To understand the direction Microsoft is moving with its Dynamics 365 platform, you have to go to 2014, when CEO Satya Nadella was put in charge of the company. One of his primary goals was to take a larger share of the CRM market, where Microsoft currently sits fourth behind leader Salesforce, Oracle and SAP.
This process -- and progress, according to analysts -- was multipronged, starting with better alignment with Microsoft's existing business applications, namely Office 365 and Outlook; adding cloud hosting with Azure and business intelligence with Power BI; continuing the Microsoft-Adobe partnership; and acquiring LinkedIn, both of which added significant value to the Dynamics 365 platform.
The Adobe partnership was announced at the annual Microsoft Ignite conference last year. For Microsoft Ignite 2017, analysts expect the Adobe partnership to deepen and possibly expand, and for the LinkedIn purchase -- which was announced but not yet finalized during last year's conference -- to play a more significant role. The conference, located in Orlando this year, takes place from Sept. 25 to 29.
"If Microsoft was just going to try and replace existing technology in the ERP and CRM market, it would be a pretty difficult battle," said Kevin Armstrong, vice president of Microsoft Sales at Tribridge, a technology services firm in Tampa, Fla. "For Dynamics 365 to take hold, Satya had to change the vision of Dynamics, and the direction has been fast and impressive."
Building on the Microsoft-Adobe partnership
Microsoft has been tight-lipped about any announcements ahead of Microsoft Ignite 2017. Unlike Salesforce, which had its CEO Marc Benioff take the lid off the Einstein announcement prior to Dreamforce last year, Microsoft keeps its news closer to the chest, only teasing out the news of a partnership last year, before announcing the relationship with Adobe at the conference.
Session descriptions for the upcoming conference do mention the possibility of further Microsoft-Adobe integrations or products.
There is some joint go-to-market efforts and selling across [Microsoft and Adobe].
Michael Fauscettechief research officer, G2 Crowd
"We share current and upcoming capabilities, including demos of integrations between Adobe Campaign, Adobe Experience Manager, Dynamics 365 and Power BI," one description read.
Adobe recently announced new features for email marketing in its Campaign Manager, which is part of Adobe Marketing Cloud, one of the main products Microsoft is partnering with to better provide marketing capabilities for its enterprise-sized customers.
"The thing about Adobe in the digital marketing side of the house is they've had this reputation -- this 'cool' factor -- for Adobe's marketing suite," said Michael Fauscette, chief research officer at Chicago-based G2 Crowd. "There's a cache about that integration and capabilities that Microsoft doesn't have."
Fauscette said he also believes that Microsoft and Adobe could be gearing up to go to market together on joint product offerings -- an attractive option for Microsoft-heavy shops looking for better customer and marketing management.
"There is some joint go-to-market efforts and selling across companies," Fauscette said. "I think there is some economic advantage selling directly, versus a referral partnership."
Further integration with existing products
Microsoft wasted little time integrating Dynamics 365 with other in-house business applications and putting them on the same common data model -- a big computing advantage, according to Armstrong. But further integration with Microsoft's host of products could still be beneficial, and some of that could be unveiled at the upcoming Microsoft Ignite conference.
"I'm a big believer in Microsoft's move toward machine learning and AI with Cortana," Armstrong said. "The biggest advantage of having all this data in one solution is leveraging Cortana to look at the data and tell us things about our customers or prospects. The reason that's important is you're not talking about integrating with [AI], you're talking about interacting with it."
Microsoft hinted at new tools for innovation around Dynamics 365 at Microsoft Ignite 2017. Building off its integrations with its existing products and expanding to others -- like Cortana and Power BI -- could provide some of those new innovations.
The LinkedIn whale
Microsoft's acquisition of LinkedIn in 2016 was arguably the biggest tech splash of the year, with the Seattle-based company spending $26.2 billion on the professional social network. Yet at last year's conference, there was little official discussion about the capabilities and integrations on the Microsoft side, as the sale was still under the approving eyes of the Securities and Exchange Commission (SEC). After the sale was finalized a couple of months later, Microsoft continued to say that the LinkedIn and Sales Navigator tool APIs would remain open for all to use.
"Microsoft is trying to do two things: one is leave LinkedIn and their tools in their existing position -- keep them Switzerland," Fauscette said. "At the same time, Microsoft wants to integrate them more deeply in the background so that if you're a Dynamics customer you can get an advantage of using it."
Still, analysts see an advantage for Microsoft having LinkedIn in its stable of products with the capability of baking its features directly into Dynamics 365, rather than a third-party integration that other CRM companies have to do.
"Anytime you have separate systems combine, you have potential for connection points to break," Armstrong said.
It's unlikely that Microsoft spent $26.2 billion for an existing revenue stream, but it also can't use LinkedIn as a proprietary product without upsetting the SEC. However, Microsoft users should expect enhanced features moving forward with LinkedIn, and the first tidbit of those features could be heard at the Microsoft Ignite conference.
Next Steps
People-centric Office 365 features address info silos
