How much will my Microsoft Dynamics NAV implementation cost?
December 16, 2016 11:31 am
NB: This piece also applies to Microsoft Dynamics 365 Business Central. Dynamics NAV is the former name of this solution.
The success of a major software implementation relies on the working relationship between the client and the software partner. Realism and honesty on both sides are vital if the project is to come in on budget and deliver the required outcomes.
The client must be honest in terms of what the software is required to achieve. The partner must be honest and realistic in describing what the software can deliver.
The greatest source of unexpected costs and budget over-runs are that either the client adds extra functionality as the project progresses or the partner has been ‘economical with the truth’ on what the software can deliver in an attempt to compete on price.
At the initial stages of the project, TVision ensures a well-structured, realistic and robust budget is established. To do this we make sure we understand exactly what the client wants the software to achieve and the client understands exactly what the fully implemented software can be expected to deliver.
We are always looking to deliver a long-term relationship with a client and keep this very much in mind right from the first discussions about a new project. What IT can and can’t deliver can be a confusing area, so we keep everything transparent. We follow an implementation methodology that locks down a go-forward budget after the initial analysis phase is completed. Project management and strict change control procedures are essential in ensuring that projects are delivered to meet all expectations, including budgetary.
In defining the go-forward budget, there are three areas to consider
- the software licence cost
- maintenance and support
- implementation services
Please contact us at TVision for a no-obligation discussion about what you want to achieve from your Dynamics NAV implemention project
Microsoft Dynamics NAV – Cost of the Software
The Known Knowns There are two ways of paying for software, on-premise or in the cloud. On-premise, or a hosted solution, means the client pays a monthly subscription and installs it on their own server, wherever that may be located. The alternative is subscription based cloud licensing. Historically, the majority of ERP implementations have been on-premise. The advantage of on-premise is the control of both security and performance. Some of this is undoubtedly emotional and as people feel more confident in consuming technology on a rental basis we expect the demand for subscription based implementations to grow.
The Starter Pack
The starter pack contains core functionality addressing business processes for accounts and distribution. It also includes three full user licences. This means a small company may only ever need the starter pack, enabling Microsoft to boast that companies can get up and running for less than £3,400!Extended Pack
The Extended Pack provides further functionality, addressing areas such as manufacturing, full jobs/projects and CRM. Please note that this means CRM within Dynamics NAV not Dynamics CRM. Our article Microsoft Dynamics NAV v Microsoft Dynamics CRM explains the differences.Full User
A full user is a concurrent licence that can access all the system although the individual user may be restricted through the permissions associated with their log in.Limited User
A limited user is a concurrent licence that can read all of the system but can only write to a limited area. Again, the individual actual user is restricted through the permissions associated with their log in. The Known UnknownsAdditions to the Microsoft Dynamics licence
All implementations need to include the Starter Pack and any additional full user licenses. You may also need the Extended Pack and we can advise on this. Also consider how many limited user licenses will be needed. As a guideline, limited users are usually people who perhaps 10 years ago would not have been given access to the ERP system as it simply wasn’t cost effective or necessarily very helpful. With the development of ERP software, it is easier to give more access to more employees. A common split across an organisation is usually around 60% limited users to 40% full access users. Two common extensions to the basic functionality are- Jet Reports, an Excel plug-in that interrogates NAV data from Excel
- Continia document management and capture
Additional cost will be involved if a project requires significant development although this is becoming less and less likely as the functionality within Dynamics has increased. As the most flexible ERP system in the mid-market sector, it continues to attract those whose business processes are niche or even unique, as well as being an excellent fit for more standard enterprises.
All implementations rely on application objects, the building blocks for developers. These include blank tables, reports, pages, codeunits, dataports and XMLports that need to be purchased for any development. The standard licence comes with a reasonable allowance so extra cost is usually only a consideration when a project requires a significant amount of bespoke work. While it is not possible to know exactly how many objects are required until detailed analysis has been completed, TVision is very experienced at successfully estimating the likely requirement once we are familiar with a project.
Any change in scope of a project will always impact the budget for the software license, whether to increase or decrease it. This is such a transparent area that usually gaining approval for such changes is an easy argument.
