CfMD & Repeatablitiy

For some of you the Azure post yesterday might have come as a surprise, as my dissappointment.

About a year ago, we (the PRS team) started to evangalise about repeatablilty. This was one of the main pilars of our story about programming "nicely".

For years, or almost decades, Navision and later Microsoft have struggled with the repeatability story and making the ISV/VAR story a success.

When I started with Navision they introduced the idea of Add-Ons and verticalisation. The idea is that rather than having NAV partners compete with each other, have them be specialist at some area of industry. This worked like a charm when it started in the late 90's. Everyone was busy and had more than enough customers, so if someone approach you asking for a certain solution, rather than developing it as customisations, you'ld point them to another partner and vice versa. This is how I rolled into the Transportation business where I still am active today.

But somewhere after this it stoped working, or something else happened, I don't know. The unofficial numbers of "vertical" solutions registered at Microsoft that I have heard at NavTechDays is 30.000. Yes, Thirty-Thousand.

You can imagine that these are not everyone daily sold. Not even yearly.

So for the last couple of years Microsoft has tried to clean this up in several ways, but the last one is quite effective I think.

The Certified for Microsoft Dynamics "logo" was introduced some years ago to allow customers to differentiate between all these add-ons and pick the most successfull ones. If you were CfMD a partner had privileges on the Microsoft website and so forth. The hope was also that partners would start selling other CfMD solutions rather than reinventing the wheel, but still you are allowed to sell any add-on with the same commecial conditions as a CfMD product, so that kept on happening.

The big difference between NAV partners and Microsoft is that they have different pillars that drive their business. Microsoft drives sollely on license revenue, new and maintenance, while partners have a big income from implementations.

A NAV partner can sell a license worth perhaps 25.000 euro's but 250.000 euro's worth of implementation and development. Microsoft only gets a percentage of the 25k. So the difference here is 5% vs. 100%. The idea is not to spend the 250.000 euro's anymore but sell vertical solutions worth 75.000 euro's. Here everyone is happy and the partners can do more. This is emphasized by the limmited development capacity that has been hunting the Navision channel as long as it has been existing. The simple rule of thumb is that if we had 50% more developers we have 50% more projects. This will dramatically improve if we do repeatable business.

This does not mean that there are no partners that have made this work. There are partners that sell there solution 20 times per year globaly. But not as many as we should have.

So what's the catch here. I guess my PRS friend and colleague Gary Winter has explained it very well during our presentation at NAV TechDays.

If you want to sell your add-on with NAV2013, you need to sign a new contract with Microsoft. This contract requires CfMD. If you are not CfMD you can still sell your Add-on but you will simply get one invoice each quarter as if you sold the solution. Weather you have a customer or not. And for the Retail object price (with partner discount).

CfMD requires you to have a number (let's asume 10 or so) customers on the current and previous version. So if you never sell your add-on, or only once or twice per year, you are in deep s**t.

But wait. This is not it. This story would not be complete without the Azure story. Microsoft, Kirill Tatarinov anounced this himself on Convergence 2012 that Dynamics NAV will run on Azure in complete multy tenacy mode. This means multiple customers on one database.

As you have read in my previous pust, this has not happened. In my next blog post I will explain a little about Azure and Multi Tenacy technology and explain why this also have a next major impact on the need ot repeatability in Dynamics NAV.

Cheers, and thank you for reading...

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