Making Leaders Successful Every Day

Optimizing Dynamics AX Implementations

2013 Forrester Research, Inc. Reproduction Prohibited

Companies are gearing up for innovation and growth

How much of an impact do you believe the following changes and initiatives will have on your firm's IT services spending over the next 12 months?

Moderate impact
The need to innovate and grow our business The need to lower our IT operational costs Senior business management's conservative approach to spending on large projects The increasing use of smartphones and tablets, as well as the apps on them Consolidation of business units or streamlining operations The increased use of software, infrastructure or business process asa-service offerings Business executives taking a more active role in the provisioning and decision-making for technology and IT services The need to grow/expand the business in new geographies and developing countries The increased reliance on predictive analytics to help inform better and timelier business decisions We are bringing in new, smaller, more innovative vendors to help us implement new technologies
Base: 1,058 IT services decision-makers Source: Forrsights Services Survey, Q2 2012

Significant impact 50% 42% 31% 37% 34% 28% 21%

35% 37% 41% 34% 34% 38% 38% 24% 26%

30%
28%

17%
10%

Make your spend count: spend on innovation and business value Spend on operation and maintenance vs. innovation Average performers -- the IT spend iceberg

35%

65%

Step 1: Get current on your version of Dynamics AX

Technical upgrade to reduce maintenance and support costs Functional upgrade to improve business value Move away from extensive custom code revaluate need for this and
look to leverage a more vanilla Dynamics AX
Look to out-of-the-box best practices

Upgrade to a current version to be able to leverage new features and

add-ons

Step 2: Optimize Infrastructure and Maintenance Spend And Value

Consider instance consolidation if you are fragmented Move to virtualized or cloud models to gain economies of scale Centralize support and management functions

Step 3: Evaluate your sourcing strategy

Evaluate whether an outsourced or managed services model would

generate cost savings and potentially business value

Cost savings can be on the order of 20% to 30% or higher Look for outcome-based contracts on better service but also on
business value

Leverage the providers' economies of scales Evaluate offshore or other low-cost delivery options --- look for lower cost
labor pools

Evaluate productized IP and solution accelerators that can remove cost

Plan now for future growth and needs

2013 Forrester Research, Inc. Reproduction Prohibited

Major technology forces maximize and extend ERP value

2013 Forrester Research, Inc. Reproduction Prohibited

SaaS alternatives drive agility and speed to value

How important were the following benefits in your firms decision to use SaaS?
5 - Very important factor 4 (On an importance factor of 1-5, 1=Not at all a factor) 39% 34% 29% 28% 35% 20% 24% 24% 17% 14% 11% 25% 23% 22% 28% 24% 23% 32% 35% 32% 25% 33%

Improved business agility Allows us to focus resources on more important projects Speed of implementation and deployment

Faster delivery of new features and functions from SaaS/as-a-service providers

Lower overall costs Ability to substitute upfront costs with regular monthly payments To support a large number of mobile and remote users Lack of in-house IT staff to maintain a traditional software solution

Gaining a feature or functionality that is not available in a traditional, licensed software package Iterative deployment model supports a higher level of innovation within the business Having access to a wide ecosystem of solutions around the core SaaS application

Base: 920 packaged application decision-makers

Source: Forrsights Software Survey, Q4 2011

Maximize ERP value by extending to the cloud

Add-on technology areas that surround core ERP

HCM CRM Collaboration

Two-tier ERP with cloud-enabled ERP in divisions or regions

Faster time to value Greater ongoing agility

Cloud-enabled technology for test/dev or pilots

Quick spin up of new solutions Scale up / scale down for spikey workloads

Full ERP suite deployed in the cloud

Still a growing area but more organizations moving in this direction Software vendor solutions and partner- (ecosystem-) enabled

2013 Forrester Research, Inc. Reproduction Prohibited

11

Most firms have not yet implemented advanced analyticsyet

What are your firm's plans to adopt the following business intelligence and analytics technologies?

Implemented, not expanding

Expanding/ upgrading implementation

Reporting Web analytics (e.g., analysis of Internet/web page traffic) Dashboards

21%

36%

27%

19%

15%

27%

Performance analytics

15%

21%

Embedded analytics (e.g., within ERP, CRM)

16%

19%

OLAP (AKA 'slicing and dicing' analytics)

11%

16%

Base: 1,631 software decision-makers from firms with 20 or more employees who are involved in packaged application software decision-making Source: Forrsights Software Survey, Q4 2012

BI Tops The List Of Software Priorities For The Next 12 Months

Which of the following initiatives are likely to be your IT organization's top software technology priorities over the next 12 months?

Increase our use of business intelligence, analytics, and decision-support tools and services Upgrade packaged applications to a newer release

45%

20%

46%

16%

Increase deployment and use of technologies Use custom development for better business support and/or differentiation Invest in mobile applications for employees, customers, or partners Increase the use of enterprise app stores to improve end user service and support Increase our use of open source 25%

46%

14%

37%

17%

39%

14%

6%

21%

5%

Base: 2,444 software decision-makers Source: Forrsights Software Survey, Q4 2012

Analytics unlock the value in ERP

Massive amounts of data collected but many firms are stuck at basic
reporting / minimal analysis

Competitive and market dynamics compel firms to invest in better, faster,

data-driven decisions

Analytics and BI can unlock the value put information and

recommendations into the purview of business stakeholders

ERP users seek KPIs and best practices from vendors and partners

2013 Forrester Research, Inc. Reproduction Prohibited

14

Mobility extends ERP to real-time data and decisions

On the go access to data customers,

employees, inventory

Real-time updates back into the ERP system

Rather than waiting for the daily / weekly updates from ERP users

Real-time alerts inform ERP mobile users of new

developments
Change in customer status Cancellations or reroutes of appointments Manager approvals

Mobility solutions from software vendors and

partners
Industry-specific Cross-platform, support for multiple devices

2013 Forrester Research, Inc. Reproduction Prohibited

15

Best practices to maximize value from ERP and ERP services partners

2009 Forrester Research, Inc. Reproduction Prohibited

Forrester's Criteria For Vendor Selection

Capabilities
Competency Strategy Technology Methodology People Specialization (Industry, Domain) Relationship Cultural Fit Innovation Results Execution Case Studies

Cost
Innovative pricing models (skin in the game) Pre-built solutions / accelerators Solution models Contractual flexibility

Market Presence
Revenues Growth FTEs Partners

Pre-built solutions speed time to value

20% to
30%
Time and cost savings by using pre-built solutions and accelerators Encapsulated industry best practices

Clients seek embedded KPIs and benchmarks to drive business value Data proliferation creates new
challenges for clients to drive value out of sourcing information

Embedded KPIs and benchmarks can

provide new insight by industry, LOB, or category

ERP program managers can give

business stakeholders greater value more strategic business alignment

Move from reactive to predictive -identify new opportunities for value with the business

Critical Internal Factors For Success

1. Executive buy-in and sponsorship

Senior and clearly defined sponsors who can evangelize and drive the change and secure funding, from start to finish

2. Strong governance internal and with partners

Daily, quarterly, and annual meetings Detailed escalation paths Named executives and RACIs

3. Change management
Detailed organizational readiness assessment Focus on change management throughout the organization Champions as well as drivers

Recommendations
Examine accelerators, tools, and templates that speed time-todeployment and reduce implementation cost and risk. Look for industry and application knowledge relative to your specific business needs. Look for providers that will bring their own best practices rather than work with you to develop procedures. Look for client references with similar needs/goals and make sure to interview them

Thank you
Liz Herbert +1 617 613 6011 eherbert@forrester.com