and I am aware that a lot of work needed to be, has been, done in the background on his watch. I would like to believe that while ISVs have still not seen the success they should have, Microsoft is closer than before at delivering on that soon. Hopefully Toby can push it over the goal line for us all.…
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Steve reads his Blog
" We're not looking for a Sales solution ", said the person on the other end of the phone call. I have heard this many times. While those of us in the Power Platform arena know that Sales is only one of the business problems we can solve with the tools today, many still think "Sales" when they hear Dynamics 365. Once more from the top I have previously explained some of the evolution of what was formerly known as CRM, at least as it relates to Microsoft's offerings.... but I will try once more in super-layman's terms. Up until just a few years ago, Microsoft had a product known as Dynamics CRM. It was a Sales focused solution, primarily aimed at Salesforce.com as the market leading competitor. Originally only available as an on-premise product, meaning it was installed somewhere on machines you owned or controlled, it became available as a SaaS offering in 2011. As a SaaS offering, this meant that it was now running from machines that Microsoft owned and operated, and the application was made available for you to use via a web browser. Not dissimilar to how you use LinkedIn, Facebook or even Salesforce. This is essentially what Cloud means. The Salesforce Clouds Salesforce, which also started as a Sales focused Application, although cloud from the very beginning, started to see opportunities in adjacent markets quite a while ago. They created some new "Clouds", there came the "Sales Cloud", "Service Cloud", "Marketing Cloud" and more recently, the "Commerce Cloud". Clearly redefining what CRM, and Salesforce was, to encompass a much broader spectrum of business solutions. Microsoft followed suit. Clouds vs Apps Where Salesforce created distinct "Clouds" for their expansion, Microsoft created distinct "Apps". The difference in approaches is not easy to grasp, but fortunately, it is not important to grasp either. Looking at it from the Microsoft side, their Dynamics application had spread out some to include some post-sale capabilities, primarily around servicing activities. While Dynamics was always highly customizable, it was delivered with a very specific kind of business model in mind. First, it was assumed that you sell things, directly to customers, and most likely those customers were businesses (B2B). It was also assumed that you had some sort of incoming Leads from somewhere, and that your sales process began there. It was assumed that your made contact with these "Leads" to determine their interest, and if interested, you would convert them into "Opportunities, together with an Account and Contact record. While at the Opportunity stage, it was assumed that you would create "Quotes", and in order to create Quotes, it was assumed that you needed a Product Catalog. Once a Quote was accepted, it was assumed that you would create an "Order" and close the Opportunity as "Won". Once the Order was fulfilled, it was assumed that you would want to create an Invoice to get paid. Now that the "thing" has been sold, it was assumed that you would want to offer some kind of post-sale support with Case Management, and of course you would want SLA management for your support staff. Microsoft made a lot of assumptions about how a business would work in their Dynamics CRM offering. In my 20 years in CRM, I never met one that fit. Bending and Molding I am not sure if it was there from day one, or if it came along later, but the XrM capabilities are what made Microsoft's Dynamics CRM a viable product. Dynamics' XrM capabilities were similar to Salesforce's Force.com capabilities. Basically they both gave the ability to customize the offerings... significantly This was a good thing because neither of their offerings fit any customer. The general public was seeing basically Sales solutions offered by Microsoft, oblivious to the fact that they could be completely customized into something totally unrelated to sales. It was even tougher for Salesforce to shake the "Sales" only stigma, since it was baked into their name. You would have thought that Microsoft could have taken advantage of this opportunity, but until recently, the product was lead by a bunch of idiots, who were so focused on catching up with Salesforce, they missed the clear opportunity to just pass them. Back to customizability: over the years, customization became a very big business. Working with skilled Partners, customers were taking the products offered by Microsoft and turning them into completely different things, like Member Management solutions for Associations, or Grant Management solutions for Non-Profits, or Franchise Management solutions, etc, The list is endless of what has been done to "CRM" with the XrM customization capabilities. Breaking shit apart Several years ago, Microsoft embarked on a journey to separate their Dynamics capabilities, first from each other, and then from their underlying platform. It's a long story, that is still ongoing, and I have written about it several times in the past, so I will cut to the chase here. Dynamics CRM is no more, instead we have several Apps that carry the Dynamics brand. Dynamics 365 for Sales, Dynamics 365 for Service, Dynamics 365 for Marketing, etc. Sounds eerily similar to Salesforce's clouds. In the same time frame of releasing these finished applications, Microsoft also made the underlying platform that they are all built on, available as a separate product. Again, Salesforce was there first, with a "platform only" offering quite a while ago. More on that shortly, but Microsoft also kept building on their apps, adding intelligence and a whole slew of capabilities. Sadly, the original "assumptions" that Microsoft made about how businesses operate, still dominate their offerings, but luckily XrM is still available to make them actually fit. Power Platform Microsoft's "Platform-only" offering is called the Power Platform. Think of it as a smorgasbord of ingredients, but there is no finished stew. If you want a finished stew, then you could look at Microsoft's "finished" apps. But in my experience, all of those required significant tweaks to the ingredients to get right for anybody. "Tweak" is probably not the right word... decapitation is probably closer. This is not a knock on Microsoft's first-party apps at all. As aspirational showcases of modern technology, they are pretty awesome. But most customers I run into have neither the time, patience, budget or need for much of that "aspiration". This customer needs to go straight to the Power Platform. In most of the cases I can recall, we spent more time modifying the first-party apps to fit customers needs, than if we had just started from scratch. So, in almost every case, that is what we are doing today. Long Live the Platform Microsoft's Business Applications Group is on the odd position today of potentially eating it's own head. When you hear them discuss the Power Platform, it is with great zeal that they talk about its capabilities to solve "small" problems. There is clearly a concern about cannibalization of their first-party apps coming from the platform, either by customers or ISVs. While they continue to position Power Platform as a solution to small problems, the only reason it could not solve the biggest problems that exist today, would be artificial limitations that Microsoft may place on it, to protect their first-party apps. As we continue to solve bigger customer challenges with the platform approach, I sense a tightening coming from Microsoft. Is Dynamics 365 Dead? My co-host on our weekly live show , and good friend, fellow MVP Mark Smith , once publicly proclaimed " Dynamics 365 is Dead ". This sent shockwaves through the community at the time, (Somehow I even got blamed for it), but he was only voicing what a lot of us were thinking, the day Microsoft made the decision to open the platform. So is Dynamics 365 Dead? That's a good question... I know for myself, a customer has to have a pretty specific need, that is only met by one of Microsoft's pre-made apps, before I would suggest even looking at them. However, Microsoft continues to invest heavily into capabilities and marketing of their apps. I am sure it would be quite a financial blow to Microsoft's Business Applications Group if everybody dropped their pricey apps, and built their own on the inexpensive platform. But I, for one, am mostly suggesting they at least explore just that. Interestingly, I seem to recall Microsoft telling their partners a few years ago, that moving to the cloud was going to hurt partners a bit financially in the short term, but it was the future.…
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Steve reads his Blog
When Model-Driven Power Apps first appeared on the scene, it brought with it a $40 per user license called Power Apps P2. Earlier this year Microsoft launched a $10 per App "Pass". Clearly $10 is going to get some eyeballs, along with a lot of skepticism about it having a place in an organization that may be paying $100 per user plus. So let's talk about it. "Your going to like it" I believe it was at last year's MVP Summit; there was an off-site dinner for the bizapps crew. I saw Charles Lamanna, Corporate VP of the Low Code Application Platform, sitting at a table with an open seat next to him, so I snagged it. Charles is well aware of our RapidStart efforts, and has been a supporter since I first met him when he came on board the bizaaps team. At some point in our conversation, he leaned in a quietly and said they were working on something: " You are going to like it ". He was vague on details at the time, but he clearly understands our RapidStart business model, so I got pretty excited. Announcing the $10 Per App Pass! I had a few "pick my brain" calls with the Microsoft team about the upcoming "per app pass" before it became public. I specifically recall asking, more than once, if they were prepared for "unintended consequences". The problem with "unintended consequences" is that they are not always easy to spot in advance, particularly if you have a filtered view. Microsoft is a technology company, and the Business Applications Group is made up of a lot of technology-minded people. A recurring theme seems to be their inability to view things through a business eye. This is how the Team Member licenses ended up being abused. To a technical thinker the Team Member seemed like a perfect solution to a particular challenge. To the business person on the ether end, it seemed like an excellent opportunity for exploitation. The Scorpion and the Frog There is a classic fable that this reminds me of: "A scorpion, which cannot swim, asks a frog to carry it across a river on the frog's back. The frog hesitates, afraid of being stung by the scorpion, but the scorpion argues that if it did that, they would both drown. The frog considers this argument sensible and agrees to transport the scorpion. Midway across the river, the scorpion stings the frog anyway, dooming them both. The dying frog asks the scorpion why it stung the frog despite knowing the consequence, to which the scorpion replied: "I couldn't help it. It's in my nature." Microsoft often finds itself a Frog, dealing with customer Scorpions. What will a Scorpion do with a $10 Pass? They will seek ways to exploit it. In our case we have taken full advantage, rebuilding all of our apps the be able to run on any license, but in particular, the $10 App Pass. I don't feel like we are exploiting, after all Charles did say I was going to like it. This kind of felt like tacit permission, even encouragement to head down this path. It's a two-way street, Charles also needed some ISVs to showcase this approach for other ISVs to consider this path as a great way to join the ecosystem. Wait a Minute! The risk of cannibalization of the first-party applications was obvious, and not lost on the team. In one of my chats with Charles , I asked about this probability, he said: " I would say we are quite confident on the Microsoft side that the value and the intellectual property and the ongoing services and support and SLAs and integrations that come with the proper Dynamics applications can and will continue to command those prices. " But just to be safe, they decided to toss a blanket over a few key entities and restrict them to the first-party apps. At the time there was, and still is, a lot of discussion about API limits across the stack, and the Per App Pass was given a pretty low limit of 1,000 per day. I had not liked the "Restricted Entities" idea from the jump. In that same chat Charles alluded to more Restricted Entities coming, but in a later chat with Charles , he conceded: " restricted entities as a concept are largely antithetical to our common data service, common data model and vision. And they were just like the least bad option to go make sure that we appropriately can license Dynamics apps. " I had suggested a different approach in another post : "The real value of the first party apps is in the logic layer, not the data model." . While I'm sure my comment was not the trigger, it is the direction they are now heading. Devilish Details So the "replacement" scheme for restricted entities is still being formed, but basically the vertical fences between certain entities, will pivot to a horizontal line between the first-party tables, and their proprietary logic. Where restricted entities was a quick and easy solution, this one will take a lot more work for Microsoft to execute. It seems proprietary logic is all over and pretty deeply wired. Will this be better? It's hard to say at this point. Where before we had some entities that could not be used, the other ones, that were not restricted, were being used... along with their OOB logic in many cases. So it seems like instead of pointlessly replicating entities, we will now instead have to create all of our own logic, and possibly our own forms, dashboards etc.. But, it seems completely fair to me. No one is entitled to get a Prime Steak for the price of a burger. Burgers So what will this mean for your $10 app plans? Well, Microsoft giveth and Microsoft taketh away. Eventually, you can have a "no cliffs" scenario. The cliff I am referring to is starting with vanilla CDS and building some apps, and then realizing that the first-party apps have a lot of features that would like. Today, you cannot get from here to there without a migration. Not a "cliff" exactly, but definitely a hassle. This path will be cleared "in the fullness of time", where a simple license swap will be all that is required. Today, you can install the first-party schema on your vanilla CDS, it is available here on Github . As of now, even with this schema installed, you do not have a direct upgrade path, but the migration should be easier going from an OOB entity to an OOB entity, than mapping your custom one over. When the path is "cleared" will using this approach today just start working for upgrade later? Good question. So, does the $10 Plan make any sense? Depending on your use case, it is completely viable. We have developed many very sophisticated solutions on CDS with the $10 Per App Passes, even without utilizing all that is available to that pass. Mostly starting with one of our RapidStart accelerators, we have built Project Management applications, Field Service applications, Referral Management solutions, each of which has become an accelerator on their own. What will you miss out on? For many customers, they won't miss out on anything, again depending on your needs. Like Charles said, there is a lot of value in the first-party applications for those that need it. Top Down We started with the premise that many customers just want something simple to use at the lowest possible cost. So we built our accelerators with the $10 pass in mind. You can start with a vanilla CDS, and many do. But many customers already have Dynamics 365, and a significant number of their users are making use of those high-value proprietary features. But not necessarily all of their users, particularly in larger organizations. A significant part of the work we are seeing today is taking certain use cases, building a specific app for those users, and dropping them down to $10 passes, sharing the same data as the first-party users. This tends to be an addictive motion. Is this cannibalization of high cost licenses? Yes, but I would argue that if a user can do their job with a $10 license instead of a $95 license, that makes the customer happier and less likely to consider a change in platforms. Unintended consequences are not always a bad thing.…
I usually avoid discussing my products or services on the blog, people seem to get annoyed. But I was having a chat with an ISV the other day, who said he had found me via this blog. He asked me how much of my ISV opinions were "theoretical", and did I actually have any ISV solutions. So if you don't want to hear about my stuff, stop reading or listening now. AppSource As many of you know, I have had a love/hate relationship with Microsoft's AppSource . Apparently I must be a masochist, because I have still not given up... on the potential anyway. Anyone else would have, and many others have, given up, but I keep falling for the rhetoric. I am in frequent contact with the team behind it, and I keep pushing as hard as I can for improvement. At this point, I pre-date any of the current team's involvement with AppSource, since I was involved with it before it even launched a few years ago. Maybe that's why I just can't let it go, I have way too much invested. I still get excited when the revolving door spins and a new leader takes over, hoping I can accomplish some incremental change, before the door spins again, and the conversation starts back at square one. The Promise AppSource is more than just Power Platform and Dynamics 365 related. It has a few other doors for Microsoft 365 (formerly Office 365) apps, and Azure apps. But the impetus for the Business Applications door was frankly Salesforce's AppExchange . Basically Salesforce was kicking Microsoft's ass by leading with ISV solutions making their product look highly specific to industry customers. This was not new, this has been a Salesforce strategy for a long time. I can remember sitting through many demos, that included a lot of third-party I.P., where it was not clear where Salesforce stopped and the third-party began. But it didn't matter to customers, all they saw was a targeted, relevant solution. In the meantime, the Microsoft seller in the following demo showed the generic CRM solution, and talked about the ability to customize. Game, Set, Match to Salesforce. This was not lost on James Phillips, leader of the Business Applications Group for Microsoft. It's a Freaking Store The internet is full of online marketplaces, for all kinds of things. AppExchange of course, but also Amazon, Target, etc., almost everybody has an online marketplace these days. The online marketplace technology road is well-traveled at this point, the focus is now on UI, customer conversations, cross-sell, upsell, etc. For some reason, Microsoft decided to re-invent the wheel and ignore well established norms. AppSource is an example of a poor user experience, with no excuse for it. In spite of the obvious importance, and huge competitive advantage that Salesforce made out of their Marketplace, Microsoft has just not put in the effort. Why? I have no clue, but the revolving door has not helped. Still today, I do not see the level of commitment that I think there should be, not just with AppSource, but with ISV in general. But I can't help but continue to believe that eventually, someone will have the full brightness of the lightbulb go off over their head and become the hero to all. In the meantime... In spite of a clear lack of light at the end of the tunnel, I have pressed onward. It may well prove in hindsight some day soon, that it was a complete waste of energy, but for now I am cursed to be an eternal optimist. So we have doubled down on AppSource. Our RapidStartCRM App was one of the very first apps in AppSource. I would love to say that it was based on the success of that AppSource effort, that I was compelled to create more, but that would be disingenuous (fancy word for "Big Fat Lie"). If pressed for a reason to continue, I would say that I still feel there are unmet needs out there for I.P., regardless of AppSource. I still feel compelled to build I.P., even if the success of that hinges on everything other than AppSource. At this point, we'll also put it in AppSource, with zero expectations, but why not. Our Apps We currently have five apps in AppSource, all under our " RapidStart " app brand. These were all built by my team at Forceworks Global. Four of these are horizontal, targeting the concept that Dynamics 365 is simply more complicated than it needs to be, and always has been. It's no wonder the adoption of any CRM solutions is so low. We launched our first application, the Original RapidStartCRM in 2015, targeting SMB who was struggling mightily with the first party applications. Our churn rate was near zero, so we knew we were onto something. Microsoft noticed also and made a couple of moves in our direction. The first effort was "Business Edition" targeting SMB. I was annoyed, but not for long. Microsoft's appetite for SMB comes and goes, and it went out the door before Business Edition even launched. There was one survivor of that effort however, Dynamics 365 Marketing, which was originally going to be an SMB solution. More recently Microsoft took another stab at SMB with "Sales Professional", an effort that is still ongoing. Again, I was annoyed, particularly when they would ask me for feedback on their SMB app. But again, since Microsoft does not understand the SMB customer, they built a complicated SMB app. Their SMB appetite will wane again soon, as it does perennially. One of my favorite opportunities, is when a vertical customer wants us to customize our simple horizontal application. This was what led to our first vertical version: " RapidStartCRM for Homebuilders ". The key challenge to building vertical industry applications, is being able to get the domain knowledge of that vertical. It's even better when you can obtain the domain knowledge, while being paid to apply it to your I.P.. Last year we recast our apps as "Accelerators". The idea that any app is going to work perfectly for any business out-of-the-box, is not realistic. In almost every case there was a "customizations" effort, sometimes small, other times quite large. I wanted to make sure that customers understood that our app meeting their needs exactly without any effort, was not realistic, so "Accelerator" seemed a better characterization. We have three other apps. RapidStartCRM Referral , is our app for referral model businesses, which are different than businesses who sell products or services. The three apps I mentioned so far are really offered as standalone applications. We also built two applications intended to be Addons to either our applications, or any other applications built on the Common Data Service. Our How2 by RapidStart is a simple application that we offer at no cost, that basically brings your internal video training content into whatever Model Driven Application you might be using. Lastly, we built RapidStart Project , after having deployed PSA enough times to know that for most customers' needs, it too is a monster. We have four more applications in our development pipeline, that I will talk about after we launch them. Consulting Services Offers Another facet of AppSource is being able to create Consulting Services Offers . Again, I was engaged with the team long before that concept launched, and we had one of the first consulting offers in the marketplace. This has also failed to meet expectations from a marketplace, and we have tried multiple types of offers and strategies. As of this writing, we have a total of eight consulting offers, both free and paid. So far the only ones that seem to generate any interest are, of course, the free ones. I would be very interested to hear of any partner who offered a paid consulting offer that a customer took them up on via AppSource. I can't decide of this is a doomed motion or not, because again, AppSource sucks at getting the right message in front of the right customer. Not wanting to rely on AppSource, we have our paid offers on our website also, so we'll see how that goes. So that about covers it for now. For anyone who thought my ISV opinions may have been "theoretical", you can now see that they are actually the result of continuous disappointment.…
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Steve reads his Blog
In this episode of "Steve has a Chat", I catch up again with Alysa Taylor, Corporate Vice President for Microsoft, to get the latest from the Queen of Marketing for Microsoft Business Applications Group. We chat about the success of Virtual Events, Customer Insights, Power Apps vs Power Apps, and touched on SMB. Enjoy! BTW, don't forget, Mark Smith (@nz365guy) and I do PowerUpLive every Tuesday at 4PM EST, click here to be alerted, and here's a link to the replays! Transcript below: Alysa Taylor: Hello? Steve Mordue: Alysa. Steve Mordue. How are you? Alysa Taylor: I'm doing well, Steve, how are you? Steve Mordue: Well, you know why I'm calling, right? Alysa Taylor: I have a hunch. Steve Mordue: Yes, yes. I've got the record button on and I just wanted to see if you had a few minutes to talk about just things. It's been a while since we caught up. Alysa Taylor: Yeah, absolutely. Would love to spend some time and just chat. It has been a little while. Steve Mordue: So we just came off Business Applications Summit the first pivot over to a virtual conference. And at least from the rumors I hear the attendance was off the charts compared to an in person conference. Alysa Taylor: It was off the charts. It was actually our first Microsoft virtual, we classify events and this is a tier one event, so it was our first one that we executed as a first party tier one event in a virtual capacity. So we were both nervous and excited. We had over 50,000 people registered. So it really was... And it's a very different format. We condensed two and a half days into a half day. But I would agree, we were very pleased with both the online turnout. And then I think, from what I heard from the community, the format worked well. It was a nice mix, we did a prerecorded keynote, then we had live sessions that were moderated with subject matter experts. And then we were able to do some networking and fun interstitial type activities in between the programming. Steve Mordue: You know, I would have to think that if I were Microsoft, having done in person events for so long and the expense of doing those and the coordination of putting those together, because it's a production when you guys do those. And then looking at the number of attendees there were able to make it because of schedule or cost because of getting approval by their employers and versus now suddenly a virtual event at no cost. I mean, there was no limits to anybody being able to get into that. And while we might lose some of that in person networking amongst one another, from Microsoft's standpoint getting the information out to as broad an audience as possible seems like this is a better way to do it. Alysa Taylor: You know, my team and I have talked a lot about that and I think in the post COVID-19 world, because we're learning so much about virtual events, I think we'll end up, and no timeline on this, but we'll end up probably in the future in some kind of a hybrid type scenario. Because I do think there is always that benefit of face to face, being able to network, shake people's hands, see old friends. So I think that in person will never completely go away, but I think we're learning how to do virtual events that will compliment the in person. And so I think, and again, this isn't an official statement, but I think there'll be a world of probably smaller, more intimate events. And then the big scale events will be virtual because at the end of the day we've had over 150,000 views of our content from Microsoft Business Application Summit, compared to we do 7,000 to 10,000 in person. So it's a very different scale. Steve Mordue: Yeah. It really is. When you think about the ability to touch just so many people that way and the expense. I think that, obviously, we all got thrown into this virtual event motion when we weren't quite ready for it and our tools weren't quite built for it but ready or not, here we come. And I was, I can't remember the earlier virtual event that you guys did that I... Oh, I think it was the launch maybe? Alysa Taylor: Yes, we always do the virtual launch event. That we've been doing for a long time. Steve Mordue: And that was pretty good, but then you still thinking about as a large scale event, which we've historically done in person, how does that translate in a way digitally, virtually that it feels as valuable to the people? Not withstanding the fact that we've now got 10 times as many people that can see what's there, but that the event feels as much like a live in person event. And I think the tools are getting... Obviously you guys are tweaking the tools for just that kind of experience, like you said, with some of the networking and we're kind of figuring it out, but as we get this stuff figured out, and these tools for virtual events are just 100% rock solid and exactly the way everybody would want. And I don't know, it seems like the future of live events across, not just Microsoft, but industry-wide, is going to be tough. Alysa Taylor: Well I think the thing that we're learning is how to do programming to your point. Because when we did the virtual launch event, it's our engineering leads and our product marketers doing content and then demos. Content, then demos. And I think what we learned with the Microsoft Business Applications Summit is that how much that programming matters, the back and forth, being able to do moderated forums, because it keeps people engaged. And we do it in much shorter segments. Like the virtual launch event is two hours. We were doing 35 minutes segments in the Business Application Summit. And yes, so to your point, I think doing the right programming allows us to have virtual events that are engaging. And then we get the benefit of being able to scale to such a degree that we can't do in person. Steve Mordue: Yeah. Obviously time zones will be a challenge for anything like that because you're going to have people doing multiple versions of their session at different time slots to be able to capture everybody. And that's a trick. I think one of the things, some of the feedback I heard from some of the folks was that they thought the sessions times might've been a little short because oftentimes the presenters were pressed right up to the time limit with their content and there wasn't much opportunity for questions. In those live events we're just peppering the person with questions throughout the whole thing. So that would be an interesting one to... Alysa Taylor: We got that feedback as well. And I think that's right. I think that's good that we spend a little bit more time and we're learning as we go. And I sort of said that, so I think that is one thing you will see us is more Q&A time. I think the presentation time was probably the right amount of content, but then allowing for more Q&A is important. Steve Mordue: Yeah, I thought it was nice in the new, whatever the platform you guys were displaying all that in, that, typically at a live event, I'll walk into a session and five minutes into it I might decide, "You know what? This isn't what I thought." And I want to bounce out and go down the hall to another one. And the virtual equivalent of that to be able to drop out of one and see below it, "Here's the other ones that are going on right now." And just click a button and bounce from one to another, I felt like we're getting closer to that kind of experience with the tooling and stuff now too, which is handy. Alysa Taylor: Good. I'm glad you had that experience. That's great to hear. Steve Mordue: Yeah. And of course they're all being recorded and available immediately or as soon as possible, is just huge. Because then you don't feel... Like I can remember at live events feeling like there were three different things I wanted to see, but I could only see one, and since they weren't necessarily all recorded, you just had to miss some content. But now, of course, they can all be recorded by default and you have no excuse to miss anything today. So I think it's pretty cool. Looking forward to see where that goes. Steve Mordue: So what are some of the exciting things in your mind? Because you look at this through a different lens than some of the other folks, because you look at it through that marketing lens. And so you would see things differently than maybe Googs or Phillips as interesting or important. What are some of the things you think we should all be really paying attention to? Alysa Taylor: Well, I think there's probably two things and I think James and I would say the same probably on both, which is, I think we've continued to bring some pretty remarkable innovation to the portfolio. And when you see things, products like Dynamics 365 Customer Insights, that has been one that's just been phenomenal to see the customer adoption on this. And I don't know if you saw like Chipotle was a big customer, wall-to-wall sales floor shop that is adopting Customer Insights. We'll announce here Walgreens is doing the same. Alysa Taylor: So the customer data platform and being able to have a 360 degree view of the customer, even in times of crisis as people are moving to digital selling and remote service, knowing your customers is even more important. And so it's been very exciting to see the innovation that's been built over the course of the last couple of years in market and seeing the customer adoption on that. And then I think the broader vision of how Dynamics 365 in the Power platform fits into the Microsoft Cloud. Alysa Taylor: You see very large customers like Coca Cola that are moving their entire IT and cloud infrastructure to the Microsoft Cloud. That's inclusive of Dynamics 365 and the Power platform and doing some pretty cool things with it. Power platform, just even in the recent environment, we released a set of crisis response templates that have just gone like wildfire throughout healthcare organizations, first responders, organizations needing to be able to get in touch with employees, with volunteers, with those that are on the front lines. So you see the direct impact that it can have and it's pretty incredible and pretty inspiring at the same time. Steve Mordue: I mean, I think we're all pretty amazed at what citizen developer has been able to do when given some tools that could actually do things with, which they never had before and I'm continuously seeing citizens building apps to solve problems that they have in their department or their area that there never would have been budget approved for a partner SI to come in and build something like that, or go buy an ISB solution, all these problems that have gone unsolved forever, it seems like suddenly are getting solved and they're getting solved quickly and easily without great expense. Steve Mordue: Problems that never would have been solved. They just had no other way they were going to get solved before this. That's been phenomenal to see the change of the platform, frankly, just in the last couple of years, that huge pivot towards that citizen has just opened up so much. You're talking about Coca-Cola. I mean, that's a lot of what's driving that there I'm sure is department heads, line of business people, seeing something that's accessible and fiddling around over a weekend and creating a solution to a problem they've had for years. Alysa Taylor: Absolutely. And we have the Unilever executive team in to meet with [Sati 00:12:04] and his directs. And they have done this whole movement to empower their frontline workers with the Power platform to give them the tools to solve problems. And we always say the value of the Power platform is putting tools in the hands of those closest to the problem. And Unilever is just an incredible story of creating a digital factory of the future that is completely from bottoms up, it's from frontline factory workers that are giving input, using Power Apps, Power Automate, Power BI to automate manual tasks that would take them way too long to do, to have insights and analytics to the health of the supply chain and the factory line, having a digital command center that they could access through a power app. Alysa Taylor: So you see all of this. And then the great thing about the Unilever story is they've been really working to empower their frontline workers with these tools. And then as COVID-19 happened, they actually just took that same rapid innovation model and use it to do things like pivot to being able to scale up production and ventilators because they had, if you think about their IT their traditional IT and developer workforce is everyone. It's not just limited to one department or one set of individuals. Steve Mordue: Yeah. That's still a challenge for Power Apps. I know in big organizations, we're frequently running up against the wall known as IT that is resistant to almost anything in a lot of organizations. Sometimes they're very intransigent to get them to think about new things. You know, the, oh, it's escaping me now, the name of the enterprise management tool that you guys released for templates... At any rate- Alysa Taylor: You talking about EMS? Steve Mordue: No, the stuff that was released by the team to help enterprise manage Power App growth in their organization. Alysa Taylor: Oh, yes. Yes. So yeah, within Power apps, absolutely. And that you saw that Toyota is a great example of that. They actually use that enterprise management, so enabled their organization, all of their employees, to train them, enable them with Power Apps as a technology, but then they have within the IT department, to make sure they can do things like handle confidential data sharing, they used a set of control mechanisms with Power Automate and Power Apps. And so this gives the IT department that final sort of go, no, go on what gets published. But you still have the empowerment of the citizen developers across the organization. Steve Mordue: Center of Excellence. Alysa Taylor: Yes. Steve Mordue: That's the term I was thinking of. So, Center of Excellence. Yeah, I think that was key to really having this thing takeoff because before the Center of Excellence, I know that there was some concern with IT about, "People are going to go crazy out there with our data. We don't know what's going on." And that Center of Excellence toolkit really should allay a lot of those concerns. It seems like it has. And we still have a couple of challenges in the market that I know I hear a lot of partners and I struggle with around licensing. Steve Mordue: And I know licensing is a necessary thing, but man, does it ever get challenging. And it seems like, I guess, it's just the downside of having lots of innovation is every new thing that comes out we need to figure out, "Okay, now how're we going to license this?" And we end up with lots and lots and lots of licensing conversations with customers trying to figure things out. It's one of those things, they sit back and say, "Microsoft needs to solve that." But then when you think about it, it's not an easy problem to solve having lots of different models of licensing. Alysa Taylor: Well, we have lots of products. I will say, our design principle is on simplicity. And I think we have, if you look at what we've done with Power Apps in particular, we reconstructed the licensing model to be on a per app per user. It used to be, if you remember, based on feature, right? What was canvas versus model driven application development, which is incredibly hard for an organization to figure out. And so we've really worked to try and simplify the licensing, but at the end of the day, we have a lot of products. Alysa Taylor: In licensing, I always tell our internal teams this, licensing, we go for the 80-20 rule, we designed for 80% of the scenarios and there's always going to be the 20%, and we actually strive to do 90-10, can we hit 90% of the core scenarios? But there's always going to be very unique scenarios that we can't solve for, which is why we do different custom type deals. But our licensing, our principles are simplicity, customer centric and designed for as much scale as possible. Steve Mordue: Yeah. I've started to take the position with other partners that are complaining about the old days when we only had like three licenses to sell, and now there's maybe 100 different or more SKUs out there, that this is just a new part of your practice. This is something that you need to be proficient in and competent in, just like anything else that you're doing, and that is how to help a customer navigate the licensing. To make sure they're not over licensed or under licensed, that they're using licenses the right way. It's just a whole new motion that we didn't have to worry about before that you're just going to need to learn and understand. Have somebody on your staff that understands the licensing or can reach out and get answers because it's part of the business now, it's just part of the business model. I think the worst thing that happens is a partner just gets lazy. And frankly, we saw this even with Microsoft seller, just go in and sell the enterprise plan to everybody. Alysa Taylor: [crosstalk 00:18:19] Yeah, when I started three years ago, we sold two things. That was it. We sold the customer engagement plan and the finance and operations plan. We'd two things that we... There was maybe six standalone SKUs under those two things, but everyone just sold the plan. And so yeah, going from two to a number significantly higher than that, I do have empathy. We've ramped and changed a lot in three years, but I think we are at a place right now where we think we have the right model for how we bring new products in and we're trying to drive for consistency now. So we don't have a unique pricing, I had this meeting with my team yesterday, we don't want to have, three different types of pricing models for the insights line. We want to have one. And so we're trying to now strive for consistency across the different product lines. But yeah, you're right, going from two to 100 is a leap. Steve Mordue: Yeah. And then ditching the plan, I think, was great because not just Microsoft sellers, but you know, partners and SIs, it didn't require any thinking about what kind of license the customer needs, just put everybody on the plan. But that wasn't in the customer's best interest. They're paying for all this functionality that this particular user doesn't need. And just because somebody didn't want to go to the effort of figuring out, "You know? That user could probably get by with some lesser license or some other license." Or something like that. And it's forcing us to have to do more work to figure it out. But I think the winner at the end of the day is the customer. They're just not overpaying. Overpaying doesn't help any of us because if they're over purchasing, then they end up churning because they don't see the value. So we want to put them on the right SKU that gives them the right level of value and then they won't churn. So I think it's definitely important. Alysa Taylor: Yeah I mean, that such a huge thing. When I say the principles are simplicity, customer centricity and scale, having a plan where you're... I don't know, Steve, if you've ever met a human being that's a marketer, a salesperson, a customer service person, a field service person, all in one, but I haven't yet, that'd be a superhuman, I think. But that's how we sold. We sold a per user license with five different job descriptions against it. Steve Mordue: Yeah, yeah, yeah. And it's interesting because it's also changed the landscape of the partner community, because as you guys launch new products, these are new skillsets. Alysa Taylor: Right. Steve Mordue: And almost each one of these is deep enough that, with the exception of maybe the largest partners out there, you're just not going to find one that has the skill set across all of these different things. AI on the insight side and development of Power Apps, the canvas apps and flow. There's just so many different pieces that we really, as partners, are having to look at how we build our organizations differently. "I need a Power Automate expert. I need an expert in this. I need an expert in that and the other thing." Whereas before, everybody was an expert in everything. Now there's just too much. Alysa Taylor: Right. Yeah. Now it's got to be deeper. Deeper levels of expertise. Absolutely. Steve Mordue: So one of the things that's not... It's not negative, I'm not going to go negative on you, but one of the things that has concerned me and I still see confusion in the marketplace is about Power Apps. What I call Power Apps versus Power Apps. Alysa Taylor: Oh, interesting. Say more. Steve Mordue: Well Power Apps started out of the Office 365 side with canvas, mostly on SharePoint, embedded in the Office 365 licensing, all these enterprise customers using Power Apps. And then Power Apps also became a name used for something that technically was completely different, right? Model driven Power Apps. And there still is confusion, consistent confusion, among partners also, but mainly among customers, about the difference between these two things that have the same name. I know we've talked about converging them, and there is some convergence going on, but not at the license level, right? That Office 365, that customer who thinks they have Power Apps licensing because they have Office 365, they can't build a model driven app on CDS, that's a different Power Apps license. And how do you think we can make that story clearer to end customers that there's two things called Power Apps, essentially? Alysa Taylor: Well, I think we're a little early on this podcast because we'll provide some clarity in July to the market. But what I would say is today, what is seeded in Office is exactly what you're talking about. Which is Power Apps the maker, but it does not have the common data service underneath it. And so it's effectively the head of Power Apps without the CDS back engine on that. And so you have a lot of people that are using Power Apps, but they're their data source is SharePoint list. We'll release in July what we are doing to make that a more seamless story. And I think you'll be pretty excited. But we're just a little early for me to talk about it. Steve Mordue: Understood. Well, good to hear there's some thinking about it. Alysa Taylor: So it's coming. And it's coming very soon. Steve Mordue: Obviously I come from the CRM world, so I'm a CDS guy and I think model driven, but I don't have anything against, or any problem with, canvas apps on SharePoint list. I think there's tons of scenarios where that makes perfect sense, but there's tons of scenarios where the customer would be infinitely better off having built that on top of the common data service than on top of SharePoint. And right now I think there's a lot of customers out there that think they're using Power Apps. Steve Mordue: I mean they don't have any reason to think that they're not using all of Power Apps when they're just building on top of SharePoint list and kind of making some things much more difficult or much less effective than they could be, and not realizing that, "Hey, there's a whole other side here that is way more powerful, depending on what it is you're trying to do that you should be looking at." And I continuously find myself having that customer conversation. "Well, we already have Power Apps. We already know all about Power Apps." And then pulling up a demo of a model driven app. And they're like, "What's that?" "That's Power App." So looking forward to the clarity. [crosstalk 00:24:58] Looking forward to the clarity in July. Alysa Taylor: Well, and it's not negative. Know that your feedback and the MVP community, our partner community, the feedback that you guys give us is what allows us to be able to learn and adjust, and that's what we're doing. And so I think you'll be pleased in July. Steve Mordue: So one of the other customer segments that we've focused on for years, and is still an important segment to us is that SMB customer. And I go back and forth from feeling like Microsoft is very concerned about that customer to Microsoft is not very concerned about that customer. Almost weekly I see motions that seem like they're helping and then motions that we've got such a revolving door with some of the folks that have looked at SMB. How do you feel about that SMB customer? And how we should be attacking that customer base? Alysa Taylor: Well, it's an incredibly important customer base for us. And I think that we have a model in which we have a workforce, in my mind they're sort of two discrete workforces that work with our SMB customers. So we have a digital sales team that allows for both inbound and outbound triaging of those customers. And then, as you know Steve, we spend a lot of time making sure that our partner workforce has the right incentives, offers, skills to be able to service that community as well. And so I think those are the two facets in which we deploy against our SMB community. Alysa Taylor: And we've seen some really phenomenal customer wins that are in the SMB space. And so we want to make sure we've got the technology and the right resources for that customer base. But there is a very, very high commitment through our partner channel and through our telesales team to service that customer segment base. And I think in our world we say SMB, but there's managed and unmanaged really. Because there are some very, very large customers that we would classify historically as SMB, which I've always had a little bit of heartburn about because they're [inaudible 00:27:16] they're a big business, they're just not managed under our management. Steve Mordue: Well you got a whole rack of levers. Alysa Taylor: I'm going to have to wrap here in a second. I have, speaking customers, a customer meeting that I need to attend to. Steve Mordue: Perfect. Perfect. All right. Well, I appreciate the time and look forward to catching up with you again soon. And maybe seeing you again in person some point in the future. Who knows when that'll be. Alysa Taylor: Yeah. We don't know when, but definitely. So thank you, Steve. Thank you for everything. Steve Mordue: Yeah, thank you very much for the call. Bye. Alysa Taylor: Same. Bye.…
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Steve reads his Blog
In this episode of "Steve has a Chat", I catch up again with Steven Guggenheimer "Guggs" to get the latest on the ISV Connect program. It seems that the word is out at Microsoft about calls from me... they all seem ready now. But I still had a few surprises for him. Enjoy! BTW, don't forget, Mark Smith (@nz365guy) and I do PowerUpLive every Tuesday at 4PM EST, click here to be alerted, and here's a link to the replays! Transcript below: Steven Guggenheimer: Hello. This is Guggs. Steve Mordue: Hey, Guggs. Steve Mordue. How you doing? Steven Guggenheimer: Good. How are you doing? Steve Mordue: You know how I'm doing. You know why I'm here. Steven Guggenheimer: I do. I do. I assume we're get to go do a little update session, and so I know or I assume you're recording and- Steve Mordue: You bet I am. Steven Guggenheimer: ... whatever I say is ready to go. Steve Mordue: You got time? Steven Guggenheimer: Sure. Yeah, I got a little time. Steve Mordue: All right. Perfect, perfect. Well, it's been a while since we talked. It's actually been a while since we've heard from you. I was looking, and I think November was the last post, kind of an update to the world of what's going on. I've been hearing the hammers banging back in the background, but lots of folks, lots of ISVs are reaching out to me for some reason or other, saying, "Hey, what's the latest? What's going on? What's happening on that ISV front?" Steven Guggenheimer: Yep. Like you said, lots of hammers in the background. Once you get into that middle of the year, you're just mostly heads down trying to do two things, trying to solidify all the work that's going on for this year, so working with the field. The team went out and did a field tour and, on lots of calls, we have our middle of the year checkpoint. You're just grinding away on that, and you start doing the planning for the next fiscal year. It turns out our Q3, which is January, February, March, is kind of double busy. You're working pretty hard to do whatever tweaks you need for this year and you're busy planning for the next year, and so I think everybody's been pretty heads down. Steven Guggenheimer: Then you get into January and February with the virus coming out, I think you're busy trying to figure out, "Are we going to do [MBAS 00:02:13] live?" You plan for one version of it, and then you plan for a different. You're working with customers and partners. I think all of those things combined means everybody's busy. My virtual team gets together on a regular basis, and I've got a couple of calls after this, so that's where we're at. Steve Mordue: The ISVs have definitely had some challenges with Microsoft. Not all of this, of course, is within your area. You're working on the program for ISVs that will link to the products, which you're not related to the products. You're related the program. But on the product side, even, the ISVs are having some challenges. I know that there's been ISVs that... The platform keeps shifting, keeps moving around, new things added, things dropped. I even know some ISVs that have said, "Hey, they just launched something, and it kind of wiped out my whole solution." Steve Mordue: I think there's multiple things going on on the ISV side that's got a lot of them nervous, and I think they're looking for some reassurance that, "We bet on the right platform, and was that a good bet, and when are we going to see a payoff on that bet?" What kinds of things can you say to maybe reassure some of these ISVs that are out there that are scratching their heads saying, "Hmm, what's next? I mean was this a good bet?" Steven Guggenheimer: Yeah. I can't think of a better bet right now, but that's me. Of course, I'm on the wrong side of the fence for that. The- Steve Mordue: Well, we're all biased. Even us ISVs are biased. Steven Guggenheimer: Yeah, we're all biased. Steve Mordue: We're all biased. Steven Guggenheimer: Well, people want a little reassurance that, to your point, that they made good decisions. From a platform and product perspective, there's probably never been more energy in the combination of Power Platform and D365 than we have today. I talked a lot about product truth. I didn't think there was a lot of product truth for an ISV in the platform SaaS offerings if you go back five years when we were in the DPDx days. Steven Guggenheimer: James and [Mohamed 00:04:24] and Charles have just been cranking along, and so from the breadth of the portfolio and the quality in that link to Azure going down the stack and that link to SharePoint and M365 going up the stack and the coherence in the platform. Then we've been cleaning up. I mean God bless the team for all the work they've had to do to clean up just years and years of monolithic offerings that weren't in good shape. That speaks a little bit to the change of the underlying platform. Steven Guggenheimer: We're probably as solid as we've ever been. We've got a twice-a-year release train. The notes come out early. We did an ISV session for the partners to get ahead of it. We'll do that again on an every-six-month basis. Satya is sort of heavily invested. Scott's heavily invested. Amy, our CFO, is heavily invested. I think there's both product or platform truth. There's good energy in the marketplace. I mean we're growing very well. Steven Guggenheimer: Can't say anything. Q3 will be coming up, but you look at Q2 and Q1, you look at just quarter over quarter, now the platform's growing and, if the platform's growing, that's opportunity, in particular, Power Platform, Power BI, some of the D365 services. I think all of that speaks to just incredible momentum. I see a decent number of ISVs coming into the program and the platform unsolicited wanting to take part in that. Steven Guggenheimer: Now, the one place people might feel a little discomfort is, as the platform solidifies and as the services solidify and we add things like AI and mixed reality in there, there might be places where people were making an investment or were looking to extend that we might be extending in that area. I would say, look, if you're an ISV on the Microsoft platform, historically, one of your trademarks is being somewhat nimble. I don't care if it's all the way back to the Windows days and Windows 95 working your way up through the internet era or intelligent cloud, intelligent edge. The value of a platform is that balance between giving developers something to build on and having enough coherence and consistency that both customers and ISVs can count on it. Steven Guggenheimer: There's a fine balance there in terms of where you add features or functionality or new capabilities to keep up with what your competitors are doing, to keep up with what the customers are asking for. It's a balancing act. I think the good thing, at least in the Dynamics side, is that we're always open for conversation. Whether it's myself or Greg or Mohamed or Charles, look, we'll pick up the phone and we'll have the discussion. There'll be places where people might feel uncomfortable that we've gone in that direction. Great. We'll have that conversation, and we'll talk about, roughly, where we're going without breaking NDAs on either side. Steven Guggenheimer: My feedback to ISVs has always been the, "There's always someone at Microsoft who thinks, someday, they're going to build something that competes with you, so let's focus on the 90% where we don't compete and know that there's going to be 10%." I think that's just a truism. Look, energy is really good. I mean product coherence is good. Product truth is good. If you look at what's going on, right now, during the COVID response and the pickup for the Power Platform in terms of helping hospitals and healthcare workers and quick solutions, holy crud. Steven Guggenheimer: Then the new areas are good conversation, so let's have the discussion. I mean I know a lot of the historical ISVs have been around a long time, and some of the work they did that was either custom on the product side or custom in terms of working with our field as we make that available to everybody, that feels a little less comfortable. We do a good amount of handholding for that. Steve Mordue: Yeah. I think one of the things you guys have been telling ISVs, for years, as a way to build a business but also, in a way, to protect your business is to go vertical. The more vertical you can get, the safer you are. You guys are not going to go there. A lot of horizontal ISVs, and they're... If you're horizontal, you're plugging a hole. You're always at risk that Microsoft's going to get around to the time to plug that hole. You're definitely safer going vertical. Steven Guggenheimer: That's for sure, and that's even more true today. As some of our competitors invest in the acquisition of vertical solutions, it opens up that direction more. I would say, as a company, we're making that pivot, albeit slowly but surely, to industry-led versus product-led. We've always had product conversations. We've always had audience conversations, developers or IT pros. We've always had sides of organization enterprise, but industry was always kind of a... not as strong a direction in terms of how we went to market. We pivoted the company pretty heavily, and Azure's doing a lot of this work at M365, and so is Dynamics. In industry-based solutions, those are always the ones that get the best pickup, and now our sales force is pivoting more and more in that direction. That's the way to stay aligned. Steve Mordue: Yeah. You talked about nimble. Frankly, one of the challenges some of these ISVs have is they're not that nimble. They built a bunch of IP on something, and their goal was to just sit back and collect checks, but you can't do that anymore. We're no longer in a space you just build something and sit on it for years. You may not be able to sit on it for months before you've got to go back in, modify, refactor, take advantage of some new technology or... It's a continuous motion now for ISVs. They're in continuous development mode where they didn't use to be. It was like, "We're going to go build something, sit on it, and cash in." Steven Guggenheimer: And particular in this space, and we see it a lot. I use the term, sometimes, there's this notion of lifestyle businesses where you build something and it supports the lifestyle, and there's not a lot of interest or energy in reinvesting to change it or modify it. Truthfully, that doesn't work. There are places where- Steve Mordue: Tell me about it. Steven Guggenheimer: They're- Steve Mordue: That's what I've been trying to do. Steven Guggenheimer: Yeah, it's not working. Part of the blog series I've been working on, it's called Continuous Transformation, and it's all... If you look at 25 years or the 26 years of Microsoft, all we've ever done is evolved and changed, and it's driven by technology and scale and culture. I can't remember a period of time where something's not upending the conversation. Steve Mordue: Yeah, but the pace is much greater in the past few years. The shift to the cloud and the catch up, really, because we were behind getting in the cloud, the catch up necessitated a pace that we have not ever seen from Microsoft, this kind of a pace. Steven Guggenheimer: Yeah. I think, in the line of business application space or the Dynamics/Power Platform, we were further behind in that move, as a Microsoft property, than some of the others, be it Office or Azure, and so we're doing a lot of catch up, and that's why think that... I talked a lot about product truth. I think they've done a phenomenal job, but that's like a bit of a whip where we're as close to it as you can be and, the further out you get, the more you're going to have to go and make those changes, and you're playing a lot of catch up. Steven Guggenheimer: The truth is, D365, there were custom deals floating around there and custom support and all kinds of things that, as you modernize and change, that goes away. I think some [crosstalk 00:12:10]- Steve Mordue: It's not scalable, yeah. Steven Guggenheimer: Well, people get frustrated because they had this special deal. Well, look, we don't even build that product anymore or that product's not one we're trying to sell. We're off doing cloud stuff, so no, we're not going to go renew a set of terms or a set of conditions for something that we're not trying to drive anymore. The market's moved on. That's gone, and so you need to go modify and change your solution to meet the current market needs. Yeah. Steven Guggenheimer: On one hand, I get it. On the other hand, look, the time to move is now. The world is moving, and the opportunity is very good. Despite current conditions which are there, look, there's... The world, the first thing they move is their infrastructure as a service. They move the core horizontal infrastructure out, but sooner or later, the next thing they're going to do is they're going to want to go to a set of SaaS applications. They're not going to want to have a cloud-based infrastructure then run some client server on-premises solution. They're going to want to set a SaaS services. Steven Guggenheimer: Even though people may feel like it's a push or it's a hurry, that's where the world's going. We're going to go push on it, and you need to move your solutions there. Steve Mordue: I'll tell you, it's been very acute, these folks that have on-premise solutions, particularly if they're physically on premise, with this virus and the push to send everybody to work from home in organizations that really weren't set up for people to work from home from a technical standpoint. Steven Guggenheimer: Yeah. Steve Mordue: I'm sure there are people out there now that are thinking, "Damn, I wish we were in the cloud right now because those guys got it pretty easy working from home if you already made this transition." It's very acute right now. Steve Mordue: I was talking to Charles two weeks ago. I pounced on him, or a week ago, I pounced on him for a call. He was saying one of the things that's a- Steven Guggenheimer: You are getting a bit of a reputation, but keep going. Steve Mordue: Yeah. People are going to be scared and have my number blocked. Steven Guggenheimer: Nobody's going to pick up the phone. Steve Mordue: One of the things he said that was a big focus right now is making everything work better. It's like we were firing off lots of solutions, getting them to like 90%, move on to the next one, fire it off, fire it off. Now there's this effort to kind of go back to this. Let's close these gaps. As he was talking about, there's still some significant gaps in not the product truth. The product truth is there, but there's some gaps that they're now really going to focus on closing. It feels like it's kind of like it's time to do that. We've shot out tons of things. Now let's go back, tighten them all up, and then go back to revisit shooting out more things so- Steven Guggenheimer: Yeah, I think that's right. You look for gaps and overlaps. You look for how do we take all the AI scenarios? They're kind of scattered. Can we bring some of them together? Do they make sense together? When they first came into the portfolio, they were sort of all independent, so we ran them uniquely and independently and just kept them going and, excuse me, tried to find alignment with the various SaaS services. Now you go back and you say, okay, where is their consistency? Where is the sum of the parts greater than the individual? Steven Guggenheimer: You go and you look for whether it's process automation and the work we're doing there, whether it's the power of virtual agent. If you look at what they've done in terms of for COVID-19 in terms of using a virtual agent, making it available, how do you turn these into tools that can really scale and operate and work at the levels needed? Steven Guggenheimer: I think Mohamed's got the same thing. There's a bunch of solution areas as we took ERP and CRM and took them into their natural marketing and sales and finance and operations, and we picked up some other areas. He's doing that same work. Now is a beautiful time to not necessarily double the number of offerings or add a whole bunch of new products. It's now is the time to take the momentum we've got and the offerings we've got and fill in the gaps and, where there's overlap, bring things together, make these things really operate at scale. Steven Guggenheimer: When you have the energy and you've got the interest, then what you start to get is feedback on what you're missing or what's not quite right. We want to take advantage of this time to go work on that. Steve Mordue: Let me circle this back to your space, the ISV side specifically. Over the past month, I've had two calls with some folks on your team that were looking for my opinion about some complaints they were getting, because you know I have opinions, about some complaints they were getting from some ISVs that had built their solution depending on this Team Member license and the changes to Team Member. I am actually aware of a couple of these ISVs that actually built their solution on the Team Member license without regard for the restrictions of that license. Certainly pretty easy to make your ISV solution have a lot of appeal if you've put it on a lesser license than it should be on. Steven Guggenheimer: Right. Steve Mordue: They're complaining now about the changes. Both of your folks had asked me my thought about that. I said, basically, "The hell with them." I mean I have no sympathy for somebody who built a solution on top of a license they shouldn't have. If you can't make revenue on the right license, then your solution's not right or you're thing isn't right. I mean do you have similar feelings of lack of sympathy for those folks that did those things? Steven Guggenheimer: I sort of think about it a little bit differently. Yes, look, there's people that take advantage of, it maybe intentionally or unintentionally, of licensing they shouldn't. That just has to get fixed, and we'll go work on that. Steven Guggenheimer: What there is that I think about is there are two scenarios that I think of as light use or light functionality scenarios. If you have something, a very large group of people... Students is a good example. Healthcare workers might be a good example. Pick your scenario where you have lots of people, and you have some people that are heavy users, and you have some people who might touch the solution once or twice a year or who touch the solution quite often, but they need just a very lightweight answer to it. They're not- Steve Mordue: A light touch. Steven Guggenheimer: They're users. They're users versus creators. That lightweight or light touch scenario is one we still are trying to figure out the right scenario for because there's not a great license type for this. By the way, this isn't a Dynamics-type conversation. I can say the same thing for Office for all the years it was there and people would talk about different types of workers. It's one of the- Steve Mordue: Contract workers, things like that. Steven Guggenheimer: Yeah, yeah. They used to use the term knowledge workers, and there was something else I can't remember. There is a collective challenge, which is how do you build a licensing framework where you can't tell between the two, light touch or light use, or you can tell but there's no consistency. If I ask the question, "What does light touch mean to one ISV or light use?" I'll get a very different answer than what I get from another one, so you can't design a licensing type that works for everyone. Steven Guggenheimer: That's one where I definitely have some empathy. It's not a sympathy term. I get it. I don't know what the answer is. To your point, ultimately, you have to design the solution to work with the licensing types that are out there. There's this funny juxtaposition between everybody wants simplicity but everybody wants all ultimate choice. Well, those two things aren't the same. You either get simple or you have the... and not as much choice or you get all the choice in the world. It's the most complex thing you'll ever seen, and so I don't know the answer to solving for this one. Steven Guggenheimer: I know that the licensing teams are very aware of it. They've had tons of these calls, in a good way, but there's not... I don't know the answer. I haven't seen anybody figure out the answer in 10-plus years of banging heads on this, and so I do think trying to design a solution for the licensing types that are out there is the right thing to do. Team doesn't serve that purpose. It's gone relative to that where people try to use it for something that it wasn't designed for, which in many cases, is that light use, light tough scenario, but it doesn't work. Steven Guggenheimer: We'll keep banging our heads. We'll keep talking to people. People do have to work within the licensing confines that are out there. We're always evolving them. We're always taking feedback. We're always trying to do better. Assuming something's going to come magically, it doesn't happen. Steve Mordue: We're not alone there. I was reading the Forrester Report on low-code solutions. We're obviously up there at the top now with a couple of others. The negative for all of the ones at the top was overly complex licensing. I was just thinking to myself, "You know what? Whoever figures that out is going to win because that's the thing holding all of the low-code platforms back a little bit is people can't figure out how to buy it." They just can't. Partners can't figure out what to sell. Customers can't figure out what to buy, too many moving parts in the licensing. Fortunately, we're not the only ones that have that problem, but whoever could figure that out is really... I'm sure you guys have got some smart people trying to figure that out. Steve Mordue: A couple of other things before I let you go. On- Steven Guggenheimer: Well, just on that one, there's also a difference between the customer angle for that and the ISV angle. Trying to figure out a licensing framework that works well for customers and ISVs, whether it's the low-code scenario or some of these others, it adds to the complexity. I highlight that in the sense that customers are a big chunk of... That's typically where we start first when we're working on a licensing framework because they're the... many times are the purchasers or it ends up as part of a broader agreement set, and so we have to figure that out, and so that- Steve Mordue: Actually, I think it's easier for ISVs because, as an ISV, I can figure out and understand what license would be necessary to run my solution and talk to a customer about, "Here's exactly what you need to run my solution." Bigger challenge, I think, for customers and SIs where a customer's like, "We want to do all these wonderful things," and then for them to try and figure out what kind of licenses they might need to accomplish those things. At least I know what I'm doing with my solution. It's pretty straightforward. I may have to shift it from a license I used to have it on to some different licensing construct as things changes, but it's a little easier for me. Steven Guggenheimer: Yeah. Steve Mordue: One of the things that came up in one of my calls with a pretty good size ISV recently was the lack of... I think he told me his costs this year are going to be over $90,000 for Microsoft licensing to be able to actually build and develop their solutions on between their multiple sandboxes, different things like that. It's a frustration for him that, "I'm building an ISV solution, a big one. I have lots of customers that are generating licenses and revenue for Microsoft, but I'm having to spend, as an ISV, a ton of money to even be able to do that." Steve Mordue: We had that ISV competency out for about eight minutes, decided that wasn't a good path. Some of the other paths to get IUR and those sorts of things that you would need to build on aren't always relevant for ISVs. The biggest thing the ISV competency really gave was, "Here. Here's some benefits. Here's some resources for you to go build on." What can we tell those folks that... I mean this guy's literally having to buy retail. You know? Steven Guggenheimer: Yeah. That's a Microsoft-level challenge in many ways. It's the what's the benefits? It really comes out of the MPN, the Microsoft Partner Network. What's the benefits? That's where that competency came from of being a partner and, if you're an ISV, how can you get access to the software you need to build a solution? Steven Guggenheimer: I know that the team is deeply aware of that. It's from the day the ISV competency went away to through all the conversations. I haven't checked in in a while to see where they are on coming up with an offering. I'll go back and ask. It's a good question. I don't know. Look, I don't know the answer, the how do you provide software? It ends up being, to your point, sandboxes or one-offs or these other things versus what's the programmatic approach that scales across Azure, Dynamics/Power Platform at M365? How do we make it available? What do you need to do to qualify, as a partner, so it's not just out there for everybody? It's an expensive offering [crosstalk 00:25:23]- Steve Mordue: Yeah, so is manning an ISV practice with developers and people to build, so- Steven Guggenheimer: Yep. No, they're both... That's right. Steve Mordue: Yep. Steven Guggenheimer: How do we find that balance? I don't know. Again, it's a little bit like a light-usage, lightweight licensing SKU where I haven't seen the answer to that. This is one of those ones that pops up and down in terms of, sometimes, we seem to give a lot of benefit in that direction, and sometimes we don't. Let me go back. I'll go back. It could be one of the last things I can go poke on a little bit, especially since- Steve Mordue: Yeah. That would be good. Steven Guggenheimer: Especially since I know Nick super well. Nick Parker took over the... He has the ISV remit underneath him now, so I'll go bug him about that. Steve Mordue: Yeah, we kind of kicked the can down the road when the ISV competency went away, kind of grandfathered everybody into business biz apps or some other competency while we figured it out, but now we'll be looking at people coming up on that expiring, and they'll be like, "Okay, now what do I got?" I mean it's obviously a big expense for ISVs when they're looking at partnering with Microsoft. They're thinking, "Here's something you can do for me," but other things- Steven Guggenheimer: No, that's super constant, consistent feedback. That's not a new one. We probably had that conversation the first time we did a call and- Steve Mordue: Every time since. Steven Guggenheimer: Every time since, and I still haven't... It's one I get to poke on. It's not one that I own, but it's one that I'll go poke on again. Steve Mordue: How is ISV Connect? Have you guys collected revenue yet? Are we at the point where we're collecting revenue from ISVs? Steven Guggenheimer: Oh, yeah. Yeah, collecting revenue. We crossed 1,000 ISVs that have signed the agreements. I think we've crossed 1,000 apps in AppSource now. We've done all the work to remove the ones that didn't go through certification that didn't join ISV Connect. Steven Guggenheimer: We're actually in a good in a good spot. We've got a decent number at the 20% level, and we're trying to get the ones that our field is really asking for aligned with more of the 20-percenters because those are the ones that are going to close out with the most. I feel really good about the getting people into the program. We've gotten the time to do the certification down. That's all been cleaned up. I think terms and conditions, we've been through all of that. We're heading into the next year. We won't add a lot, so keep it simple, do more of the same. Steven Guggenheimer: The place we're spending energy now is on the benefits side. We've got almost all the partners activated with their marketing benefits now, and they've had the call, and we're working on that. On the co-selling side, look, we're continuing to do the work with the field to drive that forward. Some people feel pretty good about it and we get really good feedback, and some people don't feel as good quite yet, and so we're working on both of those. Steven Guggenheimer: Now as you head into Q4 with an economic challenge around the world, everybody hunkers down a little bit, so we're going to have to work a little harder. One of my meetings later today is how do we stay focused on the right things and the fewest number of things to keep the momentum going as we head into this year and next? We're doing the planning for what would we tune for next year. Overall, it's going well. Steven Guggenheimer: The operations, a lot of the challenges we had, once you got past the people discomfort with a new program, a lot of challenges we had were operations. We're cleaning those up. We have some marketplace work to do. We've had good calls with that team. When people give us feedback, we understand it. We're doing the engineering work now. I sort of feel like we'll work our way through Q4 this year and then, as we head into the next year, we'll have both an engineering uptick on operations work, on the marketplace, on the back end. There's work going on on Partner Center because it's going to scale to more and more partners across the company. Steven Guggenheimer: I feel pretty good, not perfect. I always say these things are a journey and they take time, that's for sure, and so we'll- Steve Mordue: Yeah, yeah. It always takes longer than you think, right? Steven Guggenheimer: Yeah, yeah. I'm scarred enough to know that we still got another year of cranking away, but we're in a good spot given where we were. The energy's in a good place. We just got to keep focused and keep going. Steve Mordue: Yeah. Maybe there's a way to solve both those problems. I seem to recall, at least, the initial benefits that were being, "Here, in exchange for the rev share, we're going to give you guys these benefits." A lot of those benefits were targeting brand-new ISVs. A lot of the benefits on that list for an established ISV, they were like, "Oh, I don't need this. I don't need this. I don't need a bunch of these things as an established ISV." Those are all, certainly, high value to someone brand-new to the platform, which is something we all want is more ISVs. Maybe there's a way to tie in those IURs or the benefits back to, "Okay, you don't want a marketing thing? Fine. How about if we give you some credits that you could use towards the underlying platform stuff you might need that could be a little more value to those folks?" Steven Guggenheimer: That's some of the conversations we're having is which benefits are people finding value in? Where would they like to see other benefits? The IUR is a constant one, so that one I sort of table off on the side because it's a consistent. Steve Mordue: Yeah, yeah. Definitely, benefits will be different for someone brand new to the platform who's never done anything versus someone who's been there for a long time. Let me ask- Steven Guggenheimer: Right. This is one of the trade-offs when you go... A platform is only as strong as its ecosystem. To make the ecosystem stronger, you're going to add more people in, and so you're going to bring people in. Part of what you're trying to do is attract that. Not all of those things feel great for the people that have been there and been working on it. That's where a little bit of the tuning and being agile helps because you're adapting to... Look, the platforms are going to scale and grow. It's in a good spot, so there's going to be more people you know on it, and so we have to find that the tools that work for everyone. Steve Mordue: Yeah. Thanks to your little kick, I got a call next week with about a dozen people on the AppSource team, so they're going to get an earful of all my opinions so they can put that in the mixer. Steven Guggenheimer: No, I think it'll be good because look... and they know. To be honest with you, they know. We told them, "Look, it's better to hear directly. There's a couple of folks, we're having them talk to you. They're sending me the feedback," and then they can tell you where they're at and what they're doing and why it's taking a little longer than maybe people had hoped for. That's the beauty of doing it right and getting it fixed is... not the beauty, the reality. Steve Mordue: Necessity. Steven Guggenheimer: Yeah, the reality or the necessity. It's a little like rebooting this program. Steve Mordue: I want to wrap up here because I don't want to take up too much of your time. Steven Guggenheimer: Yep. Yeah, I got somebody- Steve Mordue: You recently announced a retirement. Steven Guggenheimer: Yep. Steve Mordue: Coming soon. Who's going to be stepping into your shoes for this ISV motion? Figured that out yet? Has that been just thought about? Steven Guggenheimer: Yeah. No, we're going to move the team into another part of the organization. It'll be close to the Accelerator Team, which used to report to me anyway, and the Industry Team and with one of our real good leaders and with DSI. It'll end up in a spot with Greg and Sean still running their teams aligned with the work going on for another key part of the ecosystems, which is SIs, and the industry work, which has a ton of ISV work. It's all the accelerators. Again, that team used to report into my org, so it'll feel like a pretty natural connection into places it would fit and the people we've worked with pretty closely all along. Steve Mordue: You're going to have every single one of these issues fixed, buttoned up, running like a well-oiled machine before you walk out the door, right? Steven Guggenheimer: I'm going to stay committed to doing the best job to make sure we're set up well for our next fiscal year to transitioning well and to being there. Then I'll be around for a little longer to make sure if there's questions or engagements that are needed to done that I do them. Steve Mordue: All right, cool. Well, I'm looking forward to everything that that comes. Thanks for making the time for the call. Steven Guggenheimer: No worries. I always enjoy a surprise call on whatever day it is. Days get lost nowadays, but- Steve Mordue: Yeah. I'll bet you enjoy them, right? Steven Guggenheimer: Yeah. Steve Mordue: All right, man. Have a good one. Steven Guggenheimer: All right. We'll talk you, Steve. Take care. Bye.…
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Steve reads his Blog
1 Tried Dynamics 365? Take another look at Power Apps. 6:39
6:39 Play Later Play Later Lists Like Liked6:39
Play Later Play Later Lists Like LikedAs I think back to past customers of Dynamics 365, not all of them were successful. The challenges that brought them to Dynamics 365 were real enough, but at the time we only had one solution to try and solve them with. I would love to snap my fingers and take Power Apps back in time. Sledgehammers Dynamics 365, borne out of it's predecessor, Dynamics CRM Online, is a software marvel. I'm talking specifically in this post about the "CRM" side of Dynamics 365. For a midsized to large business, D365 has all of the tools you would need to transform your entire operation. XrM was a blessing and a curse. In layperson's terms, XrM was the capability to customize almost any of the significant out-of-the-box capabilities to meet organization specific needs in a highly targeted and relevant way. XrM was also the path utilized to "Extend" D365 to solve other problems not contemplated by the out-of-the-box capabilities. It is a powerful combination that can be brought to bear on almost any business problem. The Curse Over the years, many Dynamics 365 partners became very proficient with XrM. As a result, D365 became a solution to "anything", not just Sales or Service related issues. When your only tool is a hammer, every problem looks like a nail. A customer has a business issue, not related to any of the out-of-the-box capabilities, no problem, we can solve it with XrM! And so it begins, provision an instance, hide most of the out-of-the-box capabilities, and start building custom capabilities. Or, maybe to save some time, we'll re-purpose some of the OOB capabilities, and contort them to fit the requirements, sorta. It's one thing to modify the Opportunity capabilities to better fit a customer's specific Opportunity requirements, even if modified heavily, it's another thing to re-purpose the Opportunity process to solve for Asset Tracking. As a result there are a lot of "bastard" deployments in the wild. Commitment Many well-intentioned partners, offered D365, planning on extensive use of XrM, as a solution to many customers' non-sales or service related problems. Could it solve those problems? Yes! But never as easily, or quickly or cost efficiently as anticipated. Trying to build a custom solution within D365 to a unique problem, is like doing laps in a crowded pool. Your route from start to finish will end up being far from a straight line. For some customers the cure was worse than the problem. All partners have experienced the customer who eventually pulled the plug on the effort. Wouldn't it be nice if there was a way to get the XrM capabilities in an empty pool? Power Apps Over the past couple of years Microsoft has been rolling out Power Apps, now part of the Power Platform. You may have seen it pop up in your Office 365 environments, you may have even played with it. That is really one face of Power Apps. Microsoft, in their infinite wisdom decided to use the same "Power Apps" name for another, completely different, solution. I personally put this at the top of my Dumb Decisions list... but that's another story. The Power Apps you might have seen or used in Office 365 are what are called "Canvas" Power Apps. If you look at a SharePoint list online, for example, you may have seen the Create Power App button, which if clicked, will automatically create a "Canvas" Power App from your list. As a result, a significant number of customers feel they are familiar with Power Apps, I know because I talk to them all the time, but they are only familiar with half of Power Apps, oblivious to the other face of Power Apps. Model-Driven What a shitty product name, or rather qualifier of a product name. Even when I try and explain it to customers, they are confused, because of what they think they already know. Microsoft really botched this one. I know that the plan was that these two completely different things would eventually converge, but giving them both the same name in the meantime was a huge mistake. Customers are thoroughly confused. It's not like Microsoft is afraid to change names, they do it unnecessarily all the time. As I am writing this, they are announcing a name change for "Office 365", a well-known and understood product, to "Microsoft 365", a name that was already in use for something completely different. For a really smart company, they can be quite stupid sometimes. XrM in an Empty Pool Model-Driven Power Apps are the XrM capabilities, in an empty pool. What I would give to go back in time to those customers who pulled the plug on D365. This was the product they actually needed at the time. But... it did not exist, so there's that... maybe I would have just suggested they wait a couple of years. What we have available today is an empty pool, with a low-to-pro code development platform sitting on top of it. We no longer have to waste time and money emptying the pool, or dodging big floats. Time to Value has been slashed. Development costs have been slashed. Time to ROI has been slashed. There's just a hell of a lot of slashing going on. A Big Ask If you are one of those customers, who went down the D365 path and wasted a lot of time and effort, only end up with nothing, I am aware that suggesting you to take a look at something else is a big ask. But, if you still have the problem, Microsoft may have caught up with your needs with Power Apps. Umm.. the other Power Apps.…
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Steve reads his Blog
1 Steve has a third chat with Charles Lamanna 33:52
33:52 Play Later Play Later Lists Like Liked33:52
Play Later Play Later Lists Like LikedI try and sneak up on Charles Lamanna a third time, but he was ready for it, "fool me once". Recently promoted to CVP, Citizen Application Platform I wanted to check in with Charles, who was working from home, about some of the things that are going on. We covered a lot of topics, including the post-virus workplace, RPA, API Limits, Multiplexing and Restricted Entities. Enjoy! Full transcript follows: Charles Lamanna: Hello, it's Charles Lamanna. Steve Mordue: Charles, Steve Mordue. How's it going? Charles Lamanna: Hey Steve. I guess this is being recorded, huh? Steve Mordue: You bet. This is our third time. Have you got some time? Charles Lamanna: I do, always. I have a lot of time locked in my house right now. Steve Mordue: Yeah. It's going to be interesting for people who are listening to this in the future, we are recording this on March 27th 2020. The country is on lockdown and we're still heading upwards, so we don't know where this thing will go or end or what things will look like, but that's where we are now and the whole campus has been basically shut down except for essential people. You're all working from home. Charles Lamanna: Yeah, for a little over three weeks now actually. We did the MVP Summit from home, we did the partner advisory council from home. We even did a virtual offsite where for four days, we all joined a Teams meeting for eight hours each day. Steve Mordue: Oh my God. How are you finding it, compared to going in the office and being with the team. It was massive loss of productivity of your stuff or is it still okay? Charles Lamanna: I'd say there definitely is a slight loss of productivity. It's not as bad as I thought it would be, but I mean, never thought I'd miss my office so much. I really miss just ... you get used to it for a few years, you get everything in place. Steve Mordue: There's a bunch of businesses, I look up my apartment window to downtown Tampa at all these office buildings that are full of law firms and all sorts of people, with bunch of cubicle farms within them with people that could actually be doing their job from anywhere and could have for years and now of course are, and I'm wondering how many of these companies that were reluctant to do remote, that felt like I need to keep eyes on you, by the time we get through this, we'll have figured out how to do it remote. I wonder how many of those remote workers will end up coming back to an office. It could be a huge shift. Charles Lamanna: It definitely will. It's interesting. I was in a talk yesterday and we were talking about how when the original SARS outbreak happened, that actually is what launched eCommerce in APJ, and it's around then this jd.com and Ali basically like mobile ordering took off during that time because people were locked at home and then the rest is history, right? Those are the second largest eCommerce properties out there in the world second only to Amazon. So definitely, I would imagine the way people work and the technology people use will be fundamentally different on the other side of this. Steve Mordue: Well, I'll tell you what, it's almost prescient the way you guys decided to invest deeply in Teams over the past year before any of this was out there. And now looking back, that's looking like really brilliant move. Charles Lamanna: Yeah, there's a lot of impact. A lot of people are in trouble, but it's just, it's so exciting to be able to use something like Teams to do remote learning and tele-health and just video plus chat plus meetings integrated, Teams is really the only one doing that right now and it's just phenomenal for someone working remote or working virtually like us right now. Steve Mordue: You said we did recently go through MVP Summit, which converted into a virtual event at the last minute and it was not horrible for a virtual event first-time scrambled together. But I'm also wondering about events in the future if this may change a lot of events into virtual events even when they don't need to be anymore. But it feels like the technology needs to get one step better on the idea. It wasn't really built for virtual events at scale like that. But it seems like you guys are in a spot to really, you know what, we could figure that out and make a virtual event application actually built specifically for that purpose and potentially get rid of a lot of future ... because I tell you, there's no executive out there that's happy about approving travel expenses for his team to go to some in person event if he could sit at home or sit online, what for? Charles Lamanna: And what's really interesting is, I read Ben Thompson, he has a article called Stratechery and it's one of my favorite things to read and he talks about like is this the end of large conferences? Because when you move to all digital and you realize you get such bigger reach. I mean, you get 100,000 people, no problem. That's almost impossible to do in person and for a fraction of the cost and it can be way more tailored and you don't have to worry about double booking. That's another example where maybe things start to change fundamentally in the future. Steve Mordue: And I think conferences for years have been more about, or at least equally about, the social aspect, seeing people in person going out to the bar after the event, having fun going out to dinner, seeing some town, that sort of thing. And that part of course is probably what causes a lot of people want to go to a conerence and I have guys you and I both know that go to a conference and don't go to any sessions. Guys like myself and Mark Smith, we don't go to any sessions. We just go out there. We do that little things like we had you on and stuff like that just for fun and mainly are out there for the drinking. So we're going to miss it. Charles Lamanna: Yeah. Well I guess, the one thing too is just having a group of 20 ... that's the only thing I've learned for ... like Teams is amazing, like four people, you can have a really good conversation or a big broadcast, but if you want to have a group discussion it's hard. And that's something that works so well because you get all these people together that would never be in the room at the same time in person at these conferences and you can have some really interesting conversations. Steve Mordue: That would be the thing to figure out because in person in like MVP Summit, you guys get up in front of, I don't know, a hundred of us and we're all raising our hand, taking our turns, asking questions until we run you guys off the stage in fear. But now in this virtual, there's no real raise your hand. It's just the loudest person, the one that doesn't stop talking gets to continue until his questions gets out of his mouth and that would be an area that it seems like they could do some improvement. Charles Lamanna: Yeah, and I think [crosstalk 00:06:35] is raise your hand in Teams so you can press the button to raise your hand. I can't wait for that. Steve Mordue: That would be awesome. So you could mute everybody and they'd have to raise their hand and ... well, there you go. That's already heading the direction it would need to because that's what you'd need really for some kind of a virtual conference. Charles Lamanna: Yes. That way also I can just never answer you when you raise your hand. No, I'm just kidding. Steve Mordue: Yeah, exactly. "Oh, it's Steve raising his hand again. We'll just ignore him." Charles Lamanna: Yep. Steve Mordue: A lot of stuff that you guys announced at MVP Summit and of course as everybody knows that's mostly NDA for now so we can't talk about a lot of that stuff, but there's a couple of things that we could talk about. One theme I think I heard, which I wouldn't think is NDA, was this idea of make everything we have work better. And when you guys are building like you've been building at the pace you've been building. It's like somebody threw matches in a box of fireworks at stuff that's coming out. It takes a while for all of those wires to get connected and everything to be singing like you'd want it. And sometimes it's like, you know what, this is working darn good. Let's get this other thing launched and then we get a bunch of stuff that's working darn good but not perfect. So it definitely feels like there's a motion now to let's go back over top of all this awesome stuff we've launched and let's connect those last few wires. Let's get this stuff really working as good as it could work. Is that a fair statement? Charles Lamanna: That's exactly right. And the mantra we keep repeating internally is "end-to-end" because what you'll see is there'll be components that work well individually but they'll just be huge seams or gaps when you try to wire them up together and our whole vision has been that you want to wire these things together. That's why we talk about one Dynamics 365, one power platform. So we have this big focus on making sure scenarios that span applications or expand parts of the platform actually work well end to end and it's going in and wiring those things up and spackling over the creases and putting a new coat of paint on it. It's not fundamental and it's not necessarily something that will pop in a demo or in a keynote, but it'll just make a huge difference for our customers. And we see it already, we track our net promoter score very closely, like what are the makers, end users rate the product as they leverage it, and we just see it as we systematically improve these end-to-end experiences. That net promoter score just keeps going up and up and up and up. Steve Mordue: I know we're a one Microsoft now, which is a nice term, but in reality, these are lots of groups that are focused on their things. You've got the Office group focusing on their things, Biz Apps focusing on theirs, Azure focusing on theirs and you've got within your own group of bag things like VRP and power platform that they're wiring there you're working on and at least that's in your realm. You can make that happen, but then you get Azure AD group go do something out there that messes up something for us, or you talk about a gap, like a gap maybe between something we're doing over here and something's has happened over in the Office side and those are kinds of things that you don't have direct control. You got to try and influence and almost make a case internally to those teams that, hey, this is good or get Sacha to make a case, get somebody to make the case. Charles Lamanna: Yeah, and I think like that is a challenge. As any organization gets bigger you have, like I'd say it's not perfectly well mixed. Kind of like the ocean, right? The ocean is big enough. It's not perfectly well mixed, but I think the fact that it's actually a cultural tenant of Microsoft now to operate in the one Microsoft interest, useful listening and being willing to have the dialogue on is this truly better at the macro level? Is this a global maxima for Microsoft to go do this capability? Even if the things you directly own, it's maybe not a maxima for you and this opens the door to have that dialogue of hey, we need this feature for say the Outlook at [inaudible 00:10:38] so that our Outlook mail app can be better and we can get people off the comm at it. That's an example of a really tight partnership between Outlook and us. Charles Lamanna: And systematically, the Outlook team is completely willing and has shipped feature after feature to go make that Dynamics and Power Apps mail app richer and richer. And just the most recent example is to finally bring delegation to the mail app and that's come over the last three and a half months. So that definitely is a challenge, but it's eminently surmountable and solvable. Steve Mordue: I would imagine there's to some degree of quid pro quo, right? I mean, hey, you guys helped me out with this. I know there's nothing in it for you, but it'll help me. And then when I have an opportunity later to help you guys out. So we're all kind of open arm instead of crossed arms when [inaudible 00:11:27] approaching these other things. So how big is your list of things you owe other people? Charles Lamanna: For Power Apps, I owe a lot. But what's great is a lot of these things aren't like a zero sum in that in order for it to be good for one product or one team at Microsoft has to be bad for the other. The reality is Power Apps inside of Teams, I'll use that as an example. As Power Apps, we're very excited about that because are asking for an integrated experience inside Teams. I want it by my left rail for the app bar or I want it as a tab inside my channel. Those are real customer demands and on the other side, Teams wants to go support as many line of business applications as possible inside Teams. And we all know what's the fastest way to go create a bunch of line of business apps? It's not to go write code is to go use a low-code solution like Power Apps. So you actually can go help accelerate the platform and the line of business awareness and teams and you can go up Power Apps, reach new customers at a broader base just by doing that one feature. Charles Lamanna: So it is a very much win-win situation and adopting that mentality through one Microsoft that really the Microsoft cloud is what customers want and customers want to go trust and transact with Microsoft and not individual product teams. It is just a cultural shift that has really grown under Satya with great success. So I would say, I don't know if a product like Power Apps could have been successful 15 years ago, but it definitely, we have the environment where you can't have something like Power Apps embedded in SharePoint, embedded in Teams, the platform for Dynamics and a standalone business and having that not be dissonance or in conflict. Steve Mordue: It's interesting, I think that the companies that have embraced Teams, and it was frankly a slow go to get people to bite on because it looked a lot different than what they were used to and how they did business. But now the ones that have really gone into it are like, they're maniacal about Teams and Teams is like their new desktop. They're operating in Teams all day long now and like I can't imagine how we ever did anything before Teams. So we're still at that inflection point with Teams where I think there's a huge number of customers yet to discover what a lot of customers have about how transformative that can be. So you had to have Power Apps along for that ride. I think that ride is just getting started. Steve Mordue: It's interesting these times right now, there's an awkwardness about marketing or promoting things that make sense because of a virus. For example, I tactfully tried to write a couple of posts here recently and stood back. I was thinking, does that look opportunistic? But the one was this idea that I'd mentioned earlier, lots of people sending people home to work from home. Well, these companies that have had on-premise systems and still have them been reluctant to move to the cloud, that moved to remote workforce is going to be much more complicated than it would have been for those that had already gone full cloud, people just logging in. They got all the security they need to get. Some of these VPN solutions just were never designed or reinvested enough into to support the entire workforce. What are your thoughts about that? Do you have an opinion on that? Charles Lamanna: Yeah. I think the way we view it is number one, things have changed right now. That's just the reality. People are in different working environments, people are under a different economic pressure. There's very real frontline response necessary to go and combat COVID-19 out in the field. So things have changed. That's number one. And the second thing that we've adopted is because things have changed, we need to be flexible. And if you look across what we've done at Microsoft, even just specifically in the area that I work on, we took the April release or the 2020 wave 1 release. Originally it was going to be mandatory upgrade in April. Talking to a lot of customers, they said, "We can't get the workforce to test it. Please don't do this change, we can't take it." Charles Lamanna: So we extended the opt in window for the wave 1 release to May for an extra month and we'll keep evaluating stuff like that constantly. But we did that and that's a big change for us because we really have trumpeted that clockwork. It's always in April, it's going to come up. But we just felt like that was the right thing to do. Or we've also done a bunch of programs where for six months you can get Power Apps or Dynamics CE free if you're in healthcare, hospitals, life science or government organization because we want to go help. So there's literally dozens and dozens and dozens of state local government, hospitals that we're working with right now inside my team. And we wanted to make sure we could help them in a way where it was clear we were not trying to profiteer off of the crisis. Steve Mordue: It is that fine line though, because obviously there'll be a lot to these folks that'll take you up on those opportunities. And then when all this stuff passes, at some point you guys are going to reach out and say, "Hey, that thing we were giving you for free for so long, we like it back or have you start paying," and it is a fine line about, the super cynics could look at it very cynically I guess. The other thing that is interesting to me, I was talking about how in this time of business, revenue is going to be a challenge for businesses right now. Revenue is going to drop for most businesses that are out there. There'll be certain businesses certainly that will ... in every crisis there's always some businesses that do better than others but most are going to have a little downturn. And their revenue growth is going to be largely out of their control at the moment. And the government could shut down the people that are buying your product or who knows and it's not something you could control like you could before. Steve Mordue: So what you can control though is your costs. That's really all you can control right now. It's the cost side and both those drop to the bottom line the same way, right? Charles Lamanna: Yeah. Steve Mordue: And obviously you laying off people as people are doing that, but it seems like the time for people to really look into their organization for where money is leaking out. Because I look at historically to solve a problem like that, maybe with a business application, we're looking at Dynamics 365 or Salesforce or some big applications, costs a lot of money, a lot of time to get implemented to plug up a leaky ship that's losing some money. Where now with Power Apps, we really had the ability to go, let's identify those leaks. Let's spin up a Power App in a week or two weeks and solve this problem. Steve Mordue: We're doing one right now for a Fortune 500 company that discovered [inaudible 00:18:20] $50,000 a month. And in a big company, you can not notice that. I would notice it, but they didn't notice it until someone suddenly noticed it. We're literally going to plug that hole with a Power App at a total development cost of about 15 grand. And it's just amazing, amazing when you think about how many of those sorts of things and now's a good time for people to really focus on where's money leaking out of your business and there's some lower costs, low-code, quick tools now that could potentially plug those leaks that we didn't even have before. Charles Lamanna: Yeah. And if we look at as a company, we actually view Power Apps and Power Automate together as two products that will be envisioned doing quite well even during an economic downturn for that reason. Because you don't have to hire a very expensive developer to maybe go solve the solution or even if you go work with a services company to implement it, they can implement it much more quickly than they would if they had to go write code. And we're working with I said like a Fortune 100, like very large company just I was talking to this week and they said, well before we were talking about Power Apps all about like transformation. How do we go drive revenue forward and now for the next six months we're going to pivot and we're going to be focused on driving efficiencies in our business process and retiring other IT solutions which overlap and can be replaced with Power Apps. Charles Lamanna: So they're now going to go hunt for like this licensing thing, they pay one million bucks a year. This one, they paid two million bucks a year. Can they just spend a little bit of effort, move that to Power Apps and be able to shut down those licenses once and for all. So that's the benefit of the flexibility of the platform and just the ROI is so clean that we think that there's going to be a lot of opportunity between Power Apps and Power Automate with the new RPA capabilities. Steve Mordue: And talking about RPA in a second, but you did make a point there that it's funny how their original thought was to use it to grow revenue. And because of the situation we're in now, they're looking at another use case, which frankly was just as valid before any virus or anything else was out there. It's interesting that it took something like that to have them say, well what's the other hugely obviously we could solve. Charles Lamanna: Exactly. Steve Mordue: So RPA is an interesting one. There was a lot of talk, a lot of excitement about RPA. And I know that you're probably still somewhat limited on what you can talk about, but whatever you can say, what are you thinking about that? Charles Lamanna: The RPA, we're going to be GA in that with the April wave. So wave 1, just in a week or so. We announced the licensing details for RPA four weeks ago or so I think on March 2nd and what's exciting between the capabilities of it being a true low-code offering like typical power platform offering plus the reasonable licensing options that we have, which are generally like I'd say, the most affordable you're going to find out there for an RPA solution, we think we can actually start to democratize enterprise grade automation. Make it possible to really have business users, IT, pro developers, partners, service companies all use the same platform to go automate and drive efficiencies. So that's the exciting bit, because Power Automate and Flow have been around, Microsoft Flow before that had been around for a while but have really been, I'd say capped to a degree around personal and team and light departmental automation. Charles Lamanna: But now with the RPA functionality, we're starting to see enterprise wide invoice processing, quarterly earnings preparation, accounts, basically resolving receivable accounts, things like that. Very heavy workloads built on top of Power Automate, the same low-code tool has been there for a few years. So we're very excited about it for that reason. And in a world where you want to go trim costs, there's real opportunity to go drive efficiency using Power Automate over time. Steve Mordue: Yep. Definitely. It wouldn't be a talk with me if I didn't bust your balls about some stuff. Charles Lamanna: Let me hear it. What is it about? Steve Mordue: In one of our last calls we talked about the hot topic at the time was about these API limits and you said, this isn't something we want customers to think about. We actually thought of it more as like an asterisk on your cable bill. It shouldn't be a factor. Yet it continues to persist in people's minds. The conversation has not gone away. We've got people claiming that they're running into limits and doing stuff like that. And what are your thoughts around that now that it's actually out there and we're seeing how it's landed in people's organizations. Charles Lamanna: I do still hear a little bit of noise from customers or partners that are running into it. But it is dramatically less because it doesn't impact 99% of customers, it wouldn't impact that 99% of customers. So since it's kind of rolled out, we've heard a lot less noise but there's still does exist some noise. And the thing that we could- Steve Mordue: Would you call it air? Would you just call it a false noise? Because you guys have the analytics in the background, you know what's exactly happening. You know if once you launch this that suddenly half of our customer base is hitting this wall and you know that that's not happening. So is it still the feeling that the ones that are squawking either of that small percentage or just fear mongers? Charles Lamanna: I think there are ... I'd say I'd break down three very valid concerns that we hear. The first is, we don't have enough reporting to make it clear and easy to understand where you stand for the API limits. We have early stage reporting and power platform admin center, but we don't have enough. So there's a lot of improvements coming for that by wave two of this year. So by the end of the next wave, release wave for Dynamics, you'll be able to go in and understand exactly how your API limits are being used and if there's any risk. And that's just going to be exposing telemetry that we ourselves look at today and we think that will help with a lot of the concern that people are facing. So that's one. Charles Lamanna: The second is we have people that are using a lot of the Dynamics products. They're using customer insights, they're using Power Apps, they're using customer engagement, you're using marketing. And their concern is all these application workflows. Like imagine customer insights taking data from CE or marketing doing segmentation on CE are actually generating a lot of API calls. So as they actually keep adding more and more apps, which we like of course, and we think that's the whole special value prop of Dynamics, they are generating a huge amount of API calls. And so this is something we're going back and looking at to see how do we count the application API calls from Microsoft delivered apps and also what API inclusions should come with those other licenses. So that is something we're looking at and we don't have enforcement today so people aren't really feeling the pinch, but people are looking at it and saying, "Hey, I can see that I'm making a lot of API calls because of these other apps." That's the second one. Charles Lamanna: And third thing is we have customers who have a web app or some other service which calls into CPS in the background and that generates a lot of load and that is causing friction. Those are probably the people that we intended to have impact from these changes. And because those are people where maybe they have 10 user licenses but they generate like a billion API calls a day. So that's probably not correct. But we are seeing noise in a few places there. And that last one I think is probably, we're not going to do anything to simplify, whereas the first two are things we're going to go try to simplify and improve over time. Steve Mordue: Couple of other things before I let you go. One is, multiplexing is a concept that's been around for a very, very long time. Back when we had CALS, back when it was a physical app installed on machines and stuff like that. Now we're in this different world with all these cloud apps and services bumping into each other. But multiplexing is still this big gray box for lots of folks. And even in the Microsoft documentation, it's kind of contradictory in some places. What's the story with, we've got Salesforce Connectors, we got SAP Connectors, we've got all these other kinds of connectors that almost seem to be in direct conflict with some of this multiplexing. How do you guys get to figure that out? What does multiplexing going to look like in the future? Charles Lamanna: I would say the spirit of the law when it comes to multiplexing is, if you're doing something to reduce the number of user licenses you'd have to get for users, then you're probably doing multiplexing. And the problem is to convert that to a letter of the law is we create confusion historically to a degree as well as accidentally prevent things that we don't want to prevent based on how the language is written. And I'll give an example. So if I use a connector to say Salesforce or SAP, I still have to be licensed through Power Apps to Salesforce or SAP because you're running with your identity to Salesforce and SAP. So we feel like that's totally aligned with the spirit and those partners feel good with it. Charles Lamanna: One of the places where there was some weirdness was like say I have a Power App connecting to my Dynamics CE data, but I'm not using any of the Dynamics CE logic. Is that multiplexing? Technically four months ago that was multiplexing as the way the licensee guide was written. But that was not the intent and that was not the spirit of the law. So we've gone and changed that actually to say if you're licensed for Power Apps, you're writing a Power App to connect to Dynamics data, but not using the Dynamics app logic or app experience, then that's totally fine and not multiplexing. And that was changed I think in late January, early February because some people pointed out, like this doesn't make sense. And then we said, "You know you're right. That's not where we want to have the impact of that being." So we went and changed it. Charles Lamanna: But at its core, if you're using or doing something to circumvent a user license and you'll know you're doing it because it will feel unnatural because the system's not built to behave that way, that's multiplexing and not allowed. Everything else, the intent is to have it be allowed. Steve Mordue: So if your goal is to game the system, you're multiplexing. Charles Lamanna: Yeah, and you'll know it. If you're like, okay, I'm going to create one system account and people will use a web portal I build in Azure and the system account will then have to fake authorization talking to CDN, you're like in bad territory when you're doing that. Steve Mordue: Yeah. A lot of that comes from customers. Customers are like, "Can't we take a Power App and then have a custom entity that by workflow goes and recreates a record in a restricted entity." I'm like, "No, what are you talking about?" Anything you're doing to try and go around the fence, it's probably going to fall into that funny territory. But- Charles Lamanna: Yeah. And a challenge we always have is, how do we convert these ideas into a digestible licensing guide? And I think it's almost like running a law, like legislating, but there are no judges to actually go interpret the law. Steve Mordue: And we also know that when it's written down in a licensing guide, it almost might as well not be said. If we can't get it technically enforced at various levels, we can point back to the licensing guide. We as partners should be telling customers, "Yep, not allowed to do that." But without technical enforcement, these licensing guides are just something you could beat them over the head with when they misbehave. And speaking of restricted entities, when we last talked, you had mentioned, yep, there may be some more coming. That was a very long time ago and we haven't seen them. Is the thinking still along the lines of that is how we're going to protect some of the first party IP or we maybe have some different thoughts of different ways to protect it in this new world of a common data service, open source, data model, et cetera. Charles Lamanna: We actually do ... we are working on something, I can't quite tip my hand yet, that will better allow you to share data and share schema from the common data model, the common data service in the apps without running into the concept of the restricted entities. So there is something in the works that we're working towards and I would say at a high level, restricted entities as a concept are largely antithetical to our common data service, common data model and vision. And they were just like the least bad option to go make sure that we appropriately can license Dynamics apps. So we are working feverously on many proposals to get out of that restricted entity business, but still have a model which more appropriately captures and protects the value of the Dynamics apps without introducing restricted entities. So there, I'd say stay tuned. There definitely the best minds are working on it and I've seen a very digestible and good proposal that is running up the chain right now and that'll get us in a much better place later this year. Steve Mordue: I had that assumption since you talked about adding some and so much time had gone by and my thinking was, because I never liked the idea of the restricted entities for reasons you just said. It felt like a quick down and dirty temporary solution and I had the assumption that since we hadn't heard any more that you guys were actually coming up with a better idea. So very glad to hear that. I'm sure everybody would be glad to hear that. So I know you got to get back to work. You're a busy guy. Anything else you want to convey to folks out there right now? Charles Lamanna: The biggest go do I'd have for folks right now at this point in time, it would be go play with Power Automate, learn the new RPA functionality. It's a huge addition to dynamic CE. It's a great thing for support and customer service workloads. It's a great thing for finance workloads. Like we have one customer that went from 22 finance ops people down to three just using Power Automate and RPA. Plus if you use Power Apps, it's a great way to go extend it. So I say go give Power Automate and RPA a try. That is the number one thing I think to pay attention to and that's the number one thing we're going to be talking about at the virtual launch event. That would be my call to action. That'd be the one thing I'd say. And the second thing would be, I even wore short thinking Steve would maybe video call me today, but it's too bad you can't see it. Steve Mordue: That's very nice. Charles Lamanna: But maybe I take a picture and send it to you about a merry pigmas. So that's the current state here is I work from home, but I say- Steve Mordue: We're all letting the hair grow and- Charles Lamanna: Yeah, I had a call with our PR and AR folks, our analyst relations folks because I had an interview on Wednesday and they said, "You're going to shave, right? You're going to shave before you get on the camera with him." So yeah. But anyway, exciting times. As always, pleasure. Steve Mordue: Listen, you never have to shave to talk to me. Charles Lamanna: Awesome. Thank you. I appreciate that. Steve Mordue: All right Charles, thanks for the time. Charles Lamanna: Yeah, always good to chat with you, Steve. Have a good weekend. Stay safe.…
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Steve reads his Blog
Most people I am talking to today are starting to think about their businesses in these odd times. Many are naturally concerned about a reduction in revenue. But the counter-part to revenue is cost. Since the revenue side may be out of our control to some degree, the cost side is more critical than ever. Athletic I work with a lot of businesses of all sizes. From my first-hand experience, the smaller the business, the leaner they operate. That is not a result of smaller profit percentage, many have very high margins. The biggest difference is that from the smaller business owner's perch, they can see better. There is not much that is missed in a small a business. As businesses grow, layers are introduced that start to obscure visibility. Undetected leaks start to form... leaks that can be hidden by high margins. BBW At the opposite end of the scale are large businesses. While their margins may be smaller, their volume is huge, and of course their costs are also huge. Well beyond the scale that a single person can have any visibility; with layers upon layers, there are leaks all over the place. We are working with a Fortune 500 customer right now that discovered a $250K/month leak that had been unnoticed for quite a while. The solution was not complicated, we are plugging the hole with a Power App at a total cost of about $15K. Of course since this was a big ass company, it took 4 months to approve the expense, and about 90 days more so far, to mobilize their side. This leak could have been plugged in two weeks, but instead another $1.5m will have leaked out first. Such is the ineptitude of large business, this could never happen in a smaller business. A Few Extra Pounds Sitting in the middle, between small and large businesses, are the midsized businesses. While a $250k/month leak will not go unnoticed for a second, the midsized business has enough layers to have many leaks. Where are these leaks? Usually some faulty, or inefficient business process. What kind of leaks? Time not captured properly, customers not billed properly, vendors not paid properly, inventory not managed properly, inefficient project management or production line management... leaks are potentially all over. Every business has leaks, some are significant enough to warrant immediate attention, and others are just considered a "cost of business", absorbed by margin. But if margins compress, every leak will start looking pretty important. Plugging Leaks Depending on the leak, you may need to use a different set of tools, but many of these leaks will be occurring in your business processes. Microsoft's Power Platform is the tool to use for those. Unlike Salesforce.com or even Dynamics 365, both of which require significant time and cost to implement, the Power Platform can solve many business process issues in days. Built on top of the Common Data Service, the Power Platform includes a suite of tools including Power Apps, Power Automate, Power BI and Power Virtual Agents. Each of these tools are low-code options that can be deployed quickly, and at a low cost, to plug leaks. If you would like to learn how you can plug leaks with the Power Platform, we offer a free briefing to get you up-to-speed. Go to Appsource.com and search "forceworks".…
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Steve reads his Blog
The Conona Virus is having many different effects on the world, most are negative, but there are some that may actually be positive. For example, with workers being asked to work from home at an unprecedented rate, and that will no doubt go higher, one major point of failure will be on-premise based solutions. Let's unpack this. Remote Workers Looking from the balcony of my downtown apartment, my view is dominated by office buildings. They are full of financial services firms, law firms... professional services firms of all kinds. Most of these office spaces consist of executive offices, conference rooms, kitchens and cubicle farms. With the exception of decor choices, they are all very similar. Recent events have lead many of these firms to voluntarily, yet reluctantly, allow many of the people who work in these spaces to work from home... "temporarily". It does seem like an unnecessary risk to pack all of those people in elevators a few times a day, just so they can sit in their cubes. In many places this has already been mandated, and the list of those places will continue to grow. I see a couple of eventual outcomes from this. First, many companies who believed that virtual workers was not an option for their business, will realize that they were wrong. Over time, they will adapt to remote workers and become efficient out of necessity. In the meantime, they will continue making expensive office lease payments for unused space, shining a bright light on that recurring cost. When current events pass, I foresee many companies will continue with the remote worker concept. Now is probably not a good time to invest in Class-A Office Space. First-Mover Advantage For those companies who had previously transitioned to cloud based productivity and business solutions, this move to a remote workforce will be much simpler. But for those companies with on-premise infrastructure, there will be challenges. Even those who had VPN solutions in-place, for occasional remote access, will find their systems woefully inadequate for full time use by the majority of their people. In addition, their IT staff will be overwhelmed by the new demands. I expect there to be shortages of VPN related hardware and equipment as companies frantically try to upfit to meet these new requirements. In addition, security and compliance requirements are not going to be waived. This will be particularly acute for those whose on-premise systems are actually on their premises. What happens when their physical access to their server rooms becomes limited? Their peers who previously made the transition to cloud are going to look as smart, as they are going to look stupid. There will be some Monday-morning quarterbacking going on. The credibility of IT will be in question, as their past reluctance to move to the cloud, will suddenly become a huge issue for their business. In some cases, some may be unable to even work properly and compete, in a time when it is the most important to be able to do so. Cloud is the new Toilet Paper We are already seeing the wave. Every customer who had been talking to us about moving to the cloud, is now wanting to execute on that immediately. Some out of necessity because of reasons I explained above, and others who are seeing this as a good time to make a disruptive move, like migrations, and be prepared when current events pass. In addition to the move to a remote workforce, few businesses will avoid a general slowdown. For those who had been hesitant to move to the cloud while their businesses were operating at full capacity, some are seeing this as as good a time as there has ever been, and hopefully ever will be again, to make that kind of transition. All cloud providers and their dependent service companies are going to be very busy for a while. Capacity is going to be an issue. Not for the cloud services, they were built for future scale and are licking their chops at what is about to happen. But the capacity of the supporting companies, who do the actual migrations and implementations for end customers to utilize these cloud services, will be strained. The backlog is growing and is about to become very long. We Hate to say we told you so I have been talking to IT about cloud for almost two decades now. In the early days their fears were quite legitimate. But today, I find a few common reasons for not wanting to make the move. Number one is unspoken: job preservation. Many in IT have no concept of the cloud, had they moved earlier they could have been cloud experts, but they didn't, and now there are many cloud experts. They could rightly lose their job in a move to the cloud and be replaced by a "cloud expert". They missed that window. This "Number One" reason, has lead to many other supporting excuses. Compliance, Security, etc., all of which had been overcome for quite a while now. Cost is another one. If they have not realized their full ROI on previous hardware and software expenses, there's a financially legit reason. Of course it ignores the benefits of cloud over on-premise, and focuses solely on capturing their investment in outdated technology, something that I don't think is even possible. I don't really feel bad for these people. they intentionally held their organizations back for their own selfish reasons... they should have been fired. However, there are many IT pros that have been proponents of a move to the cloud, but were over-ruled by management or bean-counters. Now they, as well as I, get to say "We told you so!" Is it too late? My first thought is that it will never be to late, but I could be wrong. The situation is fluid and changing rapidly, what comes after mandating that your workforce has to work from home? Maybe padlocks on the doors, maybe shutting power to unoccupied floors. where your servers may sit. Who knows? Am I being alarmist or opportunist? Maybe, but it does not mean I'm wrong. I'm just making an observation based on observed activity of our own. Regardless, moving to the cloud was a good idea before this, so it still is, and possibly a hugely good idea now. Microsoft and it's partners are in a unique position given today's issues, based on decisions that had been made before this situation was even contemplated. The phrase "Right place - right time" feels appropriate. Over recent years the partners who specialize in Office 365, have gotten migration down to a pretty painless process. The partners who specialize in Azure, move on-premise servers to VMs in their sleep. The partners like us, who specialize in Business Applications like Dynamics 365, have also done our share of migrations. We even offer a free On-premise to Online Migration Briefing to explain the process. Go to appsource.com and search "forceworks". I am sure that there will be some that may feel that my pointing all this out, at a time of tragedy for many, is insensitive. But the reality is that business must continue, or what will be left on the other side?…
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You were warned, you panicked, then realized nothing was happening immediately. So the trusty Team Member licenses kept chugging along, continuing to perform well beyond their boundaries. I wrote about this day coming back in May of 2018, and now finally, it's just around the corner.... prepare for the panic. Sum it up In a nutshell, if you bought Team Member licenses after October 1st of 2018, this applies to you immediately. If you have older Team Member licenses, I'm sure you will have to replace those on an upcoming renewal. Microsoft has released, as part of early access, three new apps: Customer Service Team Member, Sales Team Member and Project Resource Hub. Microsoft first announced last week in an email to Admins that as of April 1st (yes, this upcoming April) your Team Member licensed users will only be able to access these apps, and no other apps, including any custom apps. They since updated the announcement this week, that for existing instances that would be impacted by this change, you will get a 90 day grace period. These changes mean that "some" of the restrictions will no longer be enforced just with paper, but rather technically, meaning you can't ignore it and just keep chugging any more. What are these Apps? For those of you who never paid any attention to the paper limitations of the Team Member licenses, these apps are the real-life manifestation of those limits. A Team Member licensed user, can do whatever they are able to do within one of these apps, as delivered, without the fear of being out of compliance. That's good news for those who are concerned with keeping in compliance. However, it will be a shock for those who have been using Team Member as a full access rights level license. The invisible lines will rise to 20 foot concrete walls on 04/01, or 6/30 for existing. But, the concrete is porous, because these apps are also customizable. Does that mean you could potentially customize these apps to take you right back out of bounds? At the moment, it does. But this is just the first phase of the full enforcement plan, so you would be doing so at your own risk... again. Phase One Microsoft started with the low-hanging fruit, because you have to start somewhere. They figured out how to technically limit the apps available by license. So your Team Member licensed users will only see these new apps.... they will no longer see the first-party, or any custom apps. Theoretically, this should help keep them "in bounds". They also figured out how to technically limit the maximum number of entities that an app can have. Jukka recently pointed out, that since a right of Team Member is "Read" access to everything, does not the 15 entity limit for these apps obstruct that right? I think if I were Microsoft I would say the answer is "no". You pick the 15, and they can be from anything. So they still have rights to "read" everything... just not all at once. What Might Phase Two look Like? For the sneaky people, this "handicapped", but did not fully eliminate the issue... since these apps are customizable, I can still modify one of these apps to put me out of bounds. I expect the next phase, now that Microsoft has realized that "paper" is not worth the paper it's printed on, will be to add the layer that will technically limit the privileges to match those of the license. That is going to be a much bigger undertaking. How about another idea? Scrap it? The Team Member license was necessary to gain market share at the time, but ended up costing Microsoft a lot of potential revenue. Of course, that was potential revenue they would have never captured anyway without the team member license.... so it's a catch-22. Launching it with Technical enforcement from the jump would have prevented the problem, but there was no time for that then, we're in a feature race with the rest of the world! However, since the time Team Member was launched, we have some new options today, namely Power Apps. Team Member vs. Power Apps I have several customers asking me about switching to Power Apps instead of Team Member, particularly the $10 App Passes, since the cost is similar. This is a thought, but it is certainly not a direct swap, there are several caveats. Whereas the Team member Apps will have a limit of 15 entities, a Power App has no such limit. However a Power Apps cannot use "Restricted" entities without triggering a full price license, and Team member does not have a concept of "Restricted entities". You can freely "create" new Account records in a Power App, but that is not allowed with the Team member license. These are a few of the differences to understand, and there are more. What they have in common, is that they can both access the same CDS via an app, their "rights" differ, but it is definitely an option worth exploring. Who cares about any of this? I have been pretty consistent in my lack of empathy for the knowing violators, I hate cheaters. However, I am concerned about the unknowing violators, those who were oblivious to Microsoft's invisible lines. I foresee many of these customers not even getting this messaging now, making no preparations at all, and on June 30th they smash into the 20 foot wall. WTF? ISVs? I am aware of a few ISVs who have also taken advantage of the Team Member licenses. I have been an advocate for ISVs to think about building their solutions on the least expensive license that is "necessary". Some have instead built on the least expensive license that is "available". After 04/01 or 06/30, Team Members will not even be able to access these ISV apps. I actually see a couple of them collapsing as a result. Do I have empathy for them? Nope, they knew what they were doing... but again, their customers didn't. A Culling A hand-full of ISVs and some customers will be lost as a result of this motion. The economics of compliance will outweigh their current benefits of the platform. Many of these people will be looking at a roughly 8X license cost increase to continue doing what they have been doing. Without taking advantage of much more of the platform's capabilities, they will probably migrate away. That will be a rude awakening. When they have been using enterprise capabilities, for less than $10 a month, their low-cost alternatives are going to look pretty weak. But the "free-ride" is coming to an end, ready or not.…
There are a couple of different ways to approach building a Power App... and I am not referring to Canvas vs. Model-Driven here, but rather, the environment type. Today, you can build a Power App on either a "vanilla" CDS environment, or on a Dynamics 365 CDS environment. Why does it matter? Vanilla Let's quickly discuss the Vanilla approach as it is the safest, which I will explain why later. If you log into the Power Platform Admin Center you will be presented with a list of Environments that you have in place. If you have Dynamics 365, any of those environments will also be listed, otherwise these will all be what I call "Vanilla" environments. Clicking on the + New button, will start you on a path of creating yet another Vanilla Environment. If all you have is Power Apps licensing, then all of your environments will be Vanilla. What is Vanilla? A Vanilla CDS Environment will contain a basic data model, including Contacts, Accounts and few other items. It is meant to be extended by you to meet your needs for a Power App you want to create. It is a perfect solution for moving a Speadsheet based process into a "real" app. Or for possibly replacing some basic point solutions. But what if you also have Dynamics 365, and want to build a specific limited purpose app using the data that resides in that Environment? Apps on D365 Dynamics 365 CRM apps are basically just great big Power Apps. You could build your own app, to do something particular for a certain set of users, and it would appear in the App list, right next to Enterprise Sales for example. Why might you consider this? Let's take an example of a part of your business that uses Dynamics 365. Let's say this department uses the Contacts and Accounts entities, but it also uses a few custom entities that you created for some specific purpose. One reason to consider building a Power App is that you can create a highly targeted application just for those users, that includes only what they need, and nothing more. Another reason is that you could potentially reduce your licensing costs... significantly. License Tightrope When you build a Power App on top of a Dynamics 365 environment, you have access to all of the entities in that environment, including of course any custom ones you created. If you were to pull into your app Contacts and Accounts and your custom entities, you are potentially creating an app that could run on a $10 App Pass instead of a full user license. But if you also decided to pull in the Case entity, for example, you would see a message that this entity is restricted. You can still use it, and it may still make sense to create a targeted app for some purpose, but you will not be able to use the lower cost licenses for these users. Restricted Entities Some of the entities that are in a Dynamics 365 environment are "Restricted", there is a list of them here . Why are they restricted? Microsoft has given you the ability to build a Model-Driven Power App, ostensibly, to build simple apps. However, there is no limit on how complex your app can become, it is only limited by your knowledge and ability. With a much lower cost, many are taking a hard look at how they are using the Dynamics 365 apps, and some are opting to just build their own "Sales" app for example. Not only can they eliminate all of the features they are not using with a skinnier app, but they could potentially reduce their license costs, as long as you avoid the Restricted entity trapdoors. More Restricted Entities Coming... eventually Microsoft announced in October, and Charles Lamanna confirmed publicly on my podcast in September, that more entities will be tagged as restricted. But as of today, we still don't know which ones. Meaning we have been building within the boundaries, but at some point the boundary will be moved. That will not be a good day, if something that we used, suddenly gets tagged as "restricted". Why Restricted? Microsoft needs to protect their first-party app revenue, this is understood and reasonable. If I had P&L responsibility for one of the first-party apps, I would be concerned about Power Apps cannibalizing some of my users. But restricting access to a few random entities is a bad way to approach that. Previously there was a rule that you could not "replicate the functionality" of the first-party apps, but they removed that rule so Power Apps would not die a quick death. So, while I can't use a restricted entity in my app without triggering a higher license cost, I am free to build my own custom entity, right next to the restricted one and use that. So is this the perfect solution? Well, that depends on the trajectory of the customer. If at some point in the future they want to move to the full first-party apps, and have been using a custom entity for some OOB feature, they will have to migrate data. Or, if they have a mix of users, some on first-party and some on a Power App, this would also be problematic. So the restricting of entities does not protect the first-party apps, it just creates future frustration for customers. A Better Idea? As I was writing this post, a fellow long-time MVP floated the same idea I was planning to write here. Basically the value of the first-party apps is not in the data model, as I said I am free to replicate that, and it is not even hard to do. Protecting an app by creating a potential "pain in the ass" scenario in the future is not a good idea, as most customers will not realize that until later. The real value of the first party apps is in the logic layer, not the data model. In particular where Microsoft has made some proprietary logic part of their app. Also, app specific features like plugins, or behind the scenes processes like Lead qualification, or SLA management. These are things that are not only valuable, but more difficult to replicate. If I were able to use a restricted entity, like Case for example, I would have no reason to create my own. If at some point that customer wanted to move up to the full Customer Service app, it would be a simple license swapping process, instead they may consider staying put, if the hassle is too high. This would be the opposite of what Microsoft's first-party teams would like to see happen. I have customers in that very predicament right now. Restricting entities was a down-and-dirty, lazy way to solve this problem. Hopefully Microsoft will come up with a better approach soon.…
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As an ISV I want to be able to take full advantage of everything that Microsoft's Power Platform can offer. Like SI's and customers, I get excited when I see the roadmap of features that are coming... it is mind-boggling. Unfortunately, just because something goes GA, does not mean it is "ISV Ready". ISV Connect Technical Summit I recently attended the least "technical", technical event I have ever been to. As part of Microsoft's larger "ISV Connect" effort to create excitement for ISVs, they had extended what had previously been a smaller F&O ISV focused event to encompass all of Dynamics 365 and the Power Platform. I missed the follow-up email suggesting that I send my technical people, and instead went myself. Cave Dwellers It seems that this majority F&O crowd, did send their technical people, who apparently all live under rocks. Many of the sessions were about things like "What is CDS?" Content I had already seen 100 times. What I found interesting, was that this far into the game, so many people still did not understand what we have all been talking about for the last two+ years. Twists and Turns I have seen the Power Platform slides many times, but these had been updated to include "Power Virtual Agents" in the mix. To be honest, I don't think Power Virtual Agents should sit at the same level as Power Apps, Power Automate and Power BI. It feels like the dwarf on the basketball team. If I were in charge, I would probably have renamed "Dynamics 365 Customer Insights" to "Power Insights" and given it the upper level. As a standalone product, similar to Power Apps, Power Automate and Power BI, Dynamics 365 Customer Insights does not even require Dynamics 365. Ironically, I had predicted a while back that "Dynamics 365" would eventually become the brand name for Microsoft's "finished" apps that run on the Power Platform, which is the reason I was given for this naming. But it is not that dissimilar a level of "finished" than Power BI, and we don't call that Dynamics 365 BI. Burned by GA With my ISV hat on, I have become suspicious of the GA tag. Microsoft should really clarify that a feature or product is "GA for SIs and Customers", but not ready yet for ISVs. What's the difference? Well, as an ISV, who is drinking the AppSource Koolaid, I have to look at it differently. In an ideal world, my customer can go to AppSource, click a button to install my solution, and just use it. For the most part, this turnkey dream only works for Model-Driven apps today. ISV Ready Tag In one of the session Q&As, I asked one of the Microsoft ISV leaders about the possibility of an "ISV Ready" tag. He said "Good Idea!", which I have heard many times with no subsequent action. But he was actually all over the idea, including creating a slide for his closing session about the "ISV Ready" tag, I had previously caught him in the hallway and suggested the ISV Ready tag should not be applied by the product teams, but rather by a volunteer committee of actual ISVs.... because we actually know when something is "Ready" for us. What is ISV Ready? Well, since Microsoft seems to be running with the idea, I guess we will eventually find out what they think it means. I also think it will vary from ISV to ISV. Many ISVs have an intentional services component that comes behind their IP, to perform various tasks and configurations. For me, I want turnkey. I don't want to have to get on the phone with every customer, or create some complicated instructions, for them to be able to use my solutions. It's more than just being "Solution Aware", although that is obviously part of it. I mean Power Automate is now "Solution Aware", but is not "ISV Ready" in my opinion. I recently installed Microsoft's own Center of Excellence Starter Kit solution on an instance, and then spent half a day manually connecting all of the included Flows to make it light up. I can't expect a customer to do that, as soon as it does not work as advertised, they'll just delete my solution. Customers First I get that Microsoft is going to build things that solve issues for customers first, and I am not suggesting that they hold off on GAing things until they are ISV Ready. But don't think that feature is truly done, and move on the next shiny object, until it is ISV Ready. This assumes of course that Microsoft is sincere in their desire to grown a thriving ISV ecosystem like SFDC. At the moment, I believe they are sincere, but as my ex wife used to say to me, "Actions speak louder than words".…
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I know had previously written about Partner business models, but I can't find that post. I recall discussing our "Blocks of Hours" model, and how it was working well for both us and our customers. But I was seeing some cracks in it, and decided to create yet another business model, that we are starting to use now, that shows even better potential. What is a Business Model? At some point in talking with a customer about how awesome you and your team are, and hearing about what they are hoping to accomplish, they will ask "So how do we engage with you?" They will have to ask, because we all have our own ways of working with customers. I have tried them all, and don't like most of them. Each one that is in common use today has it's "fatal flaw", maybe for you, maybe for the customer, or sometimes both. Let's review a couple for fun. Fixed Scope-Fixed Price Most customers think that this is the model they want. How can they get budget approval without a fixed cost? This is particularly acute with Government or Large Enterprise customers. You could answer with a range... it could be as low as $x, or as high as 2 x $x. Which number do they go to management and ask for? In our business, the fixed-scope will not survive the first kick-off phone call anyway. Since the time you developed the requirements, Microsoft launched three more applicable features. Fixed Scope-Fixed Price is the most antagonistic model there ever was. It literally turns the engagement into a battleground from the jump. It does not work for either side, so we'll toss that one in the toilet. Value Based Pricing The idea here is to abstract away the actual effort required, and price things according to what their value is to the customer. This one is completely partner-centric, basically charging normal costs for normal things, but hammering the customer for the shit they really want. This model assumes that customers are morons... this one ends badly. Time and Materials This one seems pretty safe for the partner, although upside is limited. No scope, no price, we just put our heads down and start working. At some point we look up to a customer who is saying "What the fuck have you been doing?", "Oh, you know, just bopping along." No structure, goals, plan, or timeframe. This one usually comes to an abrupt end, with no finished work. A Little Better Model Several years ago we went to a "Blocks of Time" model. Customers could purchase blocks of time in increments of 10, 20, 40 or 80 hours. These were pre-paid, so it eliminated any chasing money on our part. It was a blended rate that covered anything they wanted to do, and unused time expired after six months. It was similar to a regular T&M model, but was promoted as more of a modified Agile approach. What I did not like about it was the lack of accountability, on both sides. 40 hours is basically one week of one person, but with six months to use the time, nobody was in any particular hurry. It would not be unusual for a customer to go quiet for weeks, and then come back all fired up to resume. In the meantime, we re-assigned people, forgot where we were on their project, and it was just not as efficient as it could be. The upside was the most the customer could buy was 80 hours at a time, which meant we both had the opportunity to end the engagement whenever a block was consumed. It was a pretty good model, but I saw room to improve it. PowerSprints I liked the idea of "blocks", but it was lacking the urgency and accountability on both sides to actually get shit built... quickly. Time is the killer... endless projects that meander around are not good for anybody. I originally started thinking about time-boxing the blocks, getting away from the six months and tightening that up... a lot. I ended up with this idea that I'm call "PowerSprints" (Neil Benson is shaking his head at this moment). Basically, a PowerSprint is one week of effort by a team. I have small, medium and large PowerSprints, while each is one week in duration, their size will determine the velocity as they have progressively larger teams. An engagement starts with a required PowerSprint Zero (5 Man-days). I stopped providing free consulting, under the guise of "Pre-Sales", years ago. We use this week to perform any analysis, setup environments, pre-requisites, etc, and conclude with an initial backlog for the first PowerSprint. We will also create a high level schedule of time and sprint sizes, which can vary from week to week depending on what needs to be done. This schedule will be a range of "Best Case" with up to a 100% contingency, in case all hell breaks loose. We will mutually agree with the client on which week a PowerSprint will begin. They need to be ready for continuous communication and daily deliverables, and we need to be ready to execute. The PowerSprint begins on a Monday morning, and is continuous effort and deliverables until Friday afternoon... and it's done. What got done? As much of the prioritized backlog as possible based on the team size. This is what you call "Not Fucking around". A small project may only require one Small PowerSprint... but it's done in one week. A large project may require several successive sprints, and potentially some off weeks to all catch our breath. What do I like about this model? Well, as long as everybody is on-board, focused and ready... this is a "Shit gets done fast" model. What are the possible drawbacks? There are a couple of risks. On our side we have to have a team in place, focused and ready. A Team typically consists of a B/A who can also do configuration, an Architect, an Account Manager, a Developer and a Q/A person. The make-up of the team is flexible depending on the sprint backlog, as long as it adds up to the same man-days. For the customer, the risk is that they think they are ready to hold up their end, and then are unable to for some reason. Once a PowerSprint starts, it does not wait for anybody, and ends on Friday, ready or not that PowerSprint was consumed. If the customer is unable to engage, they will get our interpretation of the backlog. So we are starting to use this model, and having good results, I would love to hear others' opinions.…
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The IT organization, inside of most enterprise customers, is primarily focused on Security, Governance and Compliance these days. One of the biggest tools in their arsenal is the word "No". That approach, to requests from various departments for solutions to help them accomplish their goals, planted the seeds for Shadow IT, and that Genie is not going back in the bottle. Shadow IT In every organization, that is of a size to have an actual IT Department, Shadow IT exists. If you work or run one of these departments, and think there is no Shadow IT in your organization... you are wrong. There are tens of thousands of pay-by-credit-card online services available, to solve just about the same number of problems that people in your organization are struggling with. When you said "No" to Sally, and her 5-person department, for some kind of a solution they could use to track their projects, Sally signed up for "Billy-Bobs Project Whiz", a SaaS service, that she put on her credit card and adds to her expense reimbursement request. Studies A Plenty Clearly the "Democratization of IT" is bringing it's challenges to IT. There have been many studies over the years about the potential impact of Shadow IT, I pulled a few interesting tidbits from this Forbes one from late last year, where they surveyed 350 Enterprise Execs. "60% of organizations don't include Shadow IT in their threat assessments." I'll call this the "putting your head in the sand" approach. Yet "46% say Shadow IT makes it impossible to protect their data." So we are aware... we just choose to ignore it. When asked who should be responsible for a security issue from unsanctioned apps, 87% said the users themselves! So Sally unknowingly connects "Billy Bob's Project Whiz" to sensitive data, that is then exposed and brings the whole company to a stop... but it's Sally who is responsible? 68% said it was the IT Department's responsibly for software that they are not even aware of, not causing a problem! Another 64% said it was Billy Bob's responsibility! Less than half of the Execs believed they were even aware of the extent of Shadow IT. My guess is, that the ones who claimed they were aware, don't know the depth of it. There are more scary facts in that study, as well as the many other studies out there. Battle Tactics Up until now, the typical tactics used by IT to curtail Shadow IT have been lockdown measures, including elaborate data access policies, Zero-Trust policies, encryption, etc. Basically removing access to the most valuable resources from the people who need access. How are Line-of-business owners supposed to advance their organizational goals, without access to the very data they need to accomplish that? Obviously you can't just open up your data stores to every "Billy Bob" SaaS service... but your users need it. Embrace It? If it's going to happen anyway, is it better to just embrace it, and attempt to govern this Shadow activity? This would require a significant change in IT's thinking. "Hey Sally, I know I said 'no' to your request last year, but I assume you have solved your issue another way, can I take a peek at that please?" Certainly you could review "Billy Bob's" app, and maybe realize that Sally, not being a knowledgeable person, could have checked a box to encrypt all data, or similar things. Maybe you could even get satisfied that "Billy Bob's" App does not present a threat. What's next? Find every app like that in use your organization? How could you even do that? And checking them all would become a year-long project. For the ones that don't pass your review, how would you stop them from using it anyway... I mean they already went around you. Asking "Nicely"? That's not a trait of IT. What are these Apps? Most of the Shadow IT Apps in your organization will be some kind of point solutions to solve specific business challenges for your users. Many of these "Apps" will be brought in by the department to replace spreadsheet based systems that are just not cutting it for them anymore. Maybe you could track your users' Excel usage... if it suddenly goes down, you may have a new Shadow App in your org. Here's the problem, if you keep saying "No" to requests for help, they are going to solve their problem another way. But if you start saying "Yes", you now have a full-time job of vetting and monitoring all these "Billy Bob" apps. Microsoft's Power Platform Ok, I am aware that as a Microsoft Partner, I have my bias, but that does not mean that they haven't created a path for you to solve this problem. The Power Platform, which includes Power Apps, Power Automate, Power BI and Power Virtual Agents, was purposely designed to be used by your line-of-business users to build applications, using no/low code, to solve many of the problems they are going outside for. But are you just trading one problem for another? Again, saying "No" means Power Platform is just one more place your users can go with a credit card and sign up for on their own. Or you could bring it into your organization yourself and give them access to it. Why? Well now it is running in your environments that you control, and access to all of it is via Active Directory. The ultimate in security is their login page to your Microsoft account. So does the Power Platform solve your Shadow IT problem? Hell no. Internal Shadows Microsoft made a recent decision to turn on the ability for your users to create their own apps "by default". I guess they thought you would get in the way. Yes, if you have Office 365, your users can start building apps, and many may have already. Sure, you have a master kill switch, but that would just drive them back outside. Based on Microsoft information, users are building thousands of apps right now on the Power Platform... because they can. Using connectors, these users can be sending your data outside of your organization right now. So the Power Platform alone does not solve your problem, it could even be making it worse! How can you figure out the extent? I guess you could hit the kill switch and see how many screams you hear. Is there a better way? Center of Excellence (CoE) Fully cognizant of the potential of the Power Platform to transform an organization, but at the same time drive IT nuts, Microsoft developed an alternative to the kill switch they desperately hope you won't push. Since pushing it will drive your users back into the shadows, maybe a CoE is worth a look. Microsoft developed a CoE "starter kit" . From the document: "The Center of Excellence (CoE) starter kit is a collection of components and tools that are designed to help get started with developing a strategy for adopting and supporting the Power Platform, with a focus on Power Apps and Power Automate." So this toolkit can help solve some of the biggest challenges, visibility for one. Basically you would create your own Power App, install their components on it, connect to their APIs and voilà, you now have visibility of all of the apps in your organization, as well as who is building them. A light on the shadows. What's in the box? Okay, there is no box actually, but some of the things that are part of the CoE toolkit are: Environment and Environment Security management, Data Loss Prevention (DLP) policy management, as well as Data integration and Gateway management. Compare that to the control you have over Shadow IT today. Is the toolkit a magic bullet to cure all ills? No, it is a part of a more comprehensive plan. Again from the document: "The kit does not represent the entire Center of Excellence, because managing a CoE requires more than the tools alone; the Center of Excellence also requires people, communication, defined requirements and processes. The tools provided here are just a means to get to the end goal, but the Center of Excellence itself must be thoughtfully designed by each organization based on their needs and preferences." So there is more to do. Why bother? Bringing Shadow IT into the light alone is a huge benefit for IT, but actually embracing the Power Platform and fostering and nurturing it's "governed and controlled" use, has had significant proven benefits for Enterprise organizations. Here I will provide a few highlights and links to case studies. A small team at G&J Pepsi with no previous app-development experience created auditing apps that saved the company $500,000. Link The Miami HEAT used data insights to grow fan engagement and increase season-ticket sales by 30 percent. Link Virgin Atlantic creates custom-built mobile apps to continually improve the start-to-finish travel experiences of 5 million passengers a year. Link One Autoglass employee created 40 apps that boosted the productivity of 3,000 field technicians and brought $40,000 savings. Link France’s national railway improved maintenance procedures and incident reporting by enabling employees to create more than 150 apps. Link There are a ton of other stories about how IT, partnered with their users, has become the hero in their organizations. What's Next? Well, the first thing you should know, is that the CoE tools that are "provided" by Microsoft, are not "supported" by Microsoft. They have enough on their plate. So it is pretty much a DIY project. My company Forceworks, is offering a free CoE Briefing to learn more, you can sign up for that at forceworks.com/coe .…
I know... this is out of left field right? Me doing a review of a Power Platform solution. But I know the team behind it, and I thought hmm... maybe this could be an angle for some new blog content. So, what the hell! BTW, I am not being compensated for this, nor did they offer... cheap bastards. What's wrong with sales today? Sales has always been a black box. Great sellers have their secrets, but would rather not share them. Bad sellers just show up and check boxes until somebody finally notices they did not sell anything and fires them. Most sellers fall somewhere in-between. Obviously, we would like to elevate their skills to the level of the Great sellers; maybe send them to training, etc. But most of the great sellers I know, never went through any training, they were simply born with a gift. Everybody seems to think they are lucky... but they make their own luck; it's part of their gift. In your sales team, hopefully you have some Great sellers, hopefully you keep your roster lean on bad sellers, which means the bulk of your team are "average". Over time, some of those average sellers will blossom, but most will not, and those are the largest part of your sales force. You will never turn them into Great sellers, so you need to figure how to get the most you can out of them, the way they are. Average Sellers Average sellers know they are average. They can see the Great sellers and wish they had their gifts... and job security. They know they are better than the bad sellers, who may be able to hide in plain sight from management for a while, but all the other sellers know exactly who the bad ones are. Eventually all bad sellers get the boot. Once than happens, the lowest ranking average seller is now at the bottom... and possibly slipping. Average sellers are under the most pressure. And pressure usually leads to bad sales motions. Bad Motions What is the worst bad sales motion out of all of them? Desperation. This has killed more deals, and turned more average sellers into bad ones than anything else. Desperation to close a deal, make quota, stay off the bottom... and all right now! There is no time to waste. " Gimme a hot lead and I'm gonna call them right now and make them buy! " They jump on the phone, pressure the customer and hear something like, " I don't know if I want your product/service or not, but I know I don't want it right now", "Ok, fuck that guy, I never look back, gimme another one." Wait, did he just say "I never look back" ? CRM as a "Look Back" Machine CRM was born out of the realization that most deals don't close on the first phone call. There are very few businesses left that can survive on the "One Call Close" strategy. Society is much more skeptical today, than in those good old days. So this means you are going to have to make contact more than once to close any deals, and for some things it may require many touches, over an extended period of time. This is what CRM originally tried to solve for, a place to store and track all of this information until we could finally close or lose a deal. Of course it is all well and good to have a repository of your customer history to draw upon, providing you actually go back and draw upon it, instead of focusing all of your energy on new ones. The Watering Can Most sellers suffer from the watering can dilemma. They are watering all of their seeds, consistently and evenly, until one sprouts... then they dump the entire remainder of the can of water on that one. While they are desperately trying to get this hopeful sprout to bloom, all the other seeds wither and die. Water in this analogy is of course, the seller's time. The key is to create more of that, but time is finite... or is it? Is Time Finite? Yes, of course it is, that's a stupid question to even ask. So instead, let's talk about cloning yourself because that is possible right? Well, sorta. In our business we call the closest thing to cloning, "Automation". How does Automation clone a seller? By automatically performing routine sales tasks in the background, on behalf of the seller. How many more hours can this add to the Seller's day, I guess it depends on how much of their work can be automated. Automation Automation is not a new term in our industry. Microsoft has made huge strides in the automation space, as have others. To be sure, the toolbox is there, but the machines are not, they need to be assembled. Microsoft has given us a lot capabilities to automate routine tasks, and for sure, if you spent enough effort you could automate some of your Sellers' time. It would certainly be handy if there was a solution out there that was designed to do exactly that. The Solution Okay, I know this was going to be a review of a solution, and one that I think can tackle many of the items I discussed here, but to be honest, I don't have time to get to it in this post. This is not an intentional "Cliffhanger", I just got some other shit to do right now. I come back to this shortly.…
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As an ISV, with solutions for both Dynamics 365 and Power Apps, I was encouraged about the attention that Business Applications ISVs are getting recently. Unfortunately, I.P. protection is not one of the items coming anytime soon. Managed Solution Myth Many ISVs believe that their managed solutions are safe. Having taken great pains to ensure that their managed solution never gets in the wrong hands, by requiring that their own teams install it for example. Thanks to some utilities in free open source solutions like XrmToolBox for example, managed solutions are not even close to safe. Using a tool in the XrmToolBox called "Manage Solution" for example, I can login to any instance I have access to, and view a list of both managed and unmanaged solutions. The good news is I can only download to disk a copy of unmanaged solutions. However I can copy a managed solution into an unmanaged one, and then of course download a copy. So getting an unmanaged copy, of your managed solution that is installed on an instance I have access to, would take me about 30 seconds. I can now install your unmanaged solution on another instance, and poof, I have absconded with your I.P.. I can even take Microsoft's own Managed Solutions. Plugins Many ISVs feel that Plugins are safe. Well, using the "Assembly Recovery Tool" (also in XrmToolBox), I can download any dlls, managed or unmanaged. Pop open a freely available decompiler, and poof, I now have your Plugin I.P. Power App Components Forget about it, these run client side and I can scrape your I.P. right from my browser. Reverse Engineering Using a few freely available tools, an unscrupulous party can rip off and reverse engineer anything we have today. It happens. Sometimes it is a creepy, but savvy customer who just wants to get out of paying us for our solutions. Tinker here, tweak there and boom, they have it for free. Worse yet is unscrupulous parties that will take your I.P., re-brand it as their own, and resell it. At least I have been told by Microsoft that if we see that in AppSource, they will remove it. What Helps? Shifting necessary code off of your solution to your Azure is one scenario. At least on "your" Azure you can turn it off or on. If your solution has to reach outside, to get some bit of code or information to make it run, you at least have created a minor barrier. Code obfuscation is another technique that can help, but that is also not 100%. What Works? The only defense you have, in my opinion, is marketing. You have to build a brand and a reputation, that sane people will value over some low-cost knockoff. This is easier sad than done. It has taken us almost five years to establish a brand (RapidStartCRM) and a reputation, and still I hear people confusing us with knockoffs with similar names. There is of course, nothing illegal about liking someone's idea, and creating your own variation of it. But it still sucks to the one who did it first. What is not worth the effort? Let's face it. Most I.P could be reverse engineered even if I could not get your code. Just using it and understanding what it does is enough for a smart person to go create their own version. While their at it, they may as well go ahead and improve on your idea. In our solutions we have forgone the potentially very expensive, and not very effective anyway, I.P. protection efforts. We are able to track usage, and let customers know when they are out of compliance. This works with the 95% of customers who are honest. To me it was not worth the investment to attempt to thwart the %5. In retail, they call it "shrinkage". Obviously if you have extremely valuable, or highly proprietary I.P. you may look at it differently. Windows I have used this analogy for many things about Microsoft, and ISV solutions are no different. When you think you have identified an idea, a window opens. Shortly after you go through it, others will follow. In a relatively short amount of time, that same window starts to close. Either too many people went through it and there are no margins left, or Microsoft patched the hole you found and your solution is no longer needed. Today, windows close as fast as they open. If you are going to be in the ISV game, you need to move very fast with ideas, and always been thinking about what you will do next.…
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Many of you have probably heard me talk about the new Power Apps Per App Plans. At $10ea, I know a lot of people are inquiring about it from my Save 90% post a while back. It's real, but it's different. Until Jukka writes the definitive post on this, I will give you my thoughts. Licensing One thing that most everyone can agree on, is that licensing for the Power Platform is complicated. It was complicated enough when it was just user-based licensing to determine what license a user needed, for whatever it was they needed to do. Now we have "Capacity-based" licensing. The simpler examples are things like storage, where when you run out, you add some storage "capacity". But capacity-based licensing is spreading it's wings. Would you like fries with that? Addons are a model you will continue hearing more about from Microsoft Business Applications Group. In a way, it is moving from pure user-based licensing to more of a consumption model... sorta. We currently have five items so far that are offered as "Capacity Addons" for the Power Platform: AI Builder Credits Portal Logins Portal Page Views Flow per Business Processes App Passes These $10 "licenses" I have been talking about, are the "App Passes". Taking a Pass App Passes are not the same as User Licenses. First, they are assigned to an App; or more specifically to an Azure AD Group, more on this later. This makes sense as they are designed for accessing a particular App as opposed to just anything. Using App Passes is a three-step process: 1) Purchase, 2) Allocate, and 3) Consume. This sounds easier than it is, depending on what you want to do. Purchase To purchase App Passes Microsoft refers you to the licensing guide . According the guide, you can purchase these passes through all of the normal channels, so the same place you buy your licenses today should have them. While Microsoft refers to the Per App plan as a means for users to "Get Started" . I am sure many users will never go beyond them. I'll discuss what you can do with these passes in a moment. Allocate This can get a little tricky. Once you have passes available and allocated to your environment, you can allocate them to users by simply sharing a "Canvas" App with other users. While Canvas apps certainly have their place, the real goal is to use these passes with a model-driven app, in my opinion. So how do you do that? First, you have to create an AAD group, then you would assign the "PowerApps Per App Baseline access" to the group, you can get that here . After that, add your users to the group. Are we done? Not yet. The next step is to generate a Canvas app from the CDS environment that you plan to use the passes with. You can use the automated app generator for this, as I don't think you will use this canvas app for anything later, here's how . Now assign the security role to the group who will use the Model-Driven app. Then share the Canvas app with the group, and finally share the Model-driven app with the same group and assign the security role for that. Wow! They are not making this $10 pass easy to use. Stay tuned for Jukka's much more detailed step-by-step that I will suggest that he write. Consume You will need to indicate for which apps you want to allow Per App Passes to be assignable. Here's how to do that . Is it worth the effort? This will depend on how you plan to use apps in general. Instead of "Per App", you could opt for "Per User" License. Per User Licenses are assigned in the traditional way, and have the advantage of being able to use any Power Apps that are created, instead of being tied to a single one. However, that will cost you $30 more per user ($40 total). An "App" in the Per App plan can include a Single Model-Driven application, plus a single Canvas App, plus a single Portal. (You can use as many embedded Canvas Apps as you want in your Model driven app.) Power Automate is also available within the context of the App. So you can build a pretty robust business application within this framework, particularly of you spend some time up front on architecture. Once you have done the work up front on the AAD group etc, adding passes and users should be a pretty simple process, so it's more of a one-time effort. Saving $30/user/month may not be that significant if you only have a small number of users, but it could quickly add up for larger teams. BTW, Microsoft has told me that they plan on making this process easier for Model-Driven Apps. Details to come. Architecting for Per App Passes While Microsoft advocates the Per App plan as a way to "Get Started" with Power Apps, we have seen some customers solve some pretty advanced business problems with a single Model-Driven app. Add the ability use a Canvas app and a Portal to that, and you can build a complete business solution for a small to midsized business, or a department in a large enterprise. I wrote a post a while back on Architecting for Power Apps here . Let me know how this "Per App" approach works out for you!…
Okay, I know it has been a while since I wrote a post. It's been a very busy time, and since Mark Smith and I started do a weekly live show , I felt the base was sort of covered. But people have pointed out that my retweeter has run out of fresh content, so I am compelled to write this. Whirlwind Continues So I had a last minute change of plans, and headed over to Ignite for the first few days. Wow! It was the Power Platform show. If you have not been looking at the Power Platform yet, that train has left the station. Now you will have to run to catch up, but you better do just that. BAG is pouring the lion's share of their investment into all things "Power". There is no "catching your breath", more things announced at Ignite, while we are still digesting the last things. The least interesting announcement was the official name change of Microsoft Flow to Power Automate ... or as I like to call it, "Powerate" or "Pautomate", we'll see which one I can make stick... just to annoy Alysa. For now, let's look at a couple of the real things that James announced in his post . Power Virtual Agents Finally we have accessible bots. Accessible because they are code-less . Yes, get used to hearing that term. Up until now, we have had the bot framework, but that was over the heads of too many. The new Power Virtual Agents provides an easy interface for creating simple to complex bots without a single line of code. It is in preview, so you can play with it today. Get ready for bots to take over the world now that anybody can build them. Hmm, maybe this is not a good thing... Robotic Process Automation (RPA) This one will be interesting, and probably mostly Enterprise focused. Basically not everything out there has an API. Yes, believe it or not, there are many legacy applications in the wild that the only way to interact with them is via the UI. Mostly desktop, but even some web-based applications have no API. So there is this potential siloed data store, and we can't have that in the CDS age. Microsoft has introduced UI Flows , their name for their RPA solution built on Selenium . Seems like it should have been called " Power UI Flows ", but it will probably change a few times anyway. It is interesting to see how far Microsoft has come, now building on top of open-source software, that was once called a " Cancer " by former CEO Steve Ballmer. Teams Integration Clearly, Microsoft wants to "own" your desktop real estate. You can't "own" it with a Power App alone, but you could own it with Teams... if it allowed you to do everything you needed from within it. So the Teams integration continues to see love from Microsoft. I have been on several enterprise calls lately where Microsoft was demoing Power Apps. I was caught off-guard when they launched Teams, and worked with the Power App entirely from there. As Power Platform SIs and ISVs we need to be taking note of this shift. I think it may quickly become "the way" people engage with our apps. AI Builder Her's another one that probably should have been called " Power AI ", and may have some name changes also. Here we go again, code-less AI, utilizing pre-built templates that Microsoft has created. I have had a few discussions on my " Steve has a Chat " series with Microsoft leaders about the challenge of getting AI off the ground. Everybody wants it, but it was a lot of work to deploy. Well, heavy-duty AI is still going to be a lot of work to deploy, but you can have some simple, yet high value, AI in an hour now, with these templates. It's all about creating the addiction. Ignite Pivot I sat in on a couple of sessions by Microsoft people. Sessions that I had seen previously at UG Summit. It is interesting how they slant the narrative for a different audience. At UG Summit, which is primarily end-users, it was all about " You don't need a developer to do any of this ", at Ignite which has a huge developer crowd, the same slide was presented as " The Citizen can't do shit without developers ". I'll keep watching this dance play out, but I'm sure I'm not the only one comparing notes. Enterprise Control Lately, there seems to have been some angst created in Enterprise IT departments with how Microsoft is pushing Power Platform directly to the end-users closest to the business. There were a lot of sessions and focus on this at Ignite. Clearly, Microsoft knows that if they gave IT a switch to turn things on, they would never do it. So let's pivot the conversation, and they had several large IT organizations up talking about how their businesses have changed for the better by fostering this motion, instead of fighting it. In one session I saw, Ryan Cunningham had the best possible answer to the question of new "Shadow IT": a single slide showing the Office 365 Login screen. Controlled by Azure Active Directory, "Shadows" are not really possible. Mic drop! Adding a space One minor item, that got almost lost in the buzz, was the space added to the name " PowerApps ", it is now officially " Power Apps ". It may seem insignificant, but it is another "alignment" for the future of "Power". I have it on good authority that we will see more "Power things" in the future. I can't wait!…
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In this episode of "Steve has a Chat", I catch up again with Steven Guggenheimer "Guggs" to get the latest on the ISV Connect program. I also had a few surprises for him. Enjoy! BTW, don't forget, Mark Smith (@nz365guy) and I do PowerUpLive every Wednesay at 4PM EST, click here to be alerted, and here's a link to the replays!…
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1 Steve has another chat with Charles Lamanna 29:22
29:22 Play Later Play Later Lists Like Liked29:22
Play Later Play Later Lists Like LikedIn this episode of "Steve has a Chat", I try and sneak up on Charles Lamanna again, but no dice. Recently promoted to CVP, Citizen Application Platform I wanted to see if I could get Charles to help clear up some of the confusion around licensing and API limits that seem to be the topic of the day. He was more than happy to help me set the record straight. Enjoy! Full transcript follows: Charles Lammana: Hey Steve. I bet you're recording this, aren't you? Steve Mordue: Charles, you know I am. Did I catch you at a time where you could talk for a little bit? Charles Lammana: Yeah, for sure. I'm about to go to dinner, but I'd talk to you anytime Steve. Steve Mordue: I appreciate that. So we're recording this on Friday the 13th, that's ominous. And right now there's a lot of questions out there in this space, and I thought, "You know what?" I'm going to grab you and see if we can't answer some of these, for some of these folks. I've been fearlessly FUD fighting for the last week or two. I thought I'd just go grab the horse and get his mouth, so. Charles Lammana: Sounds good. I can guess what you're fighting, but I'll let you share that first. Steve Mordue: I will. Before I do that, congratulations on the promotion. Charles Lammana: Thank you very much. Steve Mordue: Corporate Vice President of Citizen Application Platform, right? Charles Lammana: Yeah, that's right. I think I dilute the Microsoft CVP brand a little bit, but- Steve Mordue: I don't think so. I don't think so. Are you still seeing that girl that you introduced me to a little while back? Charles Lammana: Yes, yeah. And you know what's funny is, the place I'm going to dinner is actually the same place that we ran into each other- Steve Mordue: Oh yeah? Well I guess she chose wisely then, in selecting a boyfriend. Should we read anything into the Citizen being part of the title? Charles Lammana: So Citizen Application Platform's been the name for our team for a while and the main focus there is not like citizens of the United States or any country, but instead that anybody, even if they're not a professional developer, can use the Power Platform to go create applications, create dashboards, create flows and so on. That low code element. So that's the real focus, why we have the Citizen Application Platform. Steve Mordue: So we're already shortening that to CAP? Charles Lammana: Yeah. Steve Mordue: You guys calling it CAP inside too? Charles Lammana: Yeah, it is a mouthful. Steve Mordue: It is. Charles Lammana: And people ask me, do I work with the government or something. But nothing related to the government, just making it so anybody can build apps. Steve Mordue: So I think that a lot of the questions, of course, are coming around from the Dynamics 365 guys. It's interesting because we used to all be Dynamics 365 guys and now there are Dynamics 365 guys and Power Platform guys. And they overlap some, but there's clearly a path for those like myself and others that have decided, "We're going to go Platform all the way." And a lot of the partners that are still heading down the first party all the way, and some of the confusion that's out there around some of the new licensing things. The two things that keep popping up on me and Mark's live weekly show, have you heard that yet by the way? Charles Lammana: I haven't, but I'll check it out. If you guys are talking about licensing, I got to hear what you're saying. Steve Mordue: Oh, we're just saying wrong stuff I'm sure. But licensing and of course the API stuff popped up and I've been responding to both those and I realized that one of the things I was saying might not have been correct on the new per app licensing. Now you know that that $10 per app licensing is blowing up everybody's head, right? Everybody's thinking, "This is crazy. This is going to blow up the market. How can anybody make any money?" But clearly this is a scale play and I was just under the assumption, I guess because of the way I was reading this stuff, that that $10 license was for a single app that you just built on the platform. And Ryan Cunningham confirmed with me the other day that no, you could use this on the Dynamics 365 instance as well if a user's only using a single app that doesn't use any restricted entities. Steve Mordue: Well there's hardly any restricted entities in the sales app and I thought, "Well, I mean you're just going to have a bunch of people that are going to pull out a couple of things in the sales app they may not be using anyway and start paying 10 bucks instead of 95." Clearly that's not the intent. Was he wrong, am I wrong or is there just this idea that, "You know what? We're going for scale at 10 bucks and everything else, get out of the way"? Charles Lammana: You're both right, but let me inject an additional piece of information. So even in a Dynamics instance you can use the new per app per user license, that's $10 for power apps, as long as you don't use any of the restricted entities or any of the application IP, like a schedule board or something from field service. The piece of information that's missing is that list of sales restricted entities as part of the new per app per user license, there's a few more entities from sales that will be added to that list. Steve Mordue: Now it starts making a little more sense. Yeah, because I was thinking whoever owns the sales app must be crapping their pants over there at this stuff. You've got to throw him something to keep his PNL going. Are you at liberty to say what those are yet? Charles Lammana: Yeah, so I don't have the exact list off the top of my head, but I mean the intent is exactly as you described with the list that we have. And that is to make sure that if you are using the dynamics for sales application IP, which has a whole giant engineering org working on it, then it's only fair to pay Dynamics 365 for sales licenses or we'll go purchase them. So it's not going to be contact, but the ability to create an opportunity or manage opportunities, that probably should be restricted, if that makes sense. Steve Mordue: Yeah. That's where it starts kicking into the logic and certainly those aren't components of the platform by itself, whereas contact is, and that's where you start bringing in the Microsoft vetted logic around all that stuff. So that makes sense. That makes sense. Plus it's good for me, as you know, from what we're doing, I'm sitting here thinking, "Oh great, everybody's just going to go start paying 10 bucks for the sales app and I don't have a business anymore," so I'm still good. Steve Mordue: On the API stuff, and I've been kind of comparing this, there's a lot of FUD out there and frankly I've probably created some in the past, I know, I've not always said positive things, but at least I said things that were true. And lately, every time you guys go and announce something, and I'm just picturing you guys sitting back there reading that thing a hundred times thinking, "Okay, this is going to be fine, right? Nobody's going to have a problem with this." And it pushes a publish button and all hell breaks loose. And I feel for you guys, I really do, especially when these folks just attack anything you say and try and turn it into the worst case possible scenario. And the API limits I think is the one that all I'm hearing people say is, "Open a contact record. It does 50 API calls," you know, they're clearly taking that conversation in a direction. And my understanding from you guys is that when you do things like this with these limits, you're looking at a fraction of the market that's outside of it. I mean 95% of the people out there today shouldn't even have to think about this. Is that a fair statement? Charles Lammana: That's exactly right. And I mean all the limits are a bit ... at this point Dynamics is such a big service with such a big surface area and so many customers, we can do pretty good quantitative analysis of what a typical user or a typical customer does. And we did that and that's where the API limits came from because our main focus, put very simply, we want basically all except the most sophisticated complex implementations to just require user licenses, because it's just such an easier conversation for the customer and Microsoft. I have a thousand sellers, I want a thousand sales apps, that's it, boom, done. You don't want to have to go architect, "How many API calls did they make? How many integrations do I have?" And basically our position is you shouldn't have that conversation if you're just going to do this, the vanilla sales workload or vanilla general power apps, workloads over CDS; you don't need to go even think about API calls. Charles Lammana: And we do that. We do it because there are customers who do use a lot of API calls and it is important to their implementation and they'd like additional API capacity where there's no way for them to purchase it from Microsoft today. So we have to have a limit and then we have to have a way to purchase incremental API calls in order for that model to work. But again, the idea is we're not selling infrastructure or PaaS, there's no cores, none of that stuff. We just want customers to be able to buy USLs for power apps, for Flow, as well as for Dynamics. Steve Mordue: Yeah. I think it kind of creates some fairness too because obviously we've had issues in the past with a certain segment of customers that are getting a lot more from the platform than intended and everybody else is using it as intended. So I can imagine if you've got some customer that, because of how they're using the platform or running their business or generating a zillion API calls, well they should be paying more. They're getting more out of it. They're doing more with it than the average customer who isn't. So I think it makes it a little more fair. I've always been annoyed at thinking that my customers or myself am subsidizing other customers overuse, you know? Charles Lammana: Exactly, yeah. Tragedy of the commons, right? That's what the problem is with the multi-tenant SAS. If people can use way more infrastructure at no incremental costs or has issues, we're just trying to shape that behavior. But I mean I'll own, from a Microsoft point of view, we could have done a lot more to more clearly communicate those changes and make it more obvious and provable that the vast, vast, vast, vast majority of our customers will not be impacted. And we kind of view it, and it's kind of funny, we didn't really expect such a pushback on it, but we viewed it as just like that little asterix that you have with your cell phone or cable provider where when I get my internet from Comcast I don't think about how many gigabytes I used to download, but there is a limit. I mean it's really big and I bet like almost nobody hits it, but there is a limit at some point of internet download I can go do with my internet provider. But they have those same types of protections. But I just don't worry about it because it's not front and center. We should have done more to make it clear that that's the intent of these changes, to be that little asterix that you really don't have to think about unless you're doing something well outside the normal bounds. Steve Mordue: You know, and we had the same challenge with the storage when we tried to change the storage for the better. And when that first got announced all you heard was, "Storage is going up eight times," and everybody's thinking, "Oh my God." And you guys retrenched a little bit, came back with a little clearer story about how that would work and I'm sure some people are paying a little more, but none of my customers are. So that doesn't seem to have impacted but a fraction of customers also. Charles Lammana: Yep. Yeah. And a lot of those changes, our whole goal is we want our billing model to also not drive weird behavior or bad behavior that make it hard to implement. And the old storage instance cost model did that. So I mean that's why it was really important to change and some of the new API call models also do that. We just wanted to make it so if you build things the right way, the licensing and billing model will reward you for a more reasonable price. Steve Mordue: So you say you don't want to reward or create weird behavior, but we just launched a $10 skew that sits on a platform that has access to all of the XRM capabilities. If somebody was motivated enough and had enough budget they could essentially build the entire Dynamic 365. They wouldn't, and as I stand back and kind of look, from my perspective, haven't been probably one of the first people in there when there still was missing parts and seen them come, I've seen the portals come, we've seen the Outlook come, we've seen the accelerators now have CDS only versions, we're just seeing more and more stuff coming to the platform, that that's got an awful lot of appeal to people to ... I won't say do weird behavior, but who think, "I want to get off this $95 skew if I can." I mean what's the thinking inside on that? I mean that's got to be expected? Charles Lammana: Yeah, I think just our viewpoint would be if we ... I would say we are quite confident on the Microsoft side that the value and the intellectual property and the ongoing services and support and SLAs and integrations that come with the proper Dynamics applications can and will continue to command those prices. And it's not always $95, we also have Sales Pro and Customer Service Pro which are a cheaper price. And even if you use the pro license or the enterprise license, it also entitles you to a multitude of custom applications in that same environment, which the $10 per user license doesn't. Charles Lammana: So I think we feel pretty good about that value prop, and going back to the ... we don't want to do artificial things with our billing model. We think a platform for one app, $10 per user per month, that can unlock the entire world to build all their apps on that platform and we feel like that's the right price for it, the right level of cost between the customer and Microsoft. And we wouldn't want that statement, which we believe to be true, to go be limited because we also think that we can sell a finished SAS application in the case of sales or service for pro and enterprise at a higher premium. Charles Lammana: We think both of those things can exist and we will have blends. Like we will have customers who will repurpose their sales license for platform capabilities and we'll have customers who will use our platform license to go and try to create a mini CRM, and we think that's okay. I mean that's just their own calculation based on their value. But we're aiming for the 95 to 99% of the entire world where we think the value prop works pretty well. Steve Mordue: Yeah, I mean I know that when I look across our customer base there certainly is a significant percentage of those people that are heavily using a lot of those high value features that you talk about. And then there's a segment that just never did, they're just kind of using basic stuff, and those are going to be pretty simple candidates to say, "Hey, you know what? You're not using all this stuff, just drop down." Or try and do a sales job to get them to start using it, because the worst case scenario is they aren't using it and they feel like they're paying too much and then they just churn out. And I'd rather move them down and keep them on something that they want, maybe they grow back up. Steve Mordue: That's another story that's had a little confusion out there is that migration back and forth story. Now, my understanding today is of course if we start on CDS and the customer says, "Hey, this is pretty good, but I want to get some of those snazzy features in the first party," right now we're looking at a migration project, I think. Is that something that you guys think will be fixed or is it something that is a concern or something to think about, or are we just kind of looking at those as different customer types? Charles Lammana: No, I'd say we definitely don't want to require a data migration like it does today. We want to get to a proper model where ... because I think of CDS and the platform as almost like Windows OS, right? You buy the Windows OS and then you'd go buy all the apps that you want and install it on the OS. And it's not like if I buy Windows and I install Office, but then I want to install, I don't know, Adobe Acrobat or something, I have to go re-image my Window server, right? So we want to make that be the right layering, and that's really just an architectural legacy reason for being that way today. But longterm, absolutely, you want to allow it. So you start with CDS, you can add sales, you can add service, you can add field service, you could add Talent, you could add Project Online; you can add and mix and match all these different applications on top of that CDS environment. Charles Lammana: And we have early positive signs where that happens. We can't do it for the core CRM app yet, but low approvals, which is modeled as an XRM app and Project Online from Office 365, that's also an app installed on CDS. Those, we actually have many customers who start with a blank CDS and then end up with both of those applications installed in addition to Talent, which is also an app on top of CDS. All those three apps added incrementally, organically over time on top of CDS. So that works great, we just need to go make it so the core CRM also can do the same thing. And that's just some legacy reasons, which as you know, we've been on a journey the last year and a half to go clean up and we're kind of going piece by piece, like Outlook, then Activities and server-side sync are all just some examples where we're hammering against that, but we think we'll get there, no problem, in the foreseeable future. Steve Mordue: Yeah, I mean for what we've been trying to do with the RapidStart, the Outlook app was definitely something that we needed. I mean everybody was wanting something like that, so thank you for that. And you knew I was hammering you guys for it too. Charles Lammana: Yep. You would never let me forget it. I mean I wanted to make sure it was done before we had this phone call happen again, but ... Steve Mordue: No problem. You guys got it done. Appreciate that. Charles Lammana: Yeah. Yeah, and I've heard quite a bit about RapidStart, so it's great to see the traction of a third party app bill on top of the platform, it's really exciting for- Steve Mordue: Oh yeah, yeah, we're excited too. We're developing some now on top of the accelerators, so, and the ... you having much to do with the accelerator groups? Smith and- Charles Lammana: Yeah, so it's not directly out of my team but we collaborate very, very closely with them. But yeah, I mean accelerators are so key because the world increasingly is going to industry-based motions, like if I'm a financial institution, do I really have to rebuild all the financial services goo that goes on top of a CRM or CDS all the time? They don't want to, so the accelerator just provides a ton of value out of the box. Steve Mordue: Yeah. So they just, with the banking accelerator, I think it's the first one where they released a CDS only version and then some additional add on versions that might take advantage of some of the first party. And I was talking to James about that and he said there's a plan to kind of go back to the other ones. So as soon as they did that we took a look at that banking core, which is an accelerator, and put our accelerator on top of that accelerator, "That'll be real fast," and looking at trying to leverage those accelerators. I think that's going to be an interesting ... I'll be curious to see what the market does with something like that that's built on an accelerator. It'll be a good test for the market. Charles Lammana: Jjust on the accelerator bit, for Dynamics 365, our core customer engagement or CRM app, the accelerators have been absolutely key the last six months to drive business. Steve Mordue: Yeah, I've been hearing that. Charles Lammana: Financial services places, man, it's been a lifesaver for us because customers just love to see that fast time to value. And then so just we think that accelerators are going to be really important for the platform, for the Dynamics apps and for third party apps and building our ecosystem. Steve Mordue: You know, talking about data models and industry data models, what's the latest on ODI? Is that progressing as you had hoped? Is it going faster, slower or is it going to happen? What do you think, or is there too many people punching- Charles Lammana: It's advancing exactly at the paces we would want/expect, and I'll expand on what I mean by that. ODI is one of those super industry changing efforts and motions, and the reason it's industry changing is because we're bringing together so many companies like SAP, Adobe and Microsoft, that historically don't partner together and are built completely different stacks. We're bringing together all three companies to go do something, to create basically open data for our mutual and joint customers and a well-defined schema with a well defined set of entities to deliver a bunch of value to customers. So that's going to be a big deal when it lands. But just- Steve Mordue: It's a big rock. Yeah, it's a big rock to move. Charles Lammana: Exactly, three companies and 25 different applications, you mix in Dynamics, you mix in Office, you mix it Azure on the Microsoft side, it takes time. But when it arrives it's going to be a big deal. So ODI is absolutely something to pay attention to and it's something that continues to get significant investment from all three companies. It's taken its time, but I think it's going to be, whenever it arrives, it's going to be a really transformational item for our customers. Steve Mordue: Are you still driving that? Charles Lammana: I'm not. Robert Bruckner on our team is driving that. We support it from a platform, of course, just it's a lot of energy to go drive that process, so I'm glad we have Robert shouldering the burden. Steve Mordue: Yeah. So we've got October release coming right around the corner, and of course the advance news that has come out, all anybody has been focusing on, the FUD rakers, is on licensing and APIs. But if you take that part of the conversation aside, which I feel like we should have done in our conversation so far, I feel like we've accomplished that, to all but the truly ignorant, if we take that part aside, what do you think are some of the most exciting things people should be looking for in this release for Power Platform? Charles Lammana: I would say there's a few little things which I think are a big deal, and then there's a few big things. The little things are just usability improvements. If anyone's gone on and turned on the October release switch in the admin center, you will notice a significant modernization of the unified interface for model driven applications. There's much better grid density, much better density on forms, way less wasted white space. Better- Steve Mordue: And how long have we been hearing that, right? People complain about white space. So just glad to see that one finally get behind us. Charles Lammana: Oh man. And they're all little things, but you know what? We fixed the top 10 most painful user experience items of unified interface for October. And it's hard to do that in a way which doesn't trigger a whole bunch of retraining for our customers, so we had to be really thoughtful and diligent and you may not even realize it if you first turn it on, but just open it up side by side and we're really proud of those. Lots of little changes, lots of little pebbles that together really changed the experience for Dynamics and for model driven applications for power apps. So those are kind of the little ones. I'm very excited about that. Steve Mordue: Yeah, I was poking around in an October version and yeah, you could definitely feel it. It's not dramatic, it's not like, "Oh my God, where am I at?" You haven't lost anything. But you definitely sense right off the bat the density and then the features that have been added or ... yeah, I think you guys probably did a smooth job of that. So now tell us about the bumpy stuff. Charles Lammana: Yeah, the big stuff, the bulky stuff would be AI Builder is reaching general availability, as is PowerApps Portals. And we think that basically a modern platform needs to be able to support B2C, so external users to your company as well as anonymous access, and PowerApps Portals delivers that for the standalone PowerApps customers. And then we also believe the future of all applications and all automations and workflows is an intelligent, enriched experience and AI Builder delivers that for us. So you can use binary classification and prediction capabilities inside of AI Builder to make your power apps that are canvas model driven, but are built on top of CDS, make them much smarter. And that is one of my favorite features, it's just so amazing how easily you can enable a machine learning model without any data science or even developer background. Charles Lammana: And then also we have like things like the Forms Recognizer which actually parses digital paper, PDFs, JPEGs, what have you, extracts that information into a structured form and you can use that in your power app or your flow. And we're seeing unbelievable adoption, almost 50% of all AI Builder customers are using the forms understanding capability. It's so transformative for the back office, and if you haven't checked it out, just use it and then your mind will start racing; "My legal department, my finance department, my HR department, my procurement department, all of them can just work so much more efficiently if you can get forms recognized or working with the flow." So we think Portals and AI Builder are two big, bulky, meaningful changes for Power Platform. Steve Mordue: And AI Builder goes across, right? I mean you could stand up AI Builder on just bare CDS, you could stand it up on first party, it goes across, right? Charles Lammana: Yep, absolutely. And I apologize to anyone else from my team that may be listening that I didn't mention your feature that you worked on, but they're all important in the October release. But those are my three most favorite children. Steve Mordue: I definitely am hearing excitement about AI Builder and Portals is another one that's getting its share of FUD, something I read recently and some guy jumped on social talking about how Salesforce is so much cheaper because of this, that and the other. And unfortunately Dileep Singh happened to see what was going on, he jumped in and said, "Wait just a minute here," and kind of clarified some stuff right out there that reversed that whole story. So I'm looking forward to the day when we don't have a whole bunch of people out there watching your every move looking for the gotchas. Charles Lammana: Well I would say our goal at Microsoft is broad adoption, which I mean generally reflects in lower prices. I mean that's our goal. Like if you go to Microsoft's mission statement, empower everyone and every organization to do more, you can't do that with outrageous bespoke boutique pricing. So that definitely is not our objective and we certainly will learn and we make mistakes, but our push is we want everybody to be able to use this thing. I want everybody in the world to build apps and create flows and create power BI dashboards. Steve Mordue: Yeah, we'll leave the hidden costs to Salesforce, they're pretty good at that. So Charles, anything else you want to touch on? I've got, I don't know, millions of people that will be listening to this probably. Charles Lammana: I mean the biggest thing I would say is, and this is my kind of call to action every time I talk to you, and maybe it's an overwrought point at this point in time, but Power Platform, I mean our push is to go unify the Office and Dynamics communities with a single low code platform for all of Microsoft, and in the process make it so everybody in the world can have access to analyze data, create apps and build automations. So if you haven't checked out Power Platform as just Power Platform and outside of Dynamics or Office, go do it now. I think it's super amazing, in five minutes you can get value and just from the point of view of Microsoft as a company, it's just really critical to where we think the future's going. Steve Mordue: Yeah, I've had people ask me, "Where's the best place to start with Power Platform?" And I typically suggest Flow because it's about the easiest one to understand, the quickest of value and suddenly just light bulbs start going off. And when people are talking about building, because we are doing a lot of work with customers that are moving up from spreadsheets, that's a huge mountain out there for customers that are doing relatively complex business processes on a bunch of shared spreadsheets and torturing them. And we're generally recommending those customers go straight to a model driven app that has kind of that foundation, because then from there, you know, they can spring off with canvas flow, AI Builder, Power BI, have all those other things. And we're starting to get to a point where I'm getting crisped for that conversation because whenever you announce new things and stuff like that, nobody knows what we're talking about. The partners are behind and customers are behind-er. So, lots of education, a sales process now is an education process and probably will be for a while, because I don't see you guys slowing down. Charles Lammana: Never. We- Steve Mordue: Yeah, you're not even going to let us catch our breath before you're going to go do some stuff and keeping the partners hopping. Charles Lammana: Yeah. Steve Mordue: Well, Charles, I appreciate you taking some time. I knew I might be able to catch you here in the last hour of your work week and I was glad to do it. We'll be publishing this here, I don't know, probably Monday or something like that, get it out there pretty quick while everybody's got all the questions. Charles Lammana: Sounds good. Steve Mordue: So you have a good night, you mentioned something about dinner, so enjoy your dinner. Charles Lammana: Yeah, as always, great chatting, thanks Steve. Steve Mordue: Tell your girlfriend I said hi. Charles Lammana: Will do. Steve Mordue: All right, bye, guy. Charles Lammana: Bye for now-…
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The Power Platform is on fire! Lot's of partners, developers and citizens are all creating all kinds of things at a rapid pace, it all seems so easy. Unfortunately many of them will get down the road and realize they should have taken a fork a few miles back. Let's see if we can map out the right path from the jump. Whatcha gonna do? Before thinking about where to start, you should have clear idea of where you want to end up. Depending on the problem you are trying to solve, some choices will become obvious. If you are just looking to be notified when a new file is uploaded to a SharePoint folder? Microsoft Flow is probably all you need. Not much "Architecting" required. For this post, I want to talk about bigger things you may want to do, like building a robust sales application for your team for example, or any other function for that matter. Sure, for my Sales example, the Dynamics 365 Enterprise Sales application is one option to consider, but again, here I will go for the Platform approach. Foundation Canvas apps are great for point solutions, Power BI doesn't do anything without data and Microsoft Flow is great for connecting existing things, but for most customers we recommend starting with a model-driven app on CDS. It's not the app that is the foundation, it's the Common Data Service (CDS). CDS is the heart of all things to come, and allows for everything you start to do now, to have a full future later. The App The model-driven app you will be provided with by default is fairly scant. It does include Accounts and Contacts as a common starting point for most business applications, although for a B2C scenario you may not even need Accounts. It is a nice "rolodex" at this point, but way more powerful in it's potential. From here you can "model" your data and processes that are required to solve your initial needs. To shorten this process significantly you may want to look at our RapidStart Accelerator Applications on AppSource. Regardless of your starting point, you will likely need some further development by yourself or a Microsoft Partner who specializes in Business Applications. The good news is, the effort required is significantly less than it has ever been before. Apps As you work on your model-driven CDS environment, you may see a need for more than one use case. Maybe your sales department needs something, but you also want something for the warehouse, or whatever. By the way I am just using "Sales" as an easy-to-grasp concept, but the app(s) could be for any business need. You have a decision to make with potential monetary consequences. Do you build two separate apps, or one and control access with security roles? Microsoft is launching a per/app/user license that is only $10, and it would be awesome to utilize just that. If your users are pretty segregated, and few or none of them would have need to access both apps, you are fine. But if many of them need to access both, it will cost $10 X 2 apps. If many have to access 3 apps, it would be $30 for them. This maxes out at $40 for that 4th app as you would buy the unlimited app licenses at that point for $40/user. Still a bargain compared to past costs and other platforms. Architecting for License Cost As I said you could consider building a single app for all the different users needs and controlling who sees what, with security roles. It is more complex way to approach it, and could get unwieldy if you have many unrelated use cases, so you would have to weigh the costs of doing it that way vs. effort to make it that way. Again, this would only apply to users who wear multiple hats. Next Steps Let's say you now have a nice model-driven business application. Notice I did not say "basic", that's because it can actually be as complex and advanced as you need it to be over time. Are you done? Not even close. Now is when some of those other tools come into play on top of the foundation you have built. You have several options to go to next, one that is already covered in your $10 is a Canvas App, but this canvas app will take advantage of the CDS database you already built your model-driven app on, so all of that data is available. Also, Microsoft Flow, Power BI and Portals can be bolted on as well. So let's take a look at what these can add to your ultimate application to change the world, or at least your organization's world. Canvas Apps Canvas Apps are Task-Specific. The name Canvas comes from the design surface that you build them on, it looks a lot like PowerPoint. It is primarily a mobile application for those types of tasks that would be logically done on a mobile device. For example, adding a barcode scanner and tracking inventory in a warehouse, or a Check-in/Check-out app for corporate laptops. If this does not relate to your CDS environment, you would probably just make that Canvas App freestanding, but I'm keeping in the lanes of business applications here. Remember that the Model-Driven app you already built has full mobile capabilities also, so you will want to explore that before you complicate things with yet another app to maintain, but for the right scenarios, Canvas is awesome. Microsoft Flow Let's say your organization has some other app they are using for other things. Let's also say that it could be advantageous to have your new app talk to that app. Maybe it would be nice to pass some data back and forth when certain things happen. Microsoft Flow is your bridge to over 250 other apps and growing. Microsoft Flow sits between your new model-driven app and any of those 250+, and can pass things back and forth based on triggers or conditions. It sounds more complicated than it is. Trust me, it's not. Not long ago, to accomplish this would have required a significant development project, all gone now. Power BI Power BI is Microsoft's industry leading Business Intelligence tool. Of course you have charts and dashboards in your model-driven app, but if you really need to go deep, or mash several sources up, Power BI is the tool for that. Of course it's primary source in your case is... you guessed it... your CDS. You can create advanced visualizations in Power BI to share with anyone, and you can even embed them into your existing app's dashboard. Is it easy? Well, it's not as easy as Flow, but you don't have to be a rocket scientist either. Another option to consider is a new offering called AI Builder. This is more of a "citizen" level tool-set that is actually quite easy to use. Not as powerful as Power BI, but it can handle a lot of AI needs. Again, sitting on your CDS. Portals Things are going quite well, and you realize there would be some efficiencies gained from having customers, vendors or partners do somethings themselves. You don't really a want to give them access to your application, but some highly filtered level of access would be real handy. This is one example where Portals come into play. A web based representation of your business application, tailored for your audience, so they can interact with you touch-free. The scenarios are limitless, but take for example a case management solution. A place where your customers could create and review cases you are working on with them in your business application. A way they can be engaged with what is going on 24/7, without having to call you for an update. All running on top of the same CDS you started with. Accelerators Let's say you are in one of the industries that Microsoft has built accelerators for, and there are several and more to come. But, for example, let's say you are in the Banking business. Your path just got shorter. Microsoft offers pre-built data models at no cost to help you get to where you need to easier. Our RapidStartCRM for Banking Accelerator is actually built on top of Microsoft's Banking Accelerator giving you...umm... double acceleration! Between these two, you may already be done before you started! Summary There are other ways to approach it, but this I my recommended path that eliminates any backing up and restarting later. Regardless of where you want to get to, Microsoft has made it exponentially easier today. Start with a model-driven app on CDS, and the sky is the limit. If you want to explore how you can move a spreadsheet based process for example, onto a platform, listen to my recent podcast with a large customer who just did exactly that.…
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Recently, our contact on a large multi-year customization effort for a customer left. The new person who came in seemed to be of a mind to change things up. What was a highly effective and collaborative effort, suddenly became a battle over every hour billed. I'm on the verge of kicking them to the curb, but... Screwed by Nature There is an interesting anomaly in our business, that can ultimately lead to disaster; the seeds are planted as soon as you hire a Microsoft Partner. I don't think customers think about the end at the beginning. Why would they? They have no idea just how bound to that partner they will become over time. Houses of Cards You will ultimately be working with a person who is architecting your solution to meet your described requirements. Assuming they know what they are doing, they still have multiple ways to go about it. "Best Practices" is a bullshit term, don't get lured by it. While there are many ways to architect something wrong, there are also many ways to architect it right. It will boil down to that person's opinions based on their knowledge and past experiences. But even the most knowledgeable and experienced people will architect things differently from each other. They are all right! It's not intentional. Eventually, all complex deployments become houses of cards. It's just how it is. Removing any card. without knowing what it may be holding up, can crash everything down. This is why most partners being brought in to replace another, suggest starting many things over from scratch. It would just take too much time in forensics to figure out what the prior partner had done and why, (" What does this card do? "). This is regardless of whether it was done well or poorly. I'm sure some partner will jump on the comments and say they are smart enough to figure out anything. These are the ones that usually come back later and say " Upon further review, the last partner did not know what they were doing, and we need to start over "... convenient. Transition to Internal Team The big customization effort is complete! Let's have our own people take over from here. This is a natural and logical desire. But you better plan on keeping your partner around, and happy, because there will be issues and fires. There always are. They tend to pop up before you can even get clear of your partner. The bigger the deployment, the more dependent you are on the partner who built it, they are only ones who know where the skeletons are buried. The only bigger risk is having one of your employees build it. Citizens There is a lot of conversation today about "Citizen Developers". They will also build houses of cards, but will likely do it poorly, without the deep knowledge and experience, and then suddenly they leave your company. Admittedly, when we are called into these scenarios, starting over is often the only option. Updates All platforms go through continuous updates, Microsoft Business Applications included. These can not only bring new features, but occasionally can deprecate features you are using. As a customer with your own business concerns, you will likely not be up-to-speed on these, and will instead discover them one day when things stop working. That would be a fire, and you better have a brigade at the ready. Better yet, if you have maintained a good relationship with your partner, they will give you a heads up, and be there to make sure things continue to go smoothly. Universal This is not a Microsoft Business Applications phenomena, this is the same for all platforms that allow for broad customization. The same was true when we were Salesforce.com partners. It's also not new. The same was true for that Access Database solution Joe built for you ten years ago, and then he was hit by a bus and died. Damn Joe! Summary Eventually your partner will have you by your underwear band. Whether they give you a wedgie will have a lot to do with who they are, and how your have engaged with them. The cost of changing them will be very high, and last a very long time. Choose wisely.…
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Typically I am catching Microsoft leaders on my "Steve has a Chat" podcast, this time I thought I would try and pounce on an Enterprise Customer to get some candid feedback on PowerApps. Mona Baset , AVP of Information and Analytics Services for Atrium Health was game for a chat. Atrium Health is comprised of 40 hospitals and 900 locations in the Carolinas and Georgia. Some of the things Mona and I discussed, included the place for PowerApps in a large organization that is committed to Salesforce.com. It was quite interesting to hear how PowerApps is viewed from the customer side of the table. BTW, don't forget to tune into #PowerUpLive every Wednesday at 11AM EST, where Mark Smith ( @nz365guy ) and I discuss the latest news around all of Microsoft Business Applications, subscribe here: https://www.youtube.com/nz365guy .…
It seems clear to me from listening to people on social media, comments on my posts, and generally having an ear to the ground, that too many people, including many who should not be, are still confused about PowerApps... and wouldn't they be? A Quick Quiz. What is a PowerApp? A Mobile Application you built on top of SharePoint A Mobile Application you built on top of the common data service A Mobile Application you built on top of Dynamics 365 A Custom Application you built in Dynamics 365 A Custom Application you built on the Common Data Service A Custom Application you embedded into a Dynamics 365 Form Something Else If you answered "all of the above", you get a gold star, but you're no closer to clarity. PowerApps Camps There are three primary camps for PowerApps as I see it. There are campers that come from the productivity side of the lake, where Office 365 and SharePoint live. We also have campers from the Dynamics 365 side of the lake, busily extending the Dynamics 365 applications with their own canvas and model-driven apps. Lastly, we have the Platform side of this apparently three-sided lake, using both canvas and model-driven paths to build apps from scratch on CDS. While these campers can hear the sounds of other campers across the lake, they seem to have little understanding of what the other campers are doing over there, even though they are each called "Camp PowerApp". I want to go a little deeper into the two of these camps that are part of Business Applications that I am familiar with. Someone else can speak to those productivity campers. A Custom Application I think the biggest confusion, for those of us in one or both of the Business Applications camps, are the distinction between items 4 and 5 from the quiz. "Building custom applications in Dynamics 365" vs. "Building custom applications directly on the Common Data Service". But Steve, aren't those both on CDS? Yes they are, but they got there via two distinct pathways, from opposite sides of the lake. They are not the same thing and different rules and licenses apply to each. Dynamics 365 Campers Let's face it, Model-Driven PowerApps are just XrM renamed. Everything you ever did with XrM in the past is now called PowerApps. Along the way a few more things happened, like the separation of the first-party apps from each other, and the introduction of the ability to make new role specific "PowerApps" by mashing up parts of the other first-party apps into your own concoction. Dynamics 365 brings all of the power and advanced capabilities you could want, including A.I., MR, and all the other acronyms. This is the deep end of the pool! The separation of the Apps from the underlying platform was of less importance to this camp, but actually spawned a whole new camp. Platform Campers These campers could care less about Dynamics 365. They are building their own custom apps directly on the same platform that sits under Dynamics 365. Are they masochists or anarchists? I guess a little of both. The "Platform" is actually the old XrM framework sitting on top of a database that is now called the Common Data Service (CDS). It is but a hollow shell of Dynamics 365, containing very little in the way of usable items, yet everything that is required to build as powerful an application as Dynamics 365. This is the deep end of the pool. Deep Ends If you were reading/listening closely, you heard me refer to both of these camps as the "Deep ends of the Pool". Extending the complex out-of-the-box functionality in the first-party apps requires significant skill and knowledge. But building functional, powerful and comprehensive applications on the platform also requires significant skill and knowledge. The shallow water in the middle is where "Citizen Developers" swim, creating their cute little widgets. Fuzzy Rules When it comes to the rules, there is clear separation, but for many it still seems fuzzy. Some common examples: " You can't use a Restricted Entity in a PowerApp! " This is incorrect, a clearer way to phrase this would be " If you are building a PowerApp on top of Dynamics 365, and you include in your PowerApp a restricted entity (for example the Incident entity), the user of your PowerApp will require a license that includes that entity (i.e Dynamics 365 for Customer Service). " This does not mean that you cannot build the app! Also, Restricted Entities have nothing to do with Platform Campers. There are no restricted entities in CDS without Dynamics 365. Similarly, with Team Member and it's restrictions. Team Member licenses are a type of Dynamics 365 license. Again, Team Member has nothing to do with the Platform Campers, only the Dynamics 365 campers need to be concerned with Team Member. "You cannot replicate the functionality of the first-party apps in PowerApps." This was previously true, and relevant only to the Platform Campers, but is no longer the case. For Microsoft to succeed with their Platform aspirations, it was clear they needed to eliminate any artificial restrictions, and they did. Fuzzy Licensing The recent announcement about the Platform License changes that I discussed in my last post , referenced this blog post by Charles Lamanna. Note that this post, and these licenses refer to "standalone" (aka Platform), and have nothing to do with Dynamics 365. This post and these licenses are for the Platform Campers only. You cannot use a Per App License with Dynamics 365, Dynamics 365 has it's own licenses. Similarly, the retirement of the bundled Plan licenses for Dynamics 365 has nothing to do with Platform Campers. A Fuzzy Line The line between these two camps is very clear, yet at the same time, not very obvious. There is way too much "assuming" and lazy interpreting going on, leading to way too much misinformation, leading to way too much confusion. One way to help would be, if you don't know that what you are saying is correct... don't spit it out to the world as a fact. There is an old saying, " Better to be silent and thought a fool, than to speak up and remove all doubt ".…
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1 Reduce your Dynamics 365 License costs by 92%? 7:30
7:30 Play Later Play Later Lists Like Liked7:30
Play Later Play Later Lists Like LikedI hinted in my last post about possibly being able to reduce your Dynamics 365 license costs by up to 92%. I may have been a little too coy, so I titled this post more overtly. Was I just bullshitting you? Well... not all of you. It Depends Follow me here as there are a lot of "ifs", but many organizations will meet them. IF, you are paying $115/user/month for the Dynamics 365 Customer Engagement Plan Licenses. IF, you are only using the basic out-of-the-box features. IF, the advanced capabilities you are using were all custom built. IF, any third-party solutions are compatible, or you can do without them. IF, your users primarily work in a single application, ie. "Sales" or "Service" but not both. IF, you are not using things like "Relationship Insights," or any of the A.I., or other advanced features. Depending on your answers to the above "Ifs", you may well be able to move to the upcoming PowerApps Per App Plan model for $10/user/month. My math says that from $115, down to $10, is a 92% savings. Is this even realistic? How is this possible? The same way it would be possible for certain people to get by fine with Notepad instead of Word... unused features. As a partner who has been involved with hundreds of deployments, I can safely say that the number of customers who use every feature of the first-party apps they are paying for is... zero. I feel quite confident that number does not change for customers using even half of the available features. Of course no two customers are alike, and the mix of features they actually do use varies significantly, but they are all paying for all of the features. Obviously my 92% scenario assumes you are currently paying the highest price ($115), and that you could ultimately be satisfied with a single PowerApp at $10. Not everyone will, and many are also paying less than $115. Free Money? Not exactly. It is not quite as easy as buying a $10 license and cancelling the others. Even if you meet the parameters I outlined, or are willing to give up a few things to do so, there is still some refactoring and a migration to be done. This too will vary significantly from customer to customer. If you are able to save some money, or a lot of money, you will have to spend some money to get there, so the ROI may be deferred. For example, let's say you fit the profile perfectly. You have 150 users and are paying (let's be more conservative here), $95/user/month for the Enterprise Sales App. Assuming your actual needs could be met with a custom built PowerApp, you could potentially save $12,750/month. Of course you need to have the PowerApp built which will cost you something (you may want to explore our RapidStartCRM accelerators in AppSource, and RapidLABS services for a fast and low-cost way to do this). I don't want this to sound like a slam dunk, for some customers the cost to do something like this may actually exceed all of the development costs they have invested so far. There are a lot of factors in this equation. Power "less" By now you may be thinking, this sounds great... for an organization with simple needs. What you will forgo in this Per App Plan are the "pre-built" capabilities of the First-Party applications. But... they are PowerApps too. With enough development funds and time, you could practically replicate them entirely, but that would be silly. Instead, you would just build exactly what you need, no more and no less. We have a customer with thousands of users, where everything but Account and Contact was custom built (Account and Contact already exist in PowerApps). In their case, the customization solution (which includes a single app) could be installed directly on a CDS instance with no changes at all, then just migrate their data, and they would be in the exact same place. There are some massive deployments out there, that with little effort could go this route. In fact, for many of my customers, the Per App Plan offers more than what they are even utilizing today. An "App" in the Per App Plan can include a Web App (aka Model-Drive App) like most customers are already using today, but that "App" can also include a Mobile App (aka Canvas App), which less of them are using, and a Web Portal which very few of them are using. The Outlook App is also available and works the same way. Is Microsoft Okay with this? I would guess that depends on how many of their existing customers, walk through this door that Microsoft created to gain new customers. In my example above, trading $14,250/month for $1,500/month may be an unintended consequence of Microsoft's new model. Make no mistake, this will not be a viable option for everybody. Again, the first-party apps bring a plethora of advanced capabilities that many customers depend on, that would not be practical to rebuild. But it will be interesting to see just how many, are using enough of the out-of-the-box advanced features. The difference in cost sets a pretty high bar for Microsoft's first-party apps. Microsoft will need about 10 net new PowerApps Per App users to make up for each D365 Plan user who makes this switch, but clearly their expectation is that the PowerApps Per App Plan model will blow up to a point where they don't really care. And why wouldn't it? This is more potential business application "power" for $10 than any other company even comes close to, and at $10 moves it into the category of: "Affordable to Anyone". Is Dynamics 365 Dead? Once again, Mark Smith's ( @nz365guy ) looming prediction that " Dynamics 365 is Dead ", shows more life. While there will continue to be a place for Dynamics 365 Customer Engagement Apps for the foreseeable future, it's no longer the "take it or leave it" product it once was. PowerApps has created a highly viable alternative for many customers... new or existing. If you're interested in exploring this, Forceworks is offering a free Assessment , to help you see if you can take advantage.…
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The Dynamics 365 Web Client is going to be deprecated soon. If you have not transitioned to the Unified Interface, time is running out to be in control of that process for yourself. Maybe there is a reason to look at this "chore" as an "opportunity". Unified Interface The Unified Interface is awesome, a vast improvement over the previous Web Client. Yet a significant number of organizations are still using the Web Client. Microsoft needs you to get off your ass and move. In fact they recently created an Online Community dedicated to this single purpose. In my informal survey of customers who are still on the Web Client I am aware of the following three reasons: Obliviousness, Fear or Money. Obliviousness There are a reasonable number of customers who deployed Dynamics 365 without a partner. Many of them bought the licenses and then went underground on their own, disconnected from whatever may be happening on the surface. Many other customers were deployed by a non-Dynamics partner who likewise is not up-to-speed with changes in the product. There are also customers, as well as partners, who engaged offshore resources or freelancers, most of which are also out-of-the-loop of current information. So in addition to many other things this large customer group is unaware of, the looming deprecation of the Web Client they use every day, is yet another. Fear This group of customers is aware of changes coming to the platform, but lives in fear that their deployment, which they liken to a Rube Goldberg machine, will break if they dare touch it. This group will always wait until the very last minute, which is ironically the scariest and riskiest thing they could possibly do. Their fear is often a result of a lack of confidence in either their own, or their partner's knowledge and understanding of the platform. In other words, they're ignorant. Money Is there a free service that will update you to the Unified Interface? Not that I am aware of. Is it a simple project? That depends, for some users it could be, but for most it will require more effort. Is it frustrating that you subscribed to this product, paid some partner to help you initially configure and customize it for your needs, have been happily using it for a long time, and now out-of-the-blue you have no choice but to spend some money to keep using it? Yes, I would assume that is frustrating. More so if you have no budget for things like this. Opportunity Does this upcoming unavoidable "Effort/Expense" present a possible silver-lining opportunity for customers? Maybe. As a Partner, I often look at changes like this as a good reason to look at what a customer is doing today, vs. what they were doing when we first put this thing together. Hindsight is always 20:20. If we have to crack this thing open anyway, let's go ahead and address some of those issues we discovered after launch, that we never got around to taking care of. At least if the customer has to spend some money for a required change, they can get a little upside out of it. But is there even more upside potential today? PowerApps What if I told you, that while you were at it, you could potentially reduce your license costs by 92%! Is this even possible? You will have to wait for my next post to find out.…
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The ground is shifting under Microsoft Business Applications ISVs. Only time will tell if it is shifting forward or backward. Regardless, to continue existing, you will need to sign a new document, so let's take a look at it. A room full of Elephants Microsoft's new "Business Applications ISV Connect Program" hopes to be a comprehensive program for ISV success, yet it's most often referred to by partners as the "Revenue Sharing Program", due to its prickliest aspect. But sharing 10% or 20% of your revenue with Microsoft is not the only thing you need to understand. In fact, that's probably the simplest thing to understand. Reversals I recently wrote a post highlighting Microsoft's plan to eliminate IUR benefits. In that post I said that I did not think they would back down... and they backed down the next day. I have been assured that this was not to make me look like an idiot. When I first wrote about the new ISV program, I also said I did not think Guggs would back down, and it looks like he is going to prove me right. So I have a 50% accuracy rate on back down predictions! The Addendum Between now and October, ISVs will need to agree to the compulsory ISV Addendum in order to continue to offer solutions (apps) that are built on, connected to, or extend Microsoft's Business Applications platform including Dynamics 365 and PowerApps, and where there is a revenue opportunity, Microsoft Flow. Microsoft Business Central and Power BI are exempt, for the time being. The Whole Truth It's not enough to just review the Addendum, as it references other documents, including the ISV Program Policies , as well as the Publisher Agreement . I am not a fan of spreading terms across multiple documents. The Addendum is 9 pages and the Policies are only another 5 pages, with a lot of duplication between them. Why was this not a single document? This is so they can change the policies whenever they need to, without having to get you to re-sign anything. Classic lawyer games. The Publisher Agreement is an additional 47 pages, but my quick scan of it seems less related to the specifics of the Bizapps ISV Connect Program. So while everyone seems to be focused on a single aspect of this program, let's take a look at some of the other terms of these agreements. I am not a lawyer, but I do know how to read, and I'll share my "Business Owner" interpretation. Tiers Tiers are per app, and while the "Standard Tier" (10%) is compulsory, the "Premium Tier" (20%) is optional... for both sides. While there appear to be some specific requirements, Microsoft has maintained the discretion to accept or deny your Premium Tier request arbitrarily. I expect that this will cause some drama, but I see the rationale. The primary additional benefit of the Premium Tier is the activation of Co-Sell. This means Microsoft's own internal sales teams out there hawking your app, and being spiffed for doing so. Obviously salespeople, and hours in the day are both finite resources that Microsoft would rather not waste on "crappy" apps. But who judges "crapiness"? I would assume that any ISV solution that generates the sale or activation of Microsoft product licenses will pass muster, regardless of its intrinsic value, but what else? What about an app that reduces the need for additional Microsoft licenses? If you determine that you are not getting value for an app from the co-marketing and co-selling motions of the Premium Tier, you can "Down-Tier" that app back to the Standard Tier. It is not clear what percentage you will pay for any deals closed for that app while it was previously in the Premium Tier. Nor is it clear what you will pay for prior deals after you "up-tier" an app. There also does not appear to be any language preventing you from have having two versions of your app, one on each tier, possibly at different prices... I'll let that settle into your brain. What Counts? The definition of a "Business Application", that falls within this agreement is quite comprehensive. It also includes so-called "free" apps, that connect to paid services you offer, so no Trojan Horses. Fees Some math is required to figure out how much you're supposed to pay Microsoft, regardless of the tier. Basically, the total amount of your customer bill, less taxes and "non-recurring" services you perform, and your cost of any CSP licenses you may have included. So this includes your license margin also, if you sell Microsoft licenses as a part of your solution. It really feels and sounds like Microsoft does not think ISVs need to make any margin on Microsoft licenses, and while most don't... some do. It also appears to me to include any and all recurring revenue, like for example monthly or annual support plans, or any sort of managed service type offerings related to your solution. So as an ISV, if I offer a monthly support plan to the customer, I have to pay the fee, but if a reseller of my app offers the same monthly support plan, no fee would apply. The agreement includes this line: " you are solely responsible for End Customer credit decisions and Total Solution Value will not be reduced for uncollectible accounts. " So you will still have to pay Microsoft, even if your customer stiffs you. I have no idea how this is supposed to work in the future when a customer purchases directly via Microsoft's AppSource Marketplace with a credit card. The agreement also includes this line: " You will accurately report each Paid Eligible Sale to Microsoft within 30 days of a Paid Eligible Sale occurring ". Self-reporting always works! Of course Microsoft has the right to audit you, at their expense, and go back 3 years. Interestingly, their audit not only covers fees that may be due to them, but also appears to include your violation of any applicable laws? If they discover anything, you will foot the audit bill. Connect I think Microsoft is going to lose many Connect ISVs right out of the gate. Remember the "Connect" pattern is the one where you already have your own service, and you offer an app to connect it to D365. For example, let's say you offer some deep industry bench-marking service for the princely sum of $10,000 per month. Users typically gain access to your high-value data directly on your secure web portal. As a convenience, you decide to make a small free app, available to your paying customers, that will push your service's resulting "Account Score" field over to Account records in your customers' D365 instances. Guess what? You owe Microsoft $1,000/month for each customer that uses it. The technical definition of a "Business Application", as I read it, would also include third-party published "Connectors", based on what they do, and I am not seeing an exemption for them. So as soon as I wire up the CDS connector to some third-party's connector, is that third-party on the hook for a fee? Or, will they create an exception for connectors? If so, then won't all savvy Connect pattern ISVs just publish connectors instead? Prior Deals For any customers that you may have invested heavily in marketing and selling your solution to, possibly involving significant costs for travel, wining and dining, and ultimately heavily discounting your product to land their "Logo" account, all without any assistance from Microsoft... there is some good news. You have about a year to either raise your prices or decide to absorb the new fees. I assume many ISVs have some sort of term, and the fee will start being due if your customer has to renew between now and next July also. If you have a month-to-month auto-renewing agreement, it looks like you have until about the first of next July. Hopefully, not many ISVs had multi-year agreements with their customers. On the Ball If you sold 100 licences of your product to a customer, and Microsoft began invoicing you for their fee, and later the customer reduced their license count to 50, you better move fast. Your Microsoft fees will not be reduced for any current invoices, or any invoices that were to be sent to you within 30 days. If you somehow mess up and forget to let Microsoft know about the reduction for a while, no credits will be issued to you. In fact, it appears that no credits will ever be issued to you, regardless of... anything. Benefits I found interesting in Guggs' Inspire session , his referring to " access to Microsoft's platform " as a program "benefit". Guggs says he does not like the term "Tax", and I agree... based on this, "Tariff" seems better. This "benefit" had not come up in my past conversations with them for my post about the various benefits ISVs can expect. It looks like the catch-all for anyone trying to avoid the new program. Basically, part of what you are paying Microsoft for, is their permission to play in their playground, that they built, expand and maintain. Microsoft reserves the right to change any of the rules at anytime. So regardless of how much you may have invested to go "all-in" on D365/Power Platform, if you fail to meet some new or changed future requirement... you're out. Summary While I am optimistic about the concept, some of the execution so far feels ham-fisted. The agreements, as you would expect, are pretty one-sided. Establishing a "here's the rules" approach for new ISVs is one thing, simultaneously enforcing a "take it or leave it" approach with long-standing ISVs feels pretty arrogant, even when wrapped in a "for the good of us all" message. While some ISVs may leave, most probably have too much invested and really can't leave, even if they wanted to. Clearly Microsoft's focus is on large ISVs for enterprise customers, as they were the ISVs that were engaged to help craft this. For all other ISVs, time will tell if this is a shift forward or backward. 07/29/19 Clarifications from Microsoft You asked which revshare rate would apply when apps that change tiers. The revshare % is “based on the App Tier in effect when the [sale] occurred” (Addendum, Section 5.a.i). In other words, if an app’s tier changes, the new revshare rate will apply to future sales but not prior sales. You asked whether the same app can have two listings, one in Standard tier and one in Premium tier. While not discussed explicitly, that isn’t our intent and we wouldn’t expect to approve (in certification) the second listing for the same app. You wondered if credit decisioning works differently when customers transact directly on AppSource. I believe it works differently on direct AppSource transactions. With respect to the ISV Connect program, please note that direct AppSource transactions are specifically excluded, since they are subject to different terms and an agency fee under the commercial marketplace agreement. (The Addendum’s definition of a “Paid Eligible Sale” excludes sales “through a Direct AppSource Sale”). Lastly, I wanted to clarify when fees apply on pre-existing deals. On pre-existing deals (i.e., entered into before 7/1/2019 and registered by 12/1/2019), no revshare is due until 7/1/2020. This waiver period also applies to renewals (before 7/1/2020) of these pre-existing deals. In addition, on multi-year fixed term pre-existing agreements with a term that extends beyond 7/1/2020 (without renewing), revshare doesn’t begin until it does renew/extend (even if that is after 7/1/2020). This is the intent of Addendum Section 5.b.…
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In this episode of " Steve has a Chat ", I was able to catch Muhammad Alam before he headed out for Inspire. Muhammad is the General Manager of the Dynamics 365 Finance and Operations (F&O) team, and recently Microsoft Business Central was added to his list of responsibilities. He has been with Microsoft since 2005, so he knows where the bodies are buried. We covered a lot of ground, including these burning questions: Will Microsoft get to a single Cloud ERP Solution? Will Mike Ehrenberg ever let go of Business Central? Why many customers don't even know about F&O. Where do ISVs fit in? Is Dynamics 365 under-priced? The Pain of getting to Single Version. The future of A.I. and Mixed Reality for ERP.…
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I recently tweeted a link to an obscure Microsoft post I found about eliminating IUR. I thought at the time, " this is going to get messy ". I followed up with a post on it myself, which promptly blew up, and now there is actually a petition someone started. Just to be clear... I did not sign this petition, and I will not be wielding any pitchforks at Inspire. Why not? It Had to Happen The vaunted "Microsoft Partner Network"! Wow, that sends chills down the spines of all other software companies! " Oh no! Here comes a Microsoft Gold Partner! We might as well just pack it in, we don't stand a chance ", said Salesforce or SAP never. The ones who are the most impressed by Microsoft "Gold" partners, have always been Microsoft Silver partners. The Microsoft Partner Network (MPN) is a legacy construct, designed for an era that has passed. In fact, I think the entire MPN today is constipated! Wait, I thought you were with us! It seems that many folks read my post and tweets as a rallying cry, but if you re-read it now, knowing that it was not, it will sound quite different to you. This is not the first time I have landed on the bank opposite of the screaming hordes. The recently introduced ISV revenue-sharing model was another brouhaha that most seemed to have assumed that I, as an ISV, would have had a tantrum over. Instead, I was all for the changes. The fact that I have written some rather scathing reviews of things that I thought were dumb moves by Microsoft, does not mean that I think Microsoft is dumb. I am not "that guy", but I have met "that guy". I run into them at every event, and they frequently comment on my posts. They can clearly see the conspiracies that I am obviously missing. Like, how at every event Microsoft has these kids in purple shirts standing around with tablets... appearing like they are giving you directions... but what are they really doing? Back to MPN Microsoft is not good at giving news that they feel will be poorly received. With the exception of Guggs, who seems eager to stick his face into a fire, the rest would rather hide. But just because Microsoft is staffed by chickens, doesn't mean they're always wrong. In fact, over recent years, it would seem that are right way more often than they are wrong. But even though things are publicly looking great for Microsoft right now, there are leaks in the ship. None that will sink it, but if not addressed, they will cause issues in the near future. MPN is leaking like a sieve. Within MPN are a lot of things, beyond just training and competencies. Your MPN membership controls everything about your relationship with Microsoft, or lack thereof. Competencies As far as partners without a competency are concerned, competencies are a shitty way to grade partners. First of all, they are not required. You could well be a highly capable firm with many professionals, selling a butt-load of licenses, but unless you opted to pay the fee, you are not Microsoft competent. Conversely, up until recently, any firm with a handful of people and few deals, could opt to pay the fee and voilà, they're a Microsoft Gold Partner! So basically competencies as they existed, were pretty much a sham. BTW, I am saying that as a current Gold partner, not one of those petty and envious Silver ones. A lot of noise was made recently about the required increases in certified individuals and revenue to maintain a competency, but in reality Gold didn't mean shit anymore, and Silver never did. Microsoft's entire competencies strategy needs an overhaul, pulling the IUR benefits out of it, just stopped some bleeding from a program that was not working... for anybody. 80:20 We're all familiar with the 80:20 rule; 80% of the value that Microsoft accrues from their Partner Network, probably comes from less than 20% of the Partners in that network. Those who are calling for revolt, creating petitions, and threatening to leave the channel are in the 80%. So, on the unauthorized behalf of Microsoft let me say... "Please Leave!". How much more nimble and focused could Microsoft be, if they lopped off the 80% deadwood in their channel? How much time and money could they save, by instead of catering to partners who ain't doing shit, just hitting the delete button? To put this into context, I thought I had heard recently that there were like 600,000 Microsoft Partners Worldwide. Even if that number is way off, how many partners does Microsoft actually need to accomplish their "new" goals? I mean, 20% is still 120,000 partners! Never say Never Satya Nadella himself proclaimed " Microsoft has always been a partner led company and will always be a partner led company ". Hmm... it seems like he should have left some wiggle room there. I can easily see a Microsoft without partners, or at least with a fraction of them. Microsoft itself suffers from Pavlovian conditioning, opening every partner presentation with the obligatory " Thank You Partners! " slide, and then going though a whole deck on how developers are no longer required. Many partners, and all LSPs are basically order takers for Microsoft, while at the same time Microsoft continues to expand it's direct sales capabilities at an unprecedented rate. "Reselling" licenses is a pointless relic in the SaaS world. Lipstick on a Pig I had something great for this heading, but I feel like I am starting to sound like a raving lunatic already, so I will save it for a future post.…
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1 Microsoft to Partners, ”The Free Rides are Over!” 8:59
8:59 Play Later Play Later Lists Like Liked8:59
Play Later Play Later Lists Like LikedThe news media and investor market is certainly embracing the "Softer" side of Microsoft introduced since the appointment of Satya Nadela as CEO. While the company's stock is at an all-time high, it seems Microsoft's network of Partners are being gradually introduced to a new "Harder" side. Update: You can still read this, but Microsoft reversed this decision. Partners Pummeled In recent months, partners have seen a continuous barrage of changes that are catching most off-guard. Many have described some of these changes as types of "Partner Taxes". For example: Mandatory, but unnecessary, requirements to purchase Advanced Support for Direct CSP Partners (Minimum $15K/yr) 10%-20% of ISV's Revenue to now be shared with Microsoft The elimination of Internal Use Rights licenses (IUR), as I was the first to tweet about last week. Add to these, recent changes to the Competency Requirements, tripling the number of certified individuals. It all has a lot of partners wondering... WTF! Let's break it down. The Purge What most of these things will have as a common result, is a reduction in the number of partners. Fewer Direct CSP Partners, fewer Gold Partners, fewer Silver Partners, fewer ISV Partners... fewer partners across the board. It seems that Microsoft is struggling with how to achieve a new goal: dramatically increase the "Quality" of partners in their channel. One part of reaching that goal, is reducing the "Quantity". Quality Partners Ask 20 partners what defines a "Quality Partner", and you'll get 20 answers. But none of them matter, because the definition of a "Quality Partner" is determined by Microsoft, and always has been. Over the years, Microsoft's own definition has evolved, along with changes in technologies. A "Quality Partner" ten years ago, may well be an irrelevant partner to Microsoft today. Irrelevant partners aren't removed from the program, they're just ignored. This is not on Microsoft, this result sits squarely on the shoulders of the partner who did not evolve. Over the years Microsoft has increased the number of their partners significantly, but today they actually see many of them as irrelevant, serving only to boost numbers on brag slides. So why not just remove them from the program? Re-read the first paragraph if you don't already realize that's what's happening. Beauty is in the Eye of the Beholder So what is a "Quality Partner" to Microsoft... today anyway. This will vary significantly from one internal group to another, but it does seem that there are some common themes. The first is that they are usually big. Big partners sell big deals, small partners sell small deals, simple. There are exceptions, small partners that somehow sell big deals, or small partners that sell big logos. Microsoft's only interest in small partners is whether they have the potential to become big partners... soon... and most do not. This is not Microsoft's fault, they are not a charity organization. With success on Wall Street, comes extreme pressure to increase that success, this is all new to Microsoft, but clearly small partners won't cut it. Big is not the only metric, in addition to that, the partners have to be selling the right things, like Azure. If you are not selling Azure today, your relevance to Microsoft is significantly diminished. Again, Microsoft's Azure Powered Cloud is the force-multiplier on their stock value, and there will be no re-trenching. Irrelevance? So, if big Azure selling partners are the holy grail, are all others irrelevant? Not "irrelevant", just "less relevant". Out of Microsoft's 120,000+/- employees, a percentage of them do not have Azure as their highest priority. Although, if you followed the string connected to whatever their priority is, it often eventually leads to Azure, down the road or behind the scenes. If you look at the intentional "culling" efforts underway, it is fairly clear that Big Azure partners are immune. Second to the last Partner Standing If you are not a big Azure selling partner, and you are not able to become one, what is your next best option to remaining or becoming relevant to Microsoft today? You better follow the bouncing balls. Today, it is not important "how" good you are, what is important is "what" you are good at. On my side of the Microsoft house (Business Applications), you better be good at verticals, and migrating customers off of competing solutions. And, if you're not racing towards the Power Platform, you're racing towards irrelevancy. Whatever part of Microsoft's business you're in, you better be listening to their signals. Your agreement with the directions they take is not relevant. Effects of Motions Let's look at what I think the effects will be of some of these recent motions: Increasing the number of required Certified individuals for a Competency. This will dramatically reduce the total number of partners with competencies. Many Gold Partners will become Silver Partners, and many Silver Partners will simply fall off. Is it fair that Microsoft has decreed that your "Competency" with a product (which the dictionary defines as " the ability to do something successfully or efficiently "), is specifically proven by the quantity of certified people you have? Advanced Support Requirement for CSP Partners. Clearly this is Microsoft fixing their own mistake. In their zeal to grow this program initially, they lowered the bar to entry for Direct CSP partners. The predictable result was too many partners who were not qualified or capable of managing and supporting the Direct CSP arrangement. Coincidentally, the vast majority of those were small partners, and what's the best way to shake off a bunch of small partners? Add a significant new cost. It has the added benefit of not appearing like Microsoft took anything away... small partners removed themselves! ISV Revenue Sharing. I already wrote at length about both sides of this coin here and here . Elimination of IUR benefits. This will primarily impact smaller partners, who we have already determined are less relevant anyway. I expect there will be a lot of noise from those small partners, but if a tree falls in the woods... Microsoft won't hear it. This one has some fairly clear motivation behind it. Back in the day, IUR meant giving you a license key to on-premise or desktop software. It may have been foregone revenue, but at least there was no cost to Microsoft. Today, most of the IUR benefits are not free to Microsoft... they have a cost. Imagining the number of IUR services activated across their huge network, this cost is significant. Eliminating this benefit will have the dual effect of reducing costs, and increasing revenue... and who doesn't want that? What does it all mean? If you thought, with the dramatic and rapid evolution of Microsoft from near irrelevance, to the most valuable company in the world, that your life as a partner would remain unaffected... well then you're just a moron. Like Microsoft, you also have to let go of the past. All the old "favors" you racked up, have no value today. The cronies that protected you, are all gone. All of your storied history with Microsoft... pfft! What have you done for Microsoft lately? That is all that matters, and frankly, all that should matter. Microsoft is "Culling the Herd", which by definition means " Literally, to separate or remove (and usually kill) inferior animals out of a herd so as to reduce numbers or remove undesirable traits from the group as a whole ." To me, this sounds like exactly what's happening...…
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1 Data, Data everywhere, but not a drop to drink. 4:08
4:08 Play Later Play Later Lists Like Liked4:08
Play Later Play Later Lists Like LikedOriginally posted on March 7, 2012 Some of you younger whippersnappers may not remember the days when data was stored in file cabinets. That's not a metaphor, I mean actual metal file cabinets. It's true! In the olden days, we used to have rooms full of them. We had a cabinet for employee records, another one for customer records, and others for tax records, financial records, payroll records, marketing records, sales records, active projects records, closed project records, old Elvis Presley records... let's just say lots of cabinets. If I wanted to get an accurate picture of a particular client relationship, my secretary, Doris, would go to about five different file cabinets and copy pieces of paper and staple them all together and hand it to me. Then one day, software showed up and we started keeping records in folders on hard drives. Of course we did not trust software so we still kept records the old way also. ironically, technology actually added to our workload. My, how far we have come. Now we have multiple applications for every aspect of our business, and most of our data today is stored electronically in various databases. There is only one file cabinet left for those items that for some reason we still feel we need a hard copy. We have applications for everything: project management, ERP, Payroll, CRM, Business productivity, website CMS, email, document management, etc, all neatly storing their respective data in various databases and electronic folders. But something else has changed to; now if I want to get an accurate picture of a particular client relationship, I have to do it myself, because Doris has been deprecated :-(. No problem, I am now a technology whiz. I'll just pop open my CRM and click on the client name. Ah, there it is, all of my info on Acme Corporation. There's my list of contacts, all of my marketing letters, all of my communications... wait a minute, where is the info on that project we are doing? Oh yeah, that's right, I need to login to our Project Management System for that... there it is. I wonder how much we have billed this client so far on this project?... umm, where is that information... ah-ha, it's in our ERP, let me login to that. Where is it.... hmm, looking...looking... ah there it is, they misspelled the client name. Wait a minute, this still shows the CEO as Bob, but Bob left last year. CRM shows Bill is the CEO. I am starting to miss Doris. All this technology, and I still have the same problem as before. All these data repositories are the same as the old file cabinets... separate. Suddenly the door busts open and here's this dude in a blue cape screaming "I AM INTEGRATION MAN !". Seriously dude... a cape? "Sorry" he says, and takes off the cape, and sits down and says what I need is to be able to integrate all these silos of data. "Let them talk to each other" he says and I picture my Project Management application hollering over to my ERP system and saying, "Hey ERP!, Bob is out and Bill is in at Acme... get with the program". And ERP says, "oops, sorry, I'll change it so our data matches and I'll also let CRM know when he gets back from the gym". I kick back in my chair and imagine all of my silos of data talking to each other, comparing notes, becoming "one" really, and gossiping about the old metal file cabinet, "those handles are so 70's". I open my eyes and look up to see "Integration Man" putting his cape back on and walking out the door... he turns slightly and I see emblazoned across the back of his cape... "Forceworks".…
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One of the sessions at D365 Saturday Philadelphia this past weekend was "Managing a D365 CE Project" by Jennyfer Hogeland , it was a great session. On one of her slides she described "Definition of Done", and that phrase stuck in my head. Done I don't know about you, but when I hear the word "Done", I assume something has completed. When I am "done" with a meal at a restaurant, they take my plate away, bring me my check, and the wonderful relationship I developed with my server comes to an abrupt conclusion. When the service manager at the car dealership leaves a message on my voicemail that my car is "done", I go down there and get it, and our relationship has concluded, hopefully forever, even though he seemed like a really nice guy. "Done" means something different in the software deployment world. Done times 100 With Agile methodologies, big projects are broken down into smaller parts. Fellow MVP Neil Benson can fill in all the details around this for you, and will probably correct everything I write here. For this post I just want to say, that for each of these smaller parts, there is typically a concept of "Definition of Done". Some people call this "Exit Criteria", which sounds equally terminal. Regardless, if your project gets broken down into 100 parts, you will get to "Done" 100 times. Kind of like when you complete your appetizer, and they take that plate away and put another one in front of you, except it would be a 100 course meal. Done as a Beginning It is not uncommon for a development team to feel they have met the "Definition of Done", only to find that the customer did not understand the definition in the first place. " What do you mean Done? What about xyz...? " It is not that hard to come up with a definition of done that your team understands, it is exponentially harder to come up with one that your customer understands. Their advance agreement is not a reliable signal that they actually understand what they are agreeing to. Why would a customer agree to something they don't understand? Often, it is because they don't want to appear like they don't know what you are talking about. They are content to understand what you mean, after you get there, and then renegotiate if necessary. Done as a Flag in the Ground One of the key advantages to your development team is creating several points along the path where they can plant a flag and say " This thing is done ". It should protect both sides from misunderstandings, or at least limit the damage to either party when there are misunderstandings. If we waited until the end of a year-long implementation to say "Done", all of those misunderstandings will be a wave that will wash over everyone involved. Another fellow MVP Gus Gonzales recently did a podcast outlining these very issues using a real world case... case as in law suit. SOWs When engaging an implementation partner, it is quite common to have your discussions conclude with a "Statement of Work". A typical statement of work will attempt to define the deliverables and the costs associated with delivering them. It may have been created pursuant to a list of requirements from the customer, or several pre-sales phone calls or meetings. The lazy SOW says, "We will deliver all of the requirements from your list, which is attached, for $X dollars." A customer who signs off on that is an idiot, and the project is already doomed. A better SOW does not even reference the customer's list, but rather replaces it and covers each aspect, broken into chunks with a "definition of done" for each chunk. But, I would never give a customer one of these either. In fact, we don't give customers SOWs at all. Why SOWs don't work anymore I think SOWs were always a shitty way to create a contractual relationship, but never more so than today. All SOWs are ultimately agreed to at a "point in time". Back in the day, that point remained fairly static throughout the life of the engagement. Not so anymore, not even close. A month after that SOW was memorialized, new features were released that the SOW did not contemplate. Now what, do we continue down the path, or maybe look at whether any of these new features make more sense for one of more aspects of this SOW we are both bound by? If they do, do we both mutually agree to change the scope. Does that change in scope require a change in cost? Are we going to argue over that because you think I have you over a barrel? Am I going to be a dick about that because I actually do have you over a barrel? If we ultimately agree, what are we going to do next month when it happens again? It is little wonder that so many of these relationships turn out sour in the end, or worse, in litigation. Fed Up Several years ago, I got fed up with the broken SOW process. While I never put my foot on a customer's neck, they frequently assumed I was, because I could. My Dad once told me that, " Leverage always exists, there is no such thing as neutral... who has it at the time, may not be clear ". I can certainly recall being on the phone back in the day with customer making all kinds of demands, assuming he had some leverage, when in fact he did not. It is not a good place for the customer to be, and I did not like it either as you may have gathered from my last post . Our Pivot I decided that we were going to take a business risk, by no longer responding with SOWs... or fixed cost agreements. They create an antagonistic relationship from the jump. Our "risk" was whether customers would go along with the idea. We did not invent this idea, but at the time, it was pretty novel in our space, and still is. We developed a two-page agreement, where customers could pre-purchase blocks of time, the larger the block, the lower the rate. What could be done with this "time"? Anything the customer wanted. We also simplified the tiered rate structure into a single blended rate. The whole concept could be digested in about 3 minutes, without the legal department having to look for "gotchas". Many other partners told me that no customer, particularly large ones, would ever move forward on this basis. They were wrong. Since we launched it, we have helped hundreds of customers, including multiple Fortune 500 customers, and the freaking United States Navy. In fact, there as been virtually no resistance at all. Selling Time Blocks I still had many partners not believing that customers would engage this way, being unable to imagine their customers going along. I have also talked to some who said they tried, and had limited success. Compared to our 100% success rate, I decided that this was a sales problem for these partners. I know their customers would go for it, if they presented it the right way. The key point is that every customer who ever did an SOW or "Fixed-price" agreement was not happy with that model either. That trend is getting worse, which can easily be seen by searching for example " Accenture Lawsuit ". Not to pick on Accenture, their current woes are just fresh in my mind, but SOWs and Fixed-price agreements are ending in litigation at an alarming rate today. How about instead of going down a path with a high possibility of failure, you instead try something that minimizes the risk to everyone. In our case, the maximum size block a customer can buy at one time is 80 Hours. Why? This means that every week or two, we both get to reassess our relationship. While leverage may still exist, it is more equalized. If you are not happy with us, then you can go another direction, the block was consumed, and we owe each other nothing. On the other hand, if you are a raging asshole, once the block has been consumed, I can say adios. But another thing I have noticed in this arrangement is there is seldom a need for the customer to become a raging asshole. In fact, I don't recall off-hand ever saying Adios to one. Agile-ty This concept dovetails nicely into Agile frameworks also. You can't get much more "Agile" than being able to redirect all energies in a new direction when new features are launched or other realizations are made by the customer along the way. No change-orders to argue over, no hard feelings, the river of effort just flows down whatever tributaries the customer wants it to. Hey, wait a minute " Steve, you seem to be glossing over a huge aspect for partners. Where we make the big money is when we come in way under cost, in your scenario this windfall would not exist! " First, I would say that you need to subtract from your windfalls on the winners, all of your losses on loser projects, and come back to me. If you ever chatted to a gambling addict, all they talk about are the times they won. But, if your winners do vastly outnumber your losers in dollars, then you would be right. This model assumes that your customer will actually get an hour for every hour they purchased. Which, by the way, is a other huge selling point! We obviously generate a margin on each hour sold, but there are no opportunities for a huge windfall with this model. Conversely, it is also impossible to end up upside-down on a project. Since customers pre-pay for the blocks, we also have no account receivable department and zero collection effort. A Win-Win? I think so, if the profitability of your business is dependent on windfalls from winners to offset losses from losers, then moving to this model will help you at least sleep. You can also move from having a few key customers who will sing your praises, to have every customer doing so. This certainly makes getting more customers a lot easier. When your prospect asks for a reference, it feels good to be able to respond with: "Sure, how about every customer we have?". I get that this approach is not for all partners, though I am not sure why. I also get that not all customers will go along, but I have yet to run into one. I am happy to discuss with any partner how we make this work, or any customer who wants to explore it as well.…
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1 Are you brave enough to ask your customers how you are doing? 8:57
8:57 Play Later Play Later Lists Like Liked8:57
Play Later Play Later Lists Like LikedI am currently in the software consulting business supporting Microsoft's Power Platform. As you may know, I write about it a lot, but for this post I wanted to veer off a little bit from my typical subject matter. Instead I wanted to talk about customers, and their experiences with companies that provide services. Epiphany I was talking to one of our customer-facing people a few months ago, who was working on one of our larger customer projects. I asked him how things were going. He started to go into the customer's asks, and the hours that had been utilized to fulfill those asks. I interrupted and said, " No, I mean, is the customer happy? " He hesitated, then replied, " I think so ". My brain started churning, "you think so"? Do we know? I came to the realization that I always know when a customer is not happy, because they don't hesitate to let me know. But they never let me know that they are actually happy... unless I ask them. "Fine" Occasionally, my wife will ask me how something like her new hair style looks. My reflexive response is "Fine", which leads to her stomping off and mumbling, " I know what fine means ". Apparently, I do not know what "Fine" means. It seems that it actually means that I am indifferent, which was not her desired response. Whenever I am on the phone with a current customer, I always ask how things are going, and they frequently say, "Fine". Until recently, I took that as a satisfactory response. But actually "Satisfactory", is not a very satisfactory response to that question. "Fine" does not equal "I love you guys!" I think it means they are indifferent to the job you are doing for them, neither dissatisfied enough to get rid of you, nor thrilled to be working with you either. It is a "Neutral" response. Neutral When you put your car in neutral and rev your engine, you go neither forward nor backward. Neutral kinda sucks. While you can know for sure if a customer is not happy with you, you can only intuit whether they are thrilled. But what if your intuition is wrong, and they are only "Fine" with you. Are they going to tell their colleagues about you? Are they going to go to bat for you to stay on the project as it grows or evolves? Or are they going to say, " Eh, they're fine "? Yes, neutral sucks. So how do you get out of neutral? You can Ask Years ago we were brought in by another partner in a P2P scenario to assist with Dynamics 365. I remember some call with me and the partner where he was wondering if the customer was satisfied with things. I said, " Well, we can give them a call and ask? ". He replied, " Hell no, don't ever do that! ". I said, " Why Not? ", and he said, " What if they're not happy? ". Obviously I love to hear that my customers are very happy with us, but the value I receive from that is a smile. The real value is received when they are not happy. I don't like hearing it, but hiding from it is worse. At least knowing, I can take action. If the first time I hear that they are unhappy, is when they take the step of reaching out to me, it could be too late. NPS The Net Promoter Score idea was brilliant. It sums up the health of your relationship with one single question: " How likely is it that you would recommend our company/product/service to a friend or colleague? ". Respondents are asked to rate that question on a scale of 0-10, 10 being most likely. It is simple, and easy for them to provide, unlike a full Customer Satisfaction Survey. From the web:" Those who respond with a score of 9 to 10 are called Promoters , and are considered likely to exhibit value-creating behaviors, such as buying more, remaining customers for longer, and making more positive referrals to other potential customers. Those who respond with a score of 0 to 6 are labeled Detractors , and they are believed to be less likely to exhibit the value-creating behaviors. Responses of 7 and 8 are labeled Passives , and their behavior falls between Promoters and Detractors. The Net Promoter Score is calculated by subtracting the percentage of customers who are Detractors from the percentage of customers who are Promoters. For purposes of calculating a Net Promoter Score, Passives count toward the total number of respondents, thus decreasing the percentage of detractors and promoters and pushing the net score toward 0." Typical Use I think the most common use for NPS is sending it to customers after they received your product or service, and generating a Score from the aggregate results. I am less concerned about the aggregate score, I am more interested in the individual result. I am also not wanting to wait until the end of the engagement to get it. We instituted a program where we ask regularly, sometimes even weekly, during an engagement. It can be automated. Basically I want to take the temperature of the relationship continuously. Once a week, I may ask a customer for a single button press, so it is not a hassle for them to give it. This is part of the beauty of a single question. Hiring How has this impacted our hiring practices? This seems like a left field topic, but actually it is not. We share the customer score with the team member in charge of the project. What do I consider an appropriate response from a team member for a low score? Well, it does not include things like, " It's not my fault ", or " The customer is an asshole ", or " It's okay, I'm billing the crap out of them ". No, I want people who are on the verge of tears when they hear their performance was scored low by a customer. Their tendencies are fairly easy to spot in an interview. Long Game You can no longer build a sustainable business on the "Burnt Bridge" model. Cloud has moved us all into having to think longer term. The old days of trying to get as much revenue as possible, as quickly as possible, are pretty much gone. The new game is revenue generation over time. How much time? It may take years to generate the same revenue from a customer that it took months to obtain in the past. Needless to say, if you are not keeping them happy, you may not been engaged with them for very long. Your best customers are your existing customers, and the best of those are the ones that are happy with you. So you need to be asking, "Are you happy?". Not being asked? If you are a customer, and your partner has not implemented a similar program of regularly asking if you are happy, you are not out-of-luck. You can probably get a similar result by pro-actively telling them on a regular basis. It might also be a good check for yourself. You can set a reminder in your calendar every week to send an email and tell them, "O n a scale of zero to ten, my happiness level with you today is... ". Not only will this usually snap the partner into focus, but it will be a reminder to you of whether you actually are happy with them, or not. Big Partners I would not expect any of the Global Systems Integrators (GSI) to take this path, nor would they likely respond to your initiated "Happiness Notifications". Frankly, GSIs mostly suck when it comes to customer satisfaction. They seem to operate more on a "How hard can we screw you, before you sue us" model. There are plenty of examples in the news today, so I won't go into that any further. Faith Moving to a model, for which the most critical metric is customer happiness, even over revenue, is not easy. If actually requires you to take a leap of faith. Faith that if your customers are really happy with you, that will result in more revenue over time. I also am not blind to the fact that some customers cannot be made happy, they simply will not allow it. Since my goal is revenue over a long period of time, when I encounter these customers, and I know they will not allow themselves to be happy, I will refer them to another partner... maybe a GSI:). Since I can't reach my goals with that customer, I am happy to let them do the battling they crave with someone else. What are you doing to protect your future revenue? Let me know in the comments.…
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What a wonderful invention spreadsheets were. For many things, I don't know how we even managed before them. Okay, I do know, because I am that old... we managed things poorly. Spreadsheets solved so many challenges, that they eventually created new ones. 1-2-3 The first spreadsheet software I actually used was called 1-2-3 from Lotus, back around 1985. I created all sorts of spreadsheets, Shortly after, I switched up to Lotus Symphony, which was basically spreadsheet software with a programming language. With Symphony, I built a complex job-costing system for my business at the time. It was really my first experience as a "Citizen Developer". Needless to say, Microsoft eventually launched Excel, and crushed all of the other spreadsheet applications out of existence. For good reason... it was better. Access Microsoft launched another product in 1992 called "Access". It was a relational database product, and also was not the first. Some users of Excel started looking to Access as a way to build business applications. Access was "accessible", and many "normal" users built things on it. While the term "Citizen Developer" may seem recent, the concept has actually been around for a very long time. Although the tools may have changed quite a bit since then, the fundamental concepts are still pretty much the same today with the Power Platform's underlying Common Data Service (CDS)... a relational database. Fast-Forward Before I put you completely to sleep, let's jump ahead about 3 decades, to today. While the popularity of Access has waned, Excel is still very much alive. If I had to guess the percentage of businesses that use Excel.. I would put it at... 100%. It is simple-to-use, requiring almost no training at all for creating basics lists of information, and basic calculations of those items. Excel's use in organizations is ubiquitous and prolific. It is the "go-to" tool for many users, for almost anything. In fact, in enterprise organizations, I would not be surprised if the number of active spreadsheets in use is in the tens of thousands. Even small businesses often have hundreds of spreadsheets. Spreadsheets have become... an infestation. Infested It sneaks ups slowly. A business or department is formed, and there is an immediate need to capture some data. Who cares what it is, there is some shit we need to keep track of now, and the reflex is to whip up a quick spreadsheet to throw it on so it won't get lost. Makes total sense. Maybe we got a contact page on our website throwing off 5 leads a day, probably going to someone's email box. Let's put them on a spreadsheet and save it as "web site leads", and then we'll just add to it as they come in. Forget about web leads, it could be anything, but this is an easy example. So having these leads on a spreadsheet is good... we won't lose them, but we need to act on them. Next step, send a copy to our two salespeople. Today, you could actually just share it with the two salespeople, but copies are still most often the default. So now have someone updating the spreadsheet daily with new leads, and sending it to both salespeople. The salespeople are getting a daily new copy of this spreadsheet, but they have been taking actions on the last one(s). So they create a spreadsheet of their own to track their activities, and just add to it when they get the daily update. The Sales Manager wants to keep track of what is going on, so she asks the two salespeople to send her their updates daily. She then creates a spreadsheet to consolidate the two she receives. So how many spreadsheets do he have now? To be fair, a lot of this could be simplified using a shared spreadsheet, but still a spreadsheet is being used as a database. 95/5 Rule Excel was not designed to be a database, but rather a data analysis tool. The number of capabilities in Excel are staggering, yet 95% of users only use 5% of the capability. But Excel actually looks like a database table... columns for attributes and rows for records... sounds pretty similar. But used as a database, Excel gets unwieldy quickly. Imagine the scenario I described above growing over time to 50 leads a day coming in, and 20 salespeople. In enterprise businesses, I have seen similar scenarios with thousands of people trying to coordinate a business process with Excel. Excel was never intended to do that. Have you done this? I often see spreadsheets that do not use any of the calculating functions. A tab is created for each thing, like a tab for each Customer for example. On each tab are areas for the customer name, description, etc. Maybe even a running list of Phone Calls or other activities. Basically using a Spreadsheet as a quasi-CRM. I can't say this is stupid; CRM systems have become quite complex and expensive, where spreadsheets are more or less free! Tipping Point When are you torturing Excel too much? I don't need to tell you, if you have read this far your Excel-based system is already breaking down. Sally, looking at the wrong spreadsheet, calls a customer to introduce herself, only to find out that Bob called them yesterday. Bill added a note that someone needs to send Acme a price list, and nobody ever did. Joe adds a new Lead to his own copy, without realizing that Mary was already working on it. The fracture points are various and numerous. When did it start? Actually, when the second person was added to the process, the seeds were planted for it's eventual implosion. But CRM is so expensive! Think ROI It's funny some of the rationalizations customers come up with to avoid a cost. I often hear stories of massive inefficiencies costing customers thousands of dollars, followed by, "Is there a way 5 users could share a license "... to save $160! I get it... you are moving from a shit system, but it's free. But is it free? Have you taken into account anything other than a free system vs a system with a cost? SMBs really struggle with this one, focusing 100% on the possible additional cost. Easily able to ignore the costs they are currently incurring like wasted time and lost opportunities, and in a worst-case lost customers. A Path Forward Microsoft gave you the tool to create this mess, and thankfully, they also created the tools to get you out of it. You need a "Business Application" to replace your spreadsheet(s), we both know that. If you are using Excel, you probably already have other Microsoft products, like Outlook etc, or maybe even Office 365, so it makes sense to look to the same company for a solution to your Excelplosion. The main thing is, that you don't want to find yourself down the road with the same problem. Microsoft has a couple of ways to avoid that happening, Dynamics 365 or PowerApps. Let's unpack them briefly. Microsoft Dynamics 365 This is Microsoft's world-class, enterprise-grade Business Application family. If you are an enterprise, it may already be in use elsewhere in your organization. It competes head-to-head with Salesforce.com, and is a very powerful platform for solving the most complex business processes. If you have sophisticated applications in place already and are looking to move to the next level, this is something to consider. But, moving from an Excel-based system, you could not possibly have been solving enterprise-grade problems, so it could feel like a pretty big hammer. It is a big hammer, and if you are reading this post, you should ignore it completely. Trying to go from 50 Miles per hour, straight to 500 Miles per hour, will snap everyone's neck, and you will be in an even worse place. PowerApps Now we're talking. This is exactly where you need to be going next. It is the most logical step forward from an Excel-based system. It is also significantly less expensive than Dynamics 365, and it's "Citizen Developer" friendly. My choice for moving customers off of spreadsheets is what are called "Model-Driven PowerApps", they are like Dynamics 365's little brother. They sit on the same relational database (Common Data Service) as the monster applications, but without all of the tentacles of complexity. If your needs eventually become really huge, you can easily activate the monster without having to move anything. Back to Access? If you ever worked with Microsoft Access before, PowerApps is kind of like the new version of that, but at the same time, nothing like that. The similarities are that a person with some basic technical skills can build a usable application on top of a relational database. While Access was not specifically designed for non-developers, PowerApps has enabling "Citizen Developers" as a core goal. If you don't have a comfort with basic "techy" stuff, or you don't have the time to mess with it, a partner that specializes in PowerApps can help you get there. Shameless plug: my company, Forceworks is a PowerApps partner, but the army of PowerApps partners is growing fast. Another Shameless Plug As part of our mission to move Excel-based systems to PowerApps, we created an accelerator to help customers get there faster and save some money. We call it RapidStartCRM, and you can learn more about it at https://rapidstartcrm.com . So I think that about covers it, or at least starts the conversation. It's time to stop torturing Excel, and torturing your team... you have officially run out of excuses.…
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So the buzz about the Common Data Service (CDS) has reached a deafening stage. It is the most exciting thing that has come out of the Microsoft Business Applications group in a decade. The possibilities jumped into the category of "endless". So how do you start with something that is endless? Quick Primer I previously wrote about the Common Data Service here, but let's have a quick primer for this conversation. The Common Data Service (CDS) is basically a database that runs under your applications. You can have many applications running on a single CDS, all sharing the underlying data. That is pretty cool. What are these applications? Well, the list is growing, but includes things like Dynamics 365 Customer Engagement Applications, as well as Custom built PowerApps applications. Also, some other apps managed to get stood up on CDS, like Microsoft Forms Pro for example. Via connectors, you can also consume data from over 250 other sources into your CDS environment. Strategies We have what could appear to be an irony here. For the last several years, we partners have been on a mission to eliminate data silos. All of these multiple applications in use with our customers, that not only create similar data in different places, but usually don't talk to each other. There's been a whole lot of copying and pasting going on, which is not only a pain in the ass, but is inherently error-prone. It is not uncommon for an employee to have five applications open to do their jobs, and that's just silly. Part of our mission to date with Dynamics 365 has been to consolidate as many of these disparate applications into a single place. A noble goal to be sure, and a message that has resonated strongly with many customers, who suddenly found themselves sitting on a house of cards. The idea of a "Common" Data Service seems to solve all of that. But Microsoft recently announced some licensing changes, and one of the changes was that you can have as many CDS environments, as you have storage capacity to support. Wait a minute. Are we now promoting silos again? Not Common Think about a restaurant that promotes the "Best Burger in the World"... I want that. You go to get "it" and it's available in 20 variations. So wait a minute, is it the best burger, or the 20 best burgers? You ask the cook which one is the "Best burger", and he says, "it depends on what you like on it, but the beef patty, that they all come with is the best grade beef available". I ask if I can have all of the 20 variations of toppings on one burger... he frowns. But how awesome would that be? One awesome patty, with everything on top of it! Why would I want more than one? Well... maybe because peanut butter and barbecue sauce, while I like them both, don't taste good together? So let's see how I relate this scenario to CDS. Gaining Footing So CDS has been out long enough now for many of us to wrap our heads around it, at least enough to be able to explain it to customers. Now, many of us are actively deploying solutions built on CDS, and we are starting to see the scenarios forming. Scenarios that we had not necessarily contemplated before. For example, I am now being asked questions, that never were questions before like, " For this other department, should we add them to our existing CDS environment, or create a new one? " My knee-jerk response, having been a trained silo-buster, was "add them to the existing environment, or course". But is that always the correct answer? And it if was, then why is Microsoft offering them as many CDS environments as they want? Shared Data Back in the old days, if you wanted two different departments working in Dynamics 365, that did not share any data, you might have used Business Units. Or, sometimes a second production instance was used, but that had a cost. Today, you can have as many environments as your storage will support, so does that change the thought process? Today, my position on this is based on whether there is shared data. If these two departments will be sharing Accounts for example, then my recommendation would be to create a new app for department #2, specific for their needs, but add it to the existing environment. We certainly don't want to have two separate Account tables to deal with. This is the silo busting approach that we have been working towards for years now. So When? When might it make sense to create a separate environment? In my opinion, it is when the users are not sharing any data. This is a frequent occurrence in enterprise organizations in particular. Rarely have I seen HR for example, use any of the data that Sales does. In this scenario, I would take Microsoft up on their offer and spin up a separate environment. Could I accomplish this in a single environment? Yes, but it could get messy, and there is no upside any more. It is hard to completely isolate two apps from each other on the same environment. Changes to one, could potentially impact the other, if you are not paying close attention. Data segregation strategies can also get complex to maintain. Fiddle with a workflow condition for App A, and all of the sudden the records in the App B are doing weird things, if you aren't on your toes. There are a lot of ways to get in trouble if you are not right on top of it... and why bother? Licensing? On the licensing side there seems to be some confusion also, which is not unexpected. Let's say you have a sales team using the D365 Enterprise Sales app, they also have rights to PowerApps. Let's say a part of that team is focused on Lead Generation only, and not Opportunities. Clearly they will share some data, but they have different roles in the process. You can build another app on the same environment targeted to them, and they are already licensed to use it. But let's say H.R. pops up with a need for an app, and they won't be sharing any common data with sales. If those users also have a D365 Sales license, you can spin up an entirely separate environment for them and they can use that. Better yet, if H.R. does not need any of the sales related entities at all, those users could get by with PowerApps P2 licenses and save some money. However those PowerApps licensed users could not use the Sales App. There... that should be clear. Okay, I know it is not clear. Licensing is a tricky thing to navigate, but it is important to understand what licenses you need for what you are doing, or you could easily "over-license". Meaning you bought a license that allows for a lot more than what you need, and so you are paying more than you need to. I have found that Microsoft Support is often clueless to the nuances of licensing, and Microsoft Sellers are motivated to sell the most expensive licenses. Even partners struggle with this one sometimes, so it is definitely not something to figure out on your own. Your best bet is a "licensing knowledgeable" partner, which is also a rare find. I am sure there are other opinions and CDS strategies being used, let me hear yours in the comments.…
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Steve reads his Blog
1 Dynamics 365 Business Central - Is it a SMB Solution? 11:57
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Play Later Play Later Lists Like LikedIt seems that many people are confused about where Dynamics 365 Business Central fits into the landscape. Is it an ERP... a CRM... is it for SMB... Midsized...Enterprise? Is it part of the Power Platform? At the risk of annoying my BC Partner friends once again, I will take a stab at it. Origins It would be helpful to know the origins of Dynamics 365 Business Central "BC", to understand how it came to it's current position, and then I'll discuss it's current position. Once upon a time, there was a product called Navision that Microsoft acquired. There is more to that story, but that is all that is relevant here. That product, since shortened to "NAV", is still alive and well and in use by many businesses around the world. Several years ago, Microsoft started their shift of Business Applications to the cloud, following the tremendous success of Office 365 and Azure. The first product to make that move was Dynamics CRM, and at the time it was launched as "Dynamics CRM Online". Dynamics CRM was not the only business application in the stable, it was just the first to go SaaS. Other products included Dynamics GP, Dynamics SL, Dynamics AX and Dynamics NAV, each of which were different flavors of Enterprise Resource Planning or "ERP". Enterprise Resource Planning is a pretty vague term. It could include human resources, supply chain management, sales activities and many more, but all of these activities revolve around a General Ledger in an ERP system. GL, AR and AP are the common denominators for each of these systems... and every business must have these components. All enterprise sized companies have an ERP, and most Midsized businesses do as well. Smaller businesses may have a solution like Xero or Quickbooks, that fills this purpose at a smaller scale for simpler needs. Many Midsized businesses are also using these simpler products... some successfully, and some who have outgrown them and are considering an ERP. Darwin Darwin's Theory of Evolution by Natural Selection was not conceived for software. But similar rules apply. Basically the strongest will survive. What was strong yesterday, may not be strong tomorrow as the environment changes, and when previously strong players do not adapt, they are replaced by new strong players. This was what drove Microsoft to the cloud in the first place... seeing other players adapt, and become leaders. So Microsoft adapted as well, and given their war chest, they were able to adapt very quickly to a SaaS model. But along the way choices had to be made. One of those choices was, which ERP solution(s) would take the SaaS path. Shifting an on-premise product to SaaS is no small feat, and requires a significant investment. Having four on-premise ERP solutions, it was obvious that all four would not go SaaS. Microsoft drew a line across their customer base, dividing Enterprise on one side and everybody else on the other, and decided to pick one ERP for each side that would go SaaS. Why not just pick one? Well, I didn't have a vote, but I wrote about that here . Regardless, Microsoft selected AX for the Enterprise and NAV for... everybody else. It was pretty hard to argue AX as the Enterprise choice, but there was some debate about NAV vs. GP. GP is much bigger in the US, but NAV is actually bigger globally, so that decision made the most sense.... unless you were a GP partner. Cloudification I won't go into the cloud journey for AX, instead I will focus on the journey of NAV... which actually starts with CRM. Several years ago, Microsoft had an idea to create a specific offering for SMB called "Business Edition". It would be a scaled down version of the Enterprise CRM solution, better suited for the needs of Smaller businesses. Shortly into that initiative, the decision was made that this would be the best place to start the SaaS journey for NAV as well, and thus began the project code-named "Madeira". Given the SMB target segment, this was going to be positioned as a Quickbooks/Xero competing product. Understand that this was well before the idea of a "Common Data Service" was even on the future roadmap. BTW, another product that got it's start in the Business Edition effort was Dynamics 365 for Marketing . About a year into the "Business Edition" effort, Microsoft decided that the path they were on, was not going to reach the original goals as intended, and the goals had shifted as well. CRM itself was heading down a path of componentizing its parts, and separation from its platform... this ultimately led to what we now know as the Common Data Service . But what about "Madeira" and Marketing? Dynamics 365 for Marketing continued it's journey as an independent application, no longer bound by the "Business Edition" limitations. And Madeira? Microsoft Launches Business Central! Project Madeira, similarly became unbound from the Business Edition limitations, and was launched as an independent application called Dynamics 365 Business Central. There are a lot of side routes that this took that I won't go into here. Today, Microsoft Dynamics 365 Business Central is one of the fastest growing SaaS Business Applications in Microsoft's stable. A far cry from my earlier predictions that it would never see the light of day. Maybe the product owner at the time, Marko Perisic, made it successful just to prove me wrong. Nevertheless, it is on fire. So where did it go? Moving Uptown Once the Business Edition tag was removed, Marko quickly pivoted BC from a Quickbooks/Xero compete, into a product those customers could move up to as they outgrew them. While the CRM side of the house was going through a massive evolution into what we now know as the Power Platform, Marko was able to stomp on the gas pedal. BC was evolving at a faster pace than any other product, partly because it was in a lane by itself. Weekly updates were the norm, and the new northstar became NAV on-premise parity. A goal that I believe has been largely met. SMB might be a fine market, but this thing could go way beyond that... in some cases even standing toe-to-toe with AX for some enterprise customers. So what exactly is BC? What is Business Central? At it's heart, Business Central is a SaaS ERP. "Manage your financials" is at the top of the product's page of capabilities. As you would expect from an ERP it has the GL, AP and AR core functions, but it is much more than that. Like everything Microsoft is doing in Business Applications today, BC is infused with A.I. The next listed capability is "Automate and secure your supply chain", that sounds pretty "enterprisy" to me. Next up is "Sell Smarter and improve customer service", so BC also includes some CRM capabilities. After that is "Keep projects on time and under budget", so we can add some project management capabilities to the list. The last item is "Optimize your operations" for inventory and warehouse management. Clearly this product has grown up quite a bit from its humble "Business Edition" beginnings, and there is a growing number of partner extensions (ISVs) to extend the capabilities even further. The pricing is pretty straightforward, at least in comparison to the Customer Engagement applications. There are only three flavors: "Essentials" at $70/user/month, "Premium" at $100/user/month, and "Team Members" at $8/user/month. To figure out which licenses you need, you can review the licensing guide . You can also sign up for a free trial here . From the Pros Since I am not an expert on Business Central, I reached out to two guys who I know are knee-deep in the product for their thoughts. Andrew King is a Partner at WebSan , a Toronto based Business Applications partner. Since WebSan supports both Dynamics 365 Customer Engagement "CE" as well as Dynamics 365 Business Central "BC", I thought he would be a great guy to contrast the two. Andrew shared that there is some confusion in the market, " The products are as different as Golf and Baseball, but we frequently see customers asking about the product that does not meet their needs. Like BC for CRM needs, or CE for Supply Chain. Would they work? I guess if you like playing golf with a baseball bat ". James Crowter is the Managing Director of Technology Management , a UK based Business Applications partner. Technology Management also supports both Dynamics 365 Customer Engagement "CE" as well as Dynamics 365 Business Central "BC", and has a long history with NAV. James talked about the amazing pace of innovation, " I can talk to a new customer in the morning, and have them using BC by the afternoon, which is amazing! For the right customer requirements, BC is a no-brainer... but not for sales workloads, there is not even a workflow capability (for sales), which is a key component for sales!" What Business Central is not? Both Andrew and James agreed that while Business Central is an awesome solution, it is not really a very good Sales tool. Both agreed that they would typically position Customer Engagement for any CRM type requirements, and they often position both products for a true end-to-end solution. They both had some choice words for the Sales Capabilities of BC, and clearly neither one had any interest in activating those, but instead would bring in Customer Engagement for any customers looking to transform their sales processes. So I guess it boils down to, what it is that you are trying to transform. If you are looking to modernize your financial processes, including supply chain and inventory, or have outgrown Quickbooks or Xero... Dynamics 365 Business Central is an excellent option, and you could reach out to Andrew or James for more guidance on that. If you are looking to modernize your sales or service processes, Dynamics 365 Customer Engagement is the clear way to go, and Andrew, James or myself can help you explore that further. But are these the only Microsoft options? Other Big and Small Options If your ERP requirements are really big, and include things like HR management, you might look at Microsoft Dynamics 365 for Finance and Operations . This is Microsoft 's enterprise-grade ERP. Again, we have seen Business Central get into some pretty big businesses, but F&O is the next step up. Conversely, if your sales or service requirements are fairly basic, you may find that Dynamics 365 for Customer Engagement is a pretty big hammer to start with. In that case, you might want to explore RapidStartCRM , our PowerApps based CRM solution. It is an excellent option for small businesses or enterprise departments, built on the Power Platform and running on CDS so you can never outgrow it. Hopefully I cleared up some confusion, but if I actually made you more even confused than before... please keep that to yourself.…
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Steve reads his Blog
1 Dynamics 365 - The Upsides to the new ISV Program 16:05
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Play Later Play Later Lists Like LikedI recently wrote a post about the coming Revenue Sharing model for Microsoft Business Applications ISV's. As expected, there is some screaming going on about forking over some of your revenue to Microsoft. But there is another side of that story... what Microsoft will be doing in return. Recap Starting soon Microsoft will be moving to a pay-to-play model for ISVs. The first reaction I am hearing from many ISVs are various "avoidance" schemes. Remember, this only applies to SaaS products. Since all of these SaaS products are hosted by Microsoft, and they have all the telemetry they want, you really will be challenged to find a way to avoid Revenue Sharing. It is not an "Optional" program. Though for the time being, you can still "side-load" your solutions, Microsoft will easily discover them. When they do, if you are not part of the program, according to Guggs, "If your solution is not on Appsource, we will tell customers not to use it --- we will get very "pointy" with this message over time". I can't think of any intelligent customer who would not heed this warning, so I suggest you drop your "avoidance" plans. Instead, focus on the promised benefits, and maximizing those. Benefits Depending on where you fall, you have several "levels" of benefits across three buckets: Technical, Marketplace and Sales. I'll share the slide first, and then we can unpack these. Understand that these are subject to change, it is a lever Microsoft can use to increase engagement. Starting Level Let's start at left most column, which is the minimum required "non-optional" option. When you publish a Bizapp solution to AppSource, and you commit to 10% as part of that process, this is what you will get, even without selling anything yet: Architectural Consultation. This is a one-on-one consultation with Microsoft. Unfortunately, you don't get this benefit until after you have published, and it probably would have been handy to have beforehand, but I can also see how Microsoft does not want to waste time with tire-kickers either. Training Vouchers. It is not clear how many of these you get, but without a specific ISV Competency anymore, they don't seem like a related benefit, but... they're not worthless. Customer Surfaced Certification. Seems all solutions will have that by default, in order to even be published. Access to ISV Studio. Ok, now we are getting somewhere.. potentially. We are in the Pilot group to help MS figure out what this can/will be. MS mentions Insights and diagnostics, which are important, and we have been missing that, but I think there is more that can be done behind a name like "ISV Studio". Time will tell, but I would keep an eye on this one. The above are all listed as "Technical Benefits", and you may notice that they are the same across all levels. This is where I expect whatever they are planning to do around IUR will probably be differentiated. Today, the differentiations between levels are really around Marketing, (Sales does not kick in until later), so let's take a look at the minimum Marketing Benefits Marketplace Listing Optimization. This is not "prioritization", it is "optimization", but it is important to understand how solutions are surfaced in AppSource so that your wonderful app is not sitting on page 26. This will include a quick consult with the MS Enablement Team, and will become more programmatic down the road. Think, built-in recommendations against what you have done, surfacing Best Practices suggestions. Marketplace Blog/Newsletter/Social. This should not be your entire "Marketing Program". It is a one-time "blast", but can be quite valuable if you time it right, and amplify it yourself through your own social channels. The $50K Club Once your app has generated $50K USD of revenue sharing fees, which is actually $500K of ISV revenue, in a rolling 12 months, you move up the the $50K Club. This is no small feat, if your solution sells for $10/Month/User, you would need to have sold about 4,200 seats. Again the technical benefits, for the moment, are the same. But you do get additional Marketing Benefits, in addition the the entry level benefits, including: Customer Story. This is a basic customer success story that you can create from Microsoft Templates, and submit for publication here . Again, you will want to amplify this with your social channels, but it is a nice "credibility" builder. Sales Enablement. This is a one-on-one workshop with one of the Microsoft vendors who specialize in helping partners build a sales engine. This goes beyond just AppSource and into your entire potential customers' lifecycle. It seems pretty extensive. P2P Consultation. If you are thinking about selling via other partners, this is a roughly 90 minute consultation on how to approach building a channel. Marketplace Category Promo. At the top of each category in AppSource is a rotating gallery of featured apps. Once you join the $50K Club you will be added to this rotation. I would not expect you to show up more than once, and probably for no more than a week. So again, an opportunity to socialize it and direct customers to it, during the time you are sitting at the top of the category page. Social Selling Coaching Program. I have mentioned socializing several of these things so far, to amplify their value. This benefit is a specific, significant one-on-one workshop to show you exactly how to do this whole "socializing" thing. The $250K Club Once your app has generated $250K USD of revenue sharing fees, you have the option to "opt-in" to the 20% revenue sharing model, but you don't have to. Understand that this means you will have sold $1.25 million USD of ISV revenue, which for your $10 solution, means about 10,500 seats. The air is starting to get thinner here, and the numbers of ISVs in this category will be smaller. But if you do get there, you will not only get additional Marketing Benefits, but you will activate the Sales Benefits. The additional Marketing Benefits include: Co-Sell Ready Content. As part of the Co-Sell on-boarding process, you will have the opportunity to add to your seller catalog listing, Seller-Facing content, including one-pagers on your company and application, as well as a Customer Story. These are useful for MS Sellers to better understand what you are solving for, and when and where to position your solution with one of their customers. Mini-Commercial. This is a 30 video in this format . You can add this video to your AppSource listing, and of course. promote it through your social channels. PR Support. This would be a Microsoft distributed press release, that could include a quote from a key Microsoft person who would be relevant to your application. Here is an example . Again, you would be advised to amplify this release with your own social channels. P2P Readiness Workshop. For those ISVs planning on building a reseller channel, this is a much deeper dive than the previous P2P Consultation. It is an extended one-on one virtual workshop, and includes not only readiness, but also introductions to potential resellers. Marketplace Home Page Promo. As a member of the $250K Club, you will also get a spot in the rotation in the gallery for the entire marketplace, versus just your category at the $50K level. You will want to double-down on the social amplification of this as again, you will only sit there for a limited time. However, if you are blowing the doors off with your solution, you may find yourself regularly appearing here. In addition, this level kicks in the Sales Benefits, which are the same as at the top level, so I will cover those below. The $750K Club Let's say you somehow sold $3.75 Million dollars of ISV revenue, which for a $10 app, would mean that you miraculously sold about 31,250 seats. I think it is clear that there are only a handful of these ISVs, and maybe not even a whole hand. But you three will also get some additional Marketing Benefits, that include: P2P Workshop - in person. At this stage you will have already had a couple of consults and workshops on channel building. This takes that up yet a notch further as an in-person workshop at your office. This is going to get very pointy on your specific goals and requirements. Secret Shopper. A Microsoft vendor, who specializes in sales motions, will anonymously go through your entire sales process, including any sales doorways. They will come back with frank suggestions on where your sales process is either failing, or could be improved. Tele-sales campaign(s). Most of us are familiar with N3 , they are one of Microsoft's key vendors for a lot of things. Working with your team, N3 will craft and execute a telesales campaign for your solution. You can target end customers or resellers depending on where you want to create new traction. Telesales campaigns are notoriously hit or miss. It is probably the most overt form of marketing that there is. N3 has been around the block on this, and will no doubt know better than you how to get the most from it. Global Expansion. If you are kicking ass in your region, Microsoft will be eager, possibly even more eager than you are, to spread your ass kicking solution around the globe. Globalization is more than just flipping a switch in AppSource. You will need to deal with the technical side, like localization, but also the introduction to the regional teams in these new geos that may not have any idea what an ass-kicker you are. Microsoft will facilitate this for you. P2P Lead Gen Webinar. Webinars are another tool for building a channel, and Microsoft will facilitate and promote a webinar for you, under their brand targeted at relevant resellers. You will want to drive additional attendance with your social channels. Seller Webinar. These are fun, I have done a couple of them, including one a few weeks ago. This is an Internal-facing webinar that MS Sellers are invited to. This is an excellent opportunity to talk directly to the MS sellers about how your solution will make them more successful. This is less about customer benefits and more about helping the sellers solve their own challenges. So angle it accordingly. These are recorded and added to a library that the sellers can access for on-demand replays. Sales Benefits Once you cross the $250K mark, and you opt-in to the 20% program, you activate the Microsoft Sales Benefits that include: Prioritized Listing. You can be listed of course without being in the $250K Club. But on the MS Internal Sellers view of the catalog, those that opt into the 20% program will be listed at the top. But it's actually more relevant that the sellers will be keenly aware, that if they sell one of these solutions, they will get paid. This is the primary the reason for the additional 10%... to create the incentives to motivate the Sellers to move your product. Think about something like CPQ where there are a few ISV solutions. While the Seller will be able to see all of them, the ones in the 20% category will have a golden glow around them. Obviously, Sellers are going to move forward with one of those first. Co-Selling Support from MS Field Teams. The field teams consist of AEs (Account Executives), SSPs (Solution Sales Professionals) and TSPs (Technical Sales Professionals). An enterprise level customer may have several SSPs assigned to them for different products, like for example, a specific SSP for Business Applications. Tethered to an SSP is a TSP, and together they are the primary force looking to sell Business Applications into their enterprise customer accounts. It is these SSP/TSP combos that you will want to engage with to bring you into these big deals. This is of course assuming that your solution is designed for enterprise customers. Up until now, they received quota reduction for the value of your ISV solution when they brought you in. That was nice, but it's not the same as money in their hands, which they will get from selling the 20% solutions. This is not a guarantee that your solution will be sold in huge numbers... or at all. For many solutions, this path will not actually do anything. In that case you would have to look to the Marketing Benefits to justify your 20%, or maybe you opt back into the 10% tier. Or maybe you did not see enough value, and never opted into the 20% tier in the first place. Regional Account planning with MS field teams. This one is a two-edged sword. You can work directly with the teams to plan how you are going to pursue targeted Enterprise customers together, which is great. But my experience with Account Planning has been that it also creates a reporting burden on your side. Not an issue if it works. A final point on Co-Selling. Microsoft is aligned strategically to industry verticals. SSP/TSP teams are not only targeting particular horizontal solutions like "Business Applications", but they are also segregated vertically along industry lines. For Example, "Business Applications in Healthcare Sector" would be a specific charge of an SSP/TSP team. In addition, depending on the size of the industry, the teams may be geographically bound also, ie. "Business Applications in Healthcare Sector for US East". Basically, there are a lot of people you would ultimately want/need to engage with. Needless to say, horizontal Solutions and "widget" solutions are probably not a good fit for Co-Selling, as should be obvious from what I wrote above. So this was a long post and I am sorry for that. To add to that, everything I wrote above is subject to change as the program rolls out. It may change a little, or it may change a lot, but as I opened with, this side of the program is a lever that Microsoft can easily adjust. For ISVs that are confused, worried, mad or acronym challenged, I am part of another consulting group called PowerISV with four other MVPs who may be able to help.…
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Steve reads his Blog
1 PowerApps Component Framework - Frosting on the Cake 6:08
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Play Later Play Later Lists Like LikedI usually wait a week or two to weigh in on new announcements from Microsoft. I like to let the noise die down a little, and see how others are responding to the news. But I am way too excited about the Public Preview launch of the PowerApps Component Framework . What's in a Name? The journey to Public Preview has been a rather long one. Originally coined the "Custom Control Framework" (CCF), which gave way to another name, "PowerApps Control Framework" (PCF), to ultimately landing on the name "PowerApps Component Framework", this "framework" has been quite the work in process. According to the new Branding Guidance, we are not supposed to use the acronym (PCF) anymore, but whoever decided that, does not write blog posts. Good Delays When PCF was first announced, there was a lot of excitement, among the MVP community in particular. We were all eager to get our hands on this new "capability" that was coming soon... but it did not come soon. It was not because there was any lack of will from the team behind it, rather it was another example of Microsoft seeing an "Opportunity". I recently discussed this "opportunistic re-trenching" that has been going on across Microsoft Business Applications on Mary Jo Foley's podcast . The source of this particular delay, was the realization that if both Model-Driven and Canvas PowerApps could share the same Component Framework, it would be way more valuable to everyone. So one step back was taken, to get two steps forward to the Preview. A frustrating delay for some, but well worth the wait. What the Hell is PCF? Is it charts? Is it Kanban boards? Is it Gantt Schedules? Buttons, dials, widgets, cameras? It is actually a way to create all of these, and many other "components". Is it a "Citizen Developer" capability? No, it is not. Building "Components" is a developer-level job, requiring Javascript/typescript and other development skills. For those of you on the development side, this is the future of what you now know of as html Web Resources... but way better. How is it better? Flexibility, portability and supportability are three things that come to my mind of why this is way better. As opposed to building a hard-coded webresource tied to something, with a Component you can package that up with parameters. This means that your Component is abstracted away from the particulars of a specific environment. For example, during the just concluded "Private Preview", we worked directly with the Microsoft development team to refactor a Gantt Chart Webresource that we had built for a specific custom project management entity in one of our ISV solutions. Our original html webresources were of course hard coded to this entity. The finished "Component" version instead included a parameters capability, meaning we could actually display our Gantt Chart "Component" on anything that met the minimum requirements to display it, which in our case was a start and end date. If additional parameters are present such as predecessors, successors or percent complete, it would take advantage of those also... very flexible. We can install our component solution on any environment, and use it wherever we want. While Citizen Developers may struggle to "build" a component, configuring one for their use is completely within their capability. From a supportability standpoint, since Microsoft developed and owns the "Framework", it falls on Microsoft to handle component lifecycle, retain application business logic and optimize for performance... instead of you. Is this All New? Well, it's new to you, but you have actually been using "components" for quite a while, possibly without even knowing it. Remember the fanfare about the addition of editable grids? That was a "component' built by Microsoft on the framework. In fact, a lot of the features you see in the new Unified Interface are actually "Components", including all of the original charts. What is new is your ability to now create your own components. Who will use this? Personally, I think the largest opportunity around the PowerApps Component Framework is for ISVs. Either building components as part of their larger solutions, or even freestanding components that they might resell individually via AppSource. There is some development effort involved, and I don't see a lot of SIs necessarily learning the nuances of building components for individual end customer needs. Better that they just incorporate components that exist, or will exist in the near future. Of course many ISVs still need to get themselves up to the Unified Interface, but that will happen pretty quickly, or they will be in a world of hurt. Are Html WebResources being deprecated? A common question today from customers and partners, whenever the Microsoft Bizapps team launches something new, is whether the old stuff will go away. Everything you are doing will eventually require change. Microsoft can only advance so fast when they are dragging a big bag of legacy behind them. This was the impetus for the One Version strategy. But even in the One Version world, a level of backward compatibility is a requirement... but for how long. How long will Microsoft allow that technical debt pile to grow? As long as they absolutely have to, and no longer. I have not heard anything about deprecating anything as a result of PowerApps Component Framework. But of course the same could have been said two years ago about other, now deprecated things. Neither the future nor Microsoft is waiting for you.…
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Steve reads his Blog
1 Microsoft steps up to Salesforce’s AppExchange 8:43
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Play Later Play Later Lists Like LikedLet's be real... the Business Applications ISV motion from Microsoft to date, has been a shit show. Many budding ISVs struggled to navigate the program(s) only to reach the conclusion that there was not much there. For all the talk about how important ISVs are, Microsoft's actions to date have failed to live up to their words. I want to personally apologize. The Boy who cried Wolf! I am usually pretty cynical, but over the past few years, I have consistently fallen for the promises from many Microsoft team members, each of whom was independently responsible for some sliver of an ISV effort. Each of them failed to live up to the lowest of promises and expectations. The scattered effort lacked both direction and motivation. Yet, in spite of that history, I continued to get excited about ideas, and shared many of them here with you. If you had taken some of my advice, you to would have been disappointed with the results. For that, I apologize. A Story of Failure AppSource should work... but it doesn't. In Microsoft's zeal to turn it into something big quickly, shortly after it launched, they lowered the bar to entry and it promptly filled up with shit. It remains full of shit as I write this. From apps that won't even install, to some that are downright security risks. Co-Sell should work... but it doesn't. The idea that a Microsoft Seller could actually close a deal faster with an ISV, is not one most Microsoft Sellers have embraced, instead they see ISVs as confusing the conversation and slowing the sale. ISV Competency should work, but Microsoft pulled the pulled the plug on it, only a few months after it was introduced, because they could not remember why the launched it. The very definition of insanity, doing the same things and expecting different results, was fully in-play. The Missing Piece The landscape that I described above, is what Steven Guggenheimer "Guggs" was brought in to fix. Turn this shit show, into a jewel. I previously wrote of my high hopes for this new savior of ISV. Right out of the gate, priority one for Guggs appeared to be, how can Microsoft make money on ISVs. For many, it seemed like adding insult to injury. Seriously, you offer ISVs shit, and now you want them to pay you for that shit! If I were to stop writing this right here, it would not sound very good, but you know I always find the rainbows... Revenue Sharing is Brilliant! Not a novel idea, every other platform has been doing it for years, but Microsoft doing it also, will actually be the best possible thing Microsoft will have done for ISVs. Revenue Sharing is Brilliant? Guggs is no dummy, far from it. He is a no-nonsense kind of guy, that I have gotten know, he was even on my podcast recently. As Guggs surveyed the failures I outlined above, along with the many other failures I did not go into, he spotted the obvious common denominator. He slapped his forehead and said " Holy Crud, we actually don't give a shit! " My dad was my early business mentor, a truly successful entrepreneur. One of the things he would often say in response to ideas that I had was, " There's no percentage in it! ". My dad was not a philanthropist. What he did know, was that without some monetary reward, any business effort would fail. Guggs quickly reached the same conclusion. If you want things fixed, and you want people to give a shit, you need to put a bag of money at their end of the path. Not the only step While reading through the new program documents, it is clear that Revenue Sharing is not the only step Guggs and Team are taking, but it is the only one that matters, and is the single one, that will make all of the other ones happen. It is Pay-to-Play for ISVs now, which may come as an initial shock to many who had gotten used to the free ride. Turbulence Ahead The challenge that Microsoft has with this new effort, is of course, history. For most ISVs, their success has come, in spite of Microsoft. They have learned not to expect anything. I was talking to one of the ISVs that Microsoft often showcases as an " ISV Success Story " today, who told me that Microsoft never gave them anything. No leads, no technical assistance, no sales support, no funding, no... anything. They succeeded completely on their own. It will be a tough sell for Guggs to convince ISVs that they will get a return on this new mandatory cost, and he is well aware of that. Steve Falls for it, Again. The line between "Eternal Optimist" and Moron, is thin. I'd like to think I am the former, rather than the latter. But, up until now, that has not proven to be the case. We transitioned from a mostly SI, to a mostly ISV, because I drank the original Koolaid. Where many of those that did so at the same time, have since abandoned Microsoft as an aid to success, I continued to stay the course, and continued to be disappointed. My gut reaction to the new program announcement was excitement, but then found myself tempering my enthusiasm. Microsoft has also cried Wolf many times. Embrace or Scream The choice of reactions for ISVs will fall fairly clearly on one side or the other. Initially, I expect a lot of them will scream. After digesting the full value proposition, I think a significant number will embrace it. I am embracing it, but I am aware that my credibility on this subject is now dubious. One aspect that I see as key, is with the fact that I will now be paying Microsoft for the privilege of being an ISV for their products, that they "owe" me something. Up until now, the only way to get any ISV help from Microsoft, was to be persistant and super nice and hope that they might throw you a bone for not being an asshole. This "Program" turns the table. In return for my 20% "Payment", (yes, we will be opting into the premium tier), I will be expecting them to step up to the plate, and yes, if necessary, I will be a complete asshole about it. Resistance is Futile For the screamers, I think their screams will fall on deaf ears. I know that some of the bigger ISVs, who like to position themselves as more important to Microsoft, than Microsoft is for them, they will march up the ladder, " You do realize that our solution generates a ton of sales that you would not otherwise see? " This is the anecdotally, hard to quantify argument, that they have leveraged for years. I am sure there is truth to it... but again... hard to quantify. Many of the Bizapps team have proven pliable in the past and quick to buckle under pressure. I don't think Guggs is a buckler, particularly when he knows he is right. "Screw you guys" I'm sure some ISVs will attempt this tactic, but it sounds a little hollow. I mean, where you gonna go? Revenue Sharing is not a new idea that Guggs came up with, it is what the other platforms have been doing all along. In fact, it eerily resembles the Salesforce.com AppExchange model... because it largely is! I would suggest that instead of trying to brow beat Microsoft into some kind of "exception", that ain't gonna happen anyway, you instead hold them to their end of the bargain. I'll go into the specifics in a future post, but based on what I have seen, and been told, if they do hold up their end, this is a no-brainer on ROI, if they don't, you can join me in the asshole club.…
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Steve reads his Blog
1 Power Platform - CDS Explained for Normal People 7:46
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Play Later Play Later Lists Like LikedThere is quite a bit of information in the wild for technically savvy people, around the Power Platform and it's underlying Common Data Service. I want to see if I can make that understandable to us Normal people. Skipping History I know, many of you were thinking, "Ugh, here comes Steve's long, drawn-out 'How we got here' story" . But this is for the normal people, who don't really give a shit how we got here, they just want to know if there is something here they can make use of... or not. Platforms on Platforms In a meaningless to you nutshell, the Power Platform is comprised of PowerApps, Power BI and Microsoft Flow, each of which are kinda their own platforms. Each of these is able, but not required, to run on top of yet another platform, the Common Data Service. Additionally, they can be used individually, or in any combination. A well-known example of a PowerApp, would be the Dynamics 365 Enterprise Sales Application built by Microsoft, but you can also build your own. Multi-View Where this fits, and your interpretation of what I am saying in this post, has a lot to do with where you are. If you are currently using Dynamics 365 it may mean something different, than if you are not. For this post, I want to focus on the person who is new to all of this. Multi-Path You have several paths that you can take with Microsoft Business Applications, which one you take, will depend on what you are trying to solve for, what kind of budget you have for solving it, and how sophisticated your users are. Let's crack them open one-by-one, starting with a critical concept. No Cliffs If you have heard this term, and your name was Cliff, you may have thought you were excluded from playing. But what this really refers to is the idea, that no matter where you start, you can keep going without hitting a wall. This is a pretty unique proposition that today, only Microsoft can fulfill. With most other platforms, you will reach a cliff, a point where you can go no further without switching platforms, migrating data etc. Microsoft Business Applications are used by one-person companies, all the way up to the largest companies in the world. There are no gates, you can start with the simplest need, and keep extending, and extending with no limits. You can literally grow from a one-person firm, to a 100k employee enterprise, without ever having to change platforms. No other vendor can say that today. Big Toys We might as well start at the top with Dynamics 365, a set of world-class, enterprise grade applications that deliver an incredible array of capabilities. From Marketing Automation to Sales Force Automation, Project Service Automation and Connected Field Service Automation, all with baked-in intelligence. No other vendor comes close to what the collective Dynamics 365 applications can bring to bear, on the most advanced business requirements on the planet. While Dynamics 365 applications may be the top of the mountain, they are also the tip of the iceberg. Even these world-class applications are cliff-free with the ability to tap into Azure for even more advanced capabilities, or Microsoft Flow, to connect to vast array of other services, including competing services, who does that? Nobody else does that. Small Toys There is a growing number of enterprise organizations that are making the move to Microsoft Dynamics 365, as well as smaller organizations with complex needs. So if you are not an enterprise organization or have complex needs are you out of luck? Hardly. Microsoft has a path for every business. Let's jump to the other end of the spectrum to Micro-Businesses. 1-5, Make me Alive For a micro-business, I am going to first make an assumption that you are already an Office 365 customer. It's not a requirement, but it is a no-brainer, and opens up even more doors. Personally, I think the easiest place to get started with graduating from spreadsheets, is Microsoft Flow, hands down. A no-code solution for activating automated processes in your organization immediately. Microsoft Flow has hundreds of connections to other Microsoft and non-Microsoft services and tons of pre-built templates. From something as simple as grabbing an incoming email, and auto-replying with a Dropbox attachment, all the way through to multi-step, multi-path, multi-vendor processes spanning your entire organization. Remember, No Cliffs. Mid-Size Businesses Personally, I think the best place for a mid-sized business to start is with PowerApps. A low-code way of building simple to sophisticated apps, that are highly specific to your unique needs. If you want a head-start, check out RapidStartCRM . PowerApps can of course leverage Microsoft Flow, to supercharge your automation, all with no developers required. Level Up Once you have started collecting data and information with your applications, you may want to start adding a layer of intelligence over it so you can really get a tight handle on what's going on. This is where Power BI comes into play. Another low-code capability for gaining insights into your business at a level you probably never had before. Make a Pizza No matter where you begin, you can add any of the other ingredients, at any time, in any order, to any degree. Went big with Dynamics 365 right out of the gate? You can easy add a simple PowerApp for some other department with simpler needs. Or the other way around, started with a simple departmental PowerApp, you can easily add Dynamics 365 Connected Field Service to that. Extending Microsoft Flow with a PowerApp, or extending a PowerApp with Microsoft Flow... all possible, and easier than you think. How did this all happen? The big pivot, that really opened up all of this possibility, was the introduction of the "Common Data Service" (CDS). For most of you, this will be invisible, kind of like the engine in your car. But it is this Azure powered substrate that sits under everything I mentioned above, that lets you effortlessly snap in additional capabilities, and provides this "No Cliffs" evolution. While you don't have to even think about it, it is Microsoft's not-so-secret super sauce, that has competitors either worried, or wanting to join the Microsoft Party. Steve the Shill As I re-read this, I am realizing that I am sounding like a Microsoft Stooge. Really it is just my excitement with the possibilities overflowing onto this post, maybe as a result of my recent Summit attendance and an even further crystallization in my head of the possibilities. I promise, I'll get back to poking Microsoft in the nose... when and if, they do anything that deserves it.…
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1 Dynamics 365 for Marketing - A Giant Tripped by a Grain of Sand 8:49
8:49 Play Later Play Later Lists Like Liked8:49
Play Later Play Later Lists Like LikedMicrosoft Dynamics 365 for Marketing has finally launched! It has been available for purchase since the first of this week. An awesome platform of modern technology, able to do things not even possible before. How many eager customers have clamored to jump on board this revolutionary marketing #FreightTrain of innovation? My guess...none. The Product is... Awesome! Compared to every other Marketing Automation platform out there, this one makes them all look like antiques. Microsoft Dynamics 365 for Marketing is a virtual showcase of everything Microsoft can bring to the table... and most of that, only Microsoft can bring to the table. It is built on the Modern Dynamics 365 UI, it runs on the Common Data Service, it utilizes the Custom Control Framework, it incorporates Azure Customer Insights, it leverages Voice of the Customer and Social Engagement. It makes all other Email-Centric Marketing Automation platforms look naked. More than just Marketing on Steroids, it also includes complete Event Management capabilities. The current list goes on, and the future roadmap is robust. Who was it for? Even the simplest of marketing automation platforms have some necessary complexity in order to achieve results. Successful marketing is a blend of Art and Science, and Dynamics 365 Marketing allows for both. But this ability to blend right brain and left brain creates some necessary complexity. So, it is not for the smallest of businesses. Nor is it for a larger business, with very simple needs. The sweet-spot is the mid-sized business, or a division of an Enterprise business, think 50-500 employees. Certainly there will be use cases for smaller or larger businesses, but this is the wheelhouse. It is also better suited for B2B than B2C. Fortunately for Microsoft, there are a ton of businesses that meet this criteria. The Grain of Sand "Steve, you seem highly impressed, why don't you think people will buy it?" Obviously, a tremendous amount of time, energy and resources were brought to bear by the engineering team in building this marvel. We have been engaged with this team for over a year, and have witnessed them methodically craft each aspect of this product to become the New Standard in Marketing Automation. An incalculable number of man-hours went into engineering this marvel... and then an extra 5 minutes was added to determine the licensing model. Umm.... So I am not exactly sure how this came about. In one picture in my head, I imagine an Intern, we'll call him Justin, who is called into is boss' office and told " Go figure out a way to license this new Marketing app, but don't spend too much time on it, you need to get back to more important things like sorting our partner list alphabetically" . Justin thinks "Hmm.. marketing... maybe I will see how the other marketing apps do this" . A quick scan of the marketing apps that show up in the first page of a Bing search reveals that, many of them are sold based on number of contacts. That makes sense, and 5 minutes later Justin is bouncing back into the boss' office. " Hey boss, I figured out that marketing app thing, we can base the cost on the number of Contacts". "Great job Justin! Now get back to something really important, I want all of the pens in my top drawer arranged by color, starting with blue... no... red". The Licensing Model Microsoft Dynamics 365 for Marketing is available to customers right now. Like many of the Dynamics 365 products, it is available as both a standalone application as well as an addon to other Dynamics 365 products. The standalone version costs $1,500/month, for up to 10,000 Contacts in your Database. You can add increments of 5K contacts for an additional $250/month. When purchased as an addon to an existing Dynamics 365 app, the cost drops to $750/month for those first 10K contacts, and the same $250/month for each additional 5K contacts. In both cases you are entitled to send 10 times the number of emails as your number of contacts. Well, this is indeed a pretty simple to understand licensing model. In fact, it is one of the simplest licensing models that Microsoft has for any Dynamics 365 product. It is so simple in fact, that I don't even need a piece of scratch paper to see that none of my customers could even afford it. Contacts vs Contacts Contacts in competing Marketing Automation Platforms are quite different from Contacts in Dynamics 365. Yes, both records indicate a person, but in one case, the only reason the person is there is to market to them. In Dynamics 365 it is very common that the vast majority of Contacts in our systems are not being marketed to, and never will be. CDS promises to add even more non-marketable Contacts to that database from everything else it connects to, like ERP. Thousands of Vendor contacts for example. I have hundreds of Microsoft contacts. You may have customer contacts in your system that belong to your partners or resellers that you don't market to. Inactive contacts, deceased contacts, competitor contacts, your own employees.. the list is really endless. We have Small Business customers with over 100K Contacts, larger customers could have millions. Let's do some math. Let's say I want to market to 10K people, which is a lot, and I'm gonna bang them with a message 10 times a month, which is also a lot. I already have Dynamics 365 Sales, so $750/month is a pretty good price for me to be this level of annoying! However, I also have 90K other non-marketable contacts. I obviously can't just delete them, so I have to apply a force multiplier to my $750 number bringing my cost to $5,250/month. A non-starter. This is the point where the boss at Microsoft's palm smacks his forehead.. hard. "Justin, you Idiot!" I may be fat, but you're ugly, and I can diet. There is good news here. At least we are not working with a low cost offering that is actually crap. This is an awesome product... with a bad licensing model. Thankfully, this is fixable. I am sure that Microsoft was not counting in their projections that tens of billions of dollars would come in from this. This is a classic unintended consequence of a moronic action. Microsoft is not stupid. Well maybe Justin... and his boss, but everybody else is very smart. Based on their rising stock value, they clearly know how to grow a customer base, and also will recognize impediments to that, like for example an exciting product, that no one is buying. In fact, the simple fix is already within the solution. How it should have been licensed? Remember in the first paragraph, in the litany of features I rattled off - there was one called "Customer Insights". This is an Azure Machine Learning Service that is attached to every Marketing Deployment. What "ultra sophisticated" job does this do? It counts shit. Okay, it does a lot more than that, but counting shit is one of the things it does, in order to do everything else it does. What does it count? Outgoing Emails, Email Responses, outgoing event invitations, event landing page views, etc. It is counting every damn thing. Of the multitude of things it is counting, many of these could be categorized as "Marketing Touch Points". You can probably see where I am going here. Dynamics 365 Marketing should be licensed based on the number of touch points. For example, for $750/month, you get 20K touches, or whatever the math is that makes sense. Associating Cost to Value The current licensing model has no more relation to the value received, than if Microsoft were to charge based on the number of hairs on your arm. A "Touch Based" model on the other hand, is directly tied to the value, at a one-to-one level. I send you a marketing email, boom, I touched you. I am more than happy to pay for that. Like cell-phone minutes, Touches should also rollover for seasonal businesses. Maybe my touches are lighter early in the year, but in November we blow out all our touches for the Christmas sale, etc. Touches are also what drive Microsoft's costs for the service, so they are getting a one-to-one return on their cost. I will now take a bow... {mic drop}.…
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1 Dynamics 365 - Business Central vs. Customer Engagement 8:17
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There has been quite a bit of chatter in the channel lately about this new "Citizen Developer" role that Microsoft is attempting to better support. Not surprisingly, many "real" developers have been none to pleased with the idea. I thought I would try and unpack this sticky-wicket a little bit. New Term for Existing Crowd I'm not sure if Microsoft coined the term "Citizen Developer" or not, but they did recently start using it... a lot. It is primarily used to describe a person at a customer organization who has some level of technology skill, or at least comfort. It could also be used for Partners, who typically have technology skills, but might not actually be developers. These people are not new, they have been around forever, we just have a new term to describe these "citizens". Developers When you think of the term "Developer", you probably imagine some person in a darkened room, typing at lightning speed, what appears to be gibberish on the screen. That is probably mostly true. These would be the people who write code, and can actually read it. Everything that is delivered to you by Microsoft is based on code written by developers. Coding is a high specialized skill, not something you are going to pick up over a weekend from a "For Dummies" book. Developers for Dynamics 365 are typically associated with a Dynamics 365 Partner. So I personally do not think "Developer" is the right term to use for this role, it probably should be "Citizen Configurator". Configurator Even though my auto-correct is telling me that "configurator" is not a word, I am still going to use it, as it is a good description. Configuration generally refers to things that can be done, including vast customization, without needing to actually write any code. You will be hearing terms like "No-Code" or "Codeless" a lot going forward, meaning that you can customize business applications to your needs, within the applications and the options and processes that are available, without requiring the services of a Professional Developer. This is 100% true, but it's not the whole story. Before I get into the rest of the story, why is this "No-Code" even a hot thing? Dam Busting In the not-to-distant "pre-Cloud" past, with Dynamics Business Solutions, if you wanted to do anything different than the way the application was delivered, you had little choice but to engage a Developer. Simple actions on a form often required someone to write Javascript, and it only got more complex from there. Of course before you fully realized this, you would have already purchased your hardware and licenses, so development... was just another expense that you were now committed to. Whatever you ultimately paid, and kept paying, to a developer, did not impact Microsoft one way or the other. Microsoft already got paid for the software, and they did not make any money on the relationship you had with the developer, that was just between you two. However, all of that changed with the Cloud. Microsoft no longer gets paid upfront, they now get paid monthly. Combined with the elimination of your server expenses, your commitment level to using the products is significantly reduced. Instead of having to generate a ROI on the huge upfront investment you made, if things don't feel right for any reason, you can cancel, and are only out a couple of bucks. This new cloud "Dynamic" changed everything... for Microsoft... Partners... and their Customers. Customers are no longer "stuck", in fact, it is the opposite, cloud has empowered customers. But customer empowerment arrived with some unintended consequences. If they discover a high development cost will be involved, they can, and many did, just pull the plug. So, while not entirely eliminating the need for Developers, Microsoft had no choice but to at least attempt to minimize it. Some customers were leaving, and others were not starting, as a direct result of high development costs proposed by partners. Again, costs that did not accrue to Microsoft in any way, but instead got in Microsoft's way. I can't blame Microsoft, I would do the exact same thing. You can't have the channel you depend on to sell your products, be the very reason customers won't buy them. From Balmer screaming "Developers, Developers, Developers", there is now a growing "cold war" between Microsoft and Developers, at least in the Business solutions space. The winner is going to be the customers, and these "Citizen DevelopersConfigurators". Specific Efforts The no-code mindset has swept through Microsoft, and nowhere is it more evident than in the Business Solutions business. Things like App-Designer and the Business Process Designer that sit within the apps, as well as things like Flow and PowerApps that are connected to the applications. The entire Dynamics 365 for Marketing Application, for example, is code-less. Microsoft is attacking every aspect of their business solution applications that typically generate a need for, and cost of, Developers. The only people this is bad news for, are developers, who made a living doing many things that Citizen Configurator can now do. And Microsoft is not finished, they are just revving up this no-code revolution. A Jet gets a Steering Wheel Before we get too carried away with the possibilities... imagining that Dale, who is a whiz with a smart-phone, will suddenly be able to "Digitally Transform" your business on his own, there are a few other pieces to consider. Like... who will be the "Citizen Architect"? Even Developers are typically executing on a plan engineered by someone else; usually an "Architect". Similar to the Architect/Builder relationship in a construction project. While a Builder might construct the staircase, it was an Architect who determined where it will take you. In fact, the most critical key to success with Business Solutions is not being able to build your own Business Process... it is understanding what that Process should be. Microsoft is still quite a ways from everything being push-buttons and check-boxes. But what we are already discovering, are "Citizen Configurators" using what they are able to use, to build overly-complex solutions to problems that could have been simply solved by other means. For some, Flow is the new hammer, and every issue is a nail. I have seen more and more Dales lately; they're building endless loops, dead-ends and forks to nowhere, using "logic-less" logic. Help or Hurt? In this post, I may seem to have gone back and forth on the "Citizen Configurator" role. In truth, it will depend on how a customer uses it. If a customer is of the opinion that these new capabilities will allow them to successfully deploy business solutions without any outside help, they will be in for a surprise. In a worst-case scenario, a customer with no budget, heads down the "Citizen" path, makes a huge mess, and has no funds to fix it. This is not theoretical, it happens all the time. In a best-case scenario, a customer heads down the "Citizen" path, and builds a usable system, that is missing 90% of the available power. "So Steve, you're saying you don't like the Citizen role?" Actually, I am a huge fan. We've Seen This Before Back in the old days, if you wanted a website, you hired a web developer. They would build you a lovely website. Then you moved... and the only person who could change your address on the website was the developer. This "Nickel and Diming" infuriated many. Then along came Content Management Systems (CMS). Now you could easily change your address yourself. But this did not make you a web developer. We have all seen websites out there built by DIYers. Bringing this back to Business Solutions and Dynamics 365, if you truly want to succeed, you will need a team. On this team should be a Dynamics Partner who can not only "Architect" a solution to actually solve your needs, but can bring in development expertise where it is the best option. "What about Dale?" Dale is absolutely a key member of this team. Thanks to Microsoft, some of the things that only your partner could help you with in the past, Dale can now do as part of the team. Will this dramatically reduce the cost of Deployment? Over time, as Microsoft makes more tools available for the Dales, deployment costs will come down. You will always need an Architect in order to get maximum value out of the vast palette of Dynamics 365. But today, Dale should at least be able to limit the nickels and dimes.…
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Steve wrote about CDS for Non-Techies recently, in this podcast, he reads that post to you.
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Redefining AI is the 2024 New York Digital Award winning tech podcast! Discover a whole new take on Artificial Intelligence in joining host Lauren Hawker Zafer, a top voice in Artificial Intelligence on LinkedIn, for insightful chats that unravel the fascinating world of tech innovation, use case exploration and AI knowledge. Dive into candid discussions with accomplished industry experts and established academics. With each episode, you'll expand your grasp of cutting-edge technologies and ...
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