Introduction

As a cloud CRM user, it is important to understand the differences in your Customer Relationship Management (CRM) system licensing models and how these are evolving and changing and for many vendors gradually moving towards a consumption model in many areas, particularly in data storage.

This post delves into the Dynamics 365 licensing model as illustrative, although the principles and takeaways here are becoming more and more relevant to many of the core Cloud CRM vendors such as Salesforce, Hubspot and PipelinerCRM*.

Now, cloud benefits are now well known and widely accepted, such as:-

• Always on, often 99% plus availability 365/24 is built-in

• Fully managed back-up

• No hardware costs or maintenance

• Sandbox available for development

• No set-up or installation cost, just buy and configure to meet your requirements.

• Established eco-systems of linked 3rd party apps and partners

• Office 365 and Email such as Outlook integration

Finally,

• Regular upgrades built-in

This last item is one of the keys to cloud CRM success. Your software is now always up to date. The key is often there is now for most vendors a major upgrade release per year and for Dynamics 365 there are two major feature releases per year, Spring and Autumn now known as Wave 1 and Wave 2, this compares to perhaps a major release at most once a year, but usually every 2 or 3 years for more traditional on-premise solutions.

However, with these benefits, there are also new challenges and new ways of working.

Managing your Subscription Footprint

What do we mean by footprint? When you move to a cloud licensing model, the old one-off purchase of software has been made redundant, now you buy on a subscription basis, typically either every year or every month depending on the CRM vendor licensing model you have adopted.

For most Dynamics 365 clients I work with, they have adopted the CSP (Cloud Service Provider) model where their subscription costs are calculated and invoiced monthly on the actual licence assigned.

This is an important point for Dynamics 365 clients. Since you are paying for your licences monthly, so you are able to flex these up and down on a monthly basis.

During the Covid-19 pandemic, this has been very useful since many clients have either had redundancies or have had people move onto furlough and have been able to reduce their licence count temporarily or move Users to a Team licence rather than a Full licence, saving themselves significant amounts of cash.

Part 1 Dynamics 365*

Understanding licencing models

With Dynamics 365, there are two core licences*:

• Full Licence. This has all the key user and full access rights.

• Team Licence. Typically for those users need more read only or limited usage rights, for example Senior Managers, non-business line staff.

*(there is also a Device licence, but this doesn’t concern us here)

You may also have other additional licences on CSP model, so for example Power BI for reporting /Business intelligence purposes and Power App licence for those users perhaps just performing a set of simple tasks and who don’t need full access to CRM. Whilst not the subject focus here, again, understanding types of licence and what licence is required can save you money.

Now a short note on Database Storage.

In 2019, Microsoft introduced a new data storage model, based on three core elements:

• Database. This is typically where most of your data is stored so consideration here would be based on number of user and amount of information per record plus number of records.

• Files. This is where files and attachment are stored.

• Log. The manage say an audit log of events, changes e.g. change of owner etc

For each Tenant, you have a 10Gb core storage Database capacity plus the number of Users you have adds 250Mb storage per user on these Database element and you can purchase additional storage. However, the price for this Database storage increased from around £3 to c.30 per Gb, so this is now an important consideration. This is further complicated by clients perhaps have multiple instances all using up this storage capacity, for example a sandbox instance for developing and a sandbox training. All these consume from the overall allocation.

Whilst sandboxes are critical, each time you create a new one it consumes a minimum of 1Gb. And whilst File and Audit storage is a lot cheaper, this still needs to be managed as it contributes to the overall total.

Reviewing this situation on a regular basis, at least twice year should be part of your standard procedures.

I have seen examples where this storage can become a big problem and needs to be addressed, for instance where Test databases containing data are not reduced or cleansed after Go-Live or where there are multiple sandboxes for test or training databases being used. After Go Live, you need to review this to pre-empt future problems and potential bills.

By monitoring this now, you will be able to build a picture of how much data, by type is building up on a monthly basis and can start to plan and forecast for the future.

This year may be particular relevant since many of you who have taken on Dynamics 365 subscriptions may be coming to the end of any fixed pricing and by taking action now, you may avoid an unpleasant surprise later in the year, which although well forecasted, may have been forgotten in the current turbulence of the pandemic impacting workloads.

Conclusion and key takeaways

The key thing here is to be aware that you need to be regularly reviewing your software subscription, not just on Dynamics 365 but on other applications so you can flex. This is very important on the CSP or monthly pricing, whether this is for Dynamics 365 or your Office 365 subscriptions.

My key five takeaways are:

1. Audit and review every 6 months at least. Include your Users licence mix, their usage and the storage capacity and growth by instance.

2. Monitor your usage of the system. We have number of reports that can form a template for most Dynamics 365 systems and be configured for your own system. There are also MS standard reports on usage.

3. Review sandbox size and number. Do they need all the test migration data in them still? Can you revert to the core?

Finally,

4. Review Microsoft Licence guides or speak to your technology partner for up to date advice. Microsoft seem to be issuing new licencing guides at the moment every 2-3 months, so you need to be up to date. Book in a Licence and Storage Review if in doubt

We have come across reviews where we have been able to recommend moving users from Full to Team licences with little effort saving clients over £60 per user per month! So, the key and final 5th takeaway is if in doubt, always speak to your technology trusted advisor.

ENDS

* Part 2 Salesforce et al. Having re-read this, I have decided it is probably better to look at Salesforce and other apps in a separate post so as not to confuse the issue here, but the key point to bear in mind is that many of the principles may still apply.