Steve reads his Blog

My thoughts on the current state of this competitive battle.

I caught Charles the other day for my fifth annual Chat. We talked about many things fresh off of Ignite—copilots, of course, but also Project Sophia and his thoughts about AGI.

Are You Straddling Outbound and Real-Time Marketing? Listen to this.

The final episode in my series, How AI Could Kill Us All

Part 7 of my series, How AI Could Kill Us All

Part 6 in my series, How AI Could Kill Us All

Part 5 in my series, How AI Could Kill Us All

Part 4 in my series, How AI Could Kill Us All

Part 3 in my series, How AI Could Kill Us All

Part 2 in my series on How AI Could Kill Us All

Part 1 of a series on How AI Could Kill Us All

Part 7, the last in my series of Sally and Power Platform

Part 6 in my series of Sally and Power Platform

Part 5 in my series of Sally and Power Platform

Part 4 in my series of Sally and Power Platform

Part 3 in my series of Sally and Power Platform

Part 2 in my series of Sally and Power Platform

In this mini-series, we will follow Sally from HR as she uses the Microsoft Power Platform to solve business problems. eAF5xMHH8UDyTnylK4y1

  I had a chance to sneak up on Vahe Torossian, a Microsoft Corporate Vice President and the man in charge of Sales for Microsoft Business Applications. While Vahe has been with Microsoft for 30 years, many of you may not know him, so I wanted to fix that. Vahe is no ordinary Seller; he's the “Top” guy who sets the sales strategy and motions for the entire global team. Vahe is also the guy who runs the really big enterprise customer meetings, and he's super-friendly, as you would expect for the Chief Rainmaker. We covered a lot of ground in this one, so enjoy! Transcript Below: Vahe: Hey, Vahe Torossian speaking. Steve: Vahe, Steve Mordue, how are you? Vahe: Hey Steve. In fairness let's say Charles mentioned that somehow you were going to call me. I didn't know when, but it's great to talk to you. Steve: After I interviewed him, I asked him who would be a good person to talk to? And he dropped your name. So it doesn't surprise me that he gave you a little heads up. Have you got a few minutes to chat? Vahe: Yeah, of course. Thanks Steve. Steve: Oh, perfect, perfect. So before we get into it, maybe we can tell the listeners a little bit about what your role is. I know you've been at Microsoft forever, I think like 30 years or something like that, and you've held a lot of different positions. But now you're in the business application space and that's been fairly recent. So there's probably a lot of folks that might not be familiar with you, who should be. Vahe: Oh yeah, thanks Steve. You're right. I've been celebrating my 30 years anniversary at Microsoft in April in 2022. I actually took the helm of the Biz Apps sales organization globally in late 2020. So basically I took my one way ticket to Redmond in December 2020. And the plane was almost empty, it was during the pandemic. And it was kind of a strange feeling for someone who has been traveling so much in the past. And of course, let's say I came with the lens of the business application, of course. Having led let's say Western Europe in my past role, having all the businesses of Microsoft. And I think Western Europe was quite successful on Biz Apps, our trajectory growth. And I guess that was also in fact the good match to some degree to try to take it at the global level. Steve: So is it a little easier to think about a smaller segment of the product mix, now really being able to focus like a business application? So I think before you were looking over all sorts of different things, weren't you? Vahe: Yeah, actually it's a great question. Because I think it's very different way of looking at the business. When you are, let's say almost you are the CEO of Microsoft in the countries that you are, let's say leading. You have all the levers to engage customers, partners, government, in different circumstances. And you try to leverage as much as you can the portfolio that you have to maximize the value. In the context of let's say the business application. I think it was, the interesting bet to some degree Steve, was to say, Hey, this has been a portfolio at Microsoft, whether you call it Dynamics 365 or Dynamics only as a brand in the past. And if you go back 20 years, let's say almost, with the Navision and Axapta, and Solomon Software and Great Plains. All these stories, all these product came together. And 20 years later, I think it has been part of a portfolio somewhere. Vahe: And you had almost what I will call the strong, let's say, portfolio of Microsoft, the platform, the modern workplace and environment. And I felt the work that James Phillips in the past, and with Alyssa, and Charles, and Amy here now on the marketing side. Have been a strong inflection point to bring together both the technology in the cloud environment. But at the same time, a market environment that requires very different, let's say tools to make the most of this transformation. And I felt that there's one piece at Microsoft that requires a huge catalyst leveraging the innovation. But responding as much as we can to what the customer need or even don't know yet what they need. And I think that's what I think to me was almost a bet. It's almost like all of a sudden you move to the little dog, if I may say. But with a huge potential of transforming something with great asset for Microsoft, and the customers and partners. Steve: Well I have to say, having been involved with Microsoft for a while, we have a phrase over here called redheaded stepchild, which is kind of what Dynamics was for many, many years. It was off campus, it was just this thing out there and under Satya, when Satya came in, he's the first one that I think came into the position that recognized this should be another leg on the stool, not some remote thing out there. And I think that's made a huge. Difference because I was involved in the years before Satya with business applications and they were not just something over here on the back shelf, and now they're right front and center. I think that between Dynamics and what's happened with the power platform, cloud in general. Microsoft's ability to get into and help customers is massively different than it used to be. And in your role now, you're dealing with a lot different type of customer. You're talking about Office 365 or Azure, you're dealing with IT. And now you're mostly dealing with business users. It's a completely different audience you're having to work with today, isn't it? Vahe: Absolutely. I think also you're right since Satya took the helm of the company, to some degree you of course we have seen how we tackle the cloud computing hyper-scale environment. But at the same time, in fact what happened with the Covid in the last two years, have seen an acceleration of what we call in the past, the productivity tools to become more and more collaboration environment. And from almost an application or a set of application, it became more and more a platform on its own. And so it's almost like when you think about where we are today and we were talking about the Covid, I don't think the Covid is yet over fully everywhere. But now everybody's talking about recession, right? And there's no one headline that you look, you say, oh my goodness, what's going to happen? Which just means in terms of planning for 22, 23. Vahe: So I think the assets that is now quite unique to some degree, or differentiated as you said, between the Dynamics 365 platform components and the Power Platform, it's almost bringing together. But I think, I don't remember Steve, in a few years back, I think Satya was talking about the mobility of the experience. And that was more from a device perspective initially. But actually what you see now is that with Teams as a platform, the system of productivity almost connect with the system of record more and more. And it's re-transforming the way you are thinking. It's almost like, you think about, you don't have to go to a CRM environment or ERP environment to get access to the data. It's almost like wherever you work, if you use an Excel or if you use Teams or whatever, you get access naturally, almost intuitively to your data set. And the data set are that's almost fulfilled naturally. And so we have no additional task. Vahe: And so I think that's the transformation world in which we are. Which connects cheaper well. We almost do more with less, right? And that's going to be almost the conversation we're going to have in the coming month. And it started already with many customers and partners. How we can optimize the assets that they have, how they can let's say increase the deep provisioning of some assets that they have. They are paying too much to concentrate a bit more, to get more agility. And I think this is where also, from a partner perspective, Steve, I see a lot of potential. You are referring to Power Platform, it's fascinating to see what it was in the very beginning, this notion of citizens developer, what does it mean? Vahe: People didn't know exactly what it is, we're quite afraid to touch it. But now when you see the shortage of developers in the market in general. And how you can make the most of some absolutely topnotch people who are not developer, touching the last mile execution challenges. Have been facing crazy environment and situation that they say, I can't believe how my IT guide doesn't solve these things. I've been telling them the customer pain point for so many years. And now with some, let's say [inaudible 00:08:45] place, let's say available for them, along with some let's say technical assets, you can really make the magic in the very, very, very time. Steve: Charles came up with a term on the fly, ambient CRM. Kind of where we're heading here when you talk about things like Viva Sales and some of these pieces that are really wiring all these components together. Covid was a terrible thing, but it certainly was a perfect storm for pushing the technology forward into a place that it's been fighting to get to, it's really been fighting to get to that point. And Teams was a great product. But certainly Covid created the perfect environment where Teams made insane sense for companies that were maybe just thinking about it or dabbling with it, and suddenly they're all diving into it. And you guys of course poured the investment on top of that. And I think that the silver lining of Covid, for technology, is how far it really allowed it to advance in that period of time. Maybe we just need a pandemic every five years to push a technology forward. I don't know. Vahe: No, but I have to say that even in my previous role when I was running Western Europe. Even the most skeptical people in regard to the cloud or the transition to a cloud environment. Having the one that rushed in the first, almost to a cloud environment, once the pandemic has been a bit of a real situation to face, and to drive the economy or the public services let's say on. So I think you're right, so you don't want to wish for another pandemic or whatever, but it has been absolutely a forcing function in many domains. And that's true. Steve: I think the challenge we have is particularly in the business application space. You guys have launched so many things in such a short period of time. And as you mentioned before, Power Apps, people picking it with a stick, they don't even know what it is. And there's also this first mover fear, I think. Microsoft has been, in my mind, kind of famous for coming to the game late and then just taking over the game. We were very late to the cloud, but once we got there we just took over the cloud, and it seems to be a pattern. But when you look back at the early days of cloud before you guys stepped into it, it was wild west. And all sorts of challenges with cloud. And I think that that gave a lot of people fear about, I remember I moved into cloud early and we got destroyed. Steve: And so I think there's a lot of folks out there, just from a technology standpoint, that have gotten their hands burnt by moving too quickly. And we're at that point with the platform and dynamics, where these are not new anymore. Relatively in history, they're new. But they're not new products and they're not built by some garage shop somewhere with a couple of developers. This is what 15,000 people building this stuff back there. This is professionally built, well built stuff, that is ready for prime time. So the first movers have already come through and they all survived. So I really feel like we're at that point where it should just take off now, it should just absolutely take off. And I'm sure you guys are seeing this. Vahe: Yeah. And Steve, I think one thing also is that you're right, there's a usual thing about let's say the first mover advantage. At the same time from a customer perspective, you don't want to be the Guinea pig, right? On any situation, especially from the technology standpoint. I think that increasingly what I see in the conversation is that there's almost now, because of the quality of the native integration of the several different applications. Whether you are in the customer experience environment, on the service side, on the supply chain, on the finance or the local no code or app. All these components are absolutely connected to each other. And basically whether you have Teams as a platform in your company, or Azure in environment, all these component are connected very, very easily to each other. Vahe: And so I would say that the beauty of it now is that you have all almost the notion of marginal cost. If you really want to leverage many of the assets that we can bring, and you don't have to take all of them at once, of course it has to be matching what you need now. But the right is that, let's say there's an almost fully integrated benefit all the connectors with the rest of the world outside of Microsoft environment, which is a great value for the partners, ISV and [inaudible 00:13:58], and at the same time to the customers. Who think now, hey I should do more with less. How should I think about my investments for the next, let's say five years? Most of the customers now are really thinking about the longer term relationship. And defining what's the value SLA almost that you're expecting both from the partner of the vendor and the vendor itself. Vahe: And so it's almost like, you remember when we transition from a world of build revenue and licensing, to now more consumption and usage. It's almost the user and consumption discussion is a forcing function about the customer success, how we align on the same definition of the customer success. And what's the time to value that you committed? What are the key milestones, in full transparency, that you need to bring in? And I think that's where we are now. And because Microsoft, I think overall as a company, have been increasing tremendously the level of trust. From the security standpoint, the compliance components, and so on, and the scalability. Vahe: I think that's the great leverage for us now in terms of the conversation and making sure that the customers are getting the value that we have been selling to them. How we show how much skin in the game we have to make them successful. And then it's a flying wheel. It's almost like the innovation will help you to bring new things, respond, anticipate, take the feedback of the customer to the engineering, develop new stuff quickly to the market. So I think it's what we are heading to now, Steve. And I think from a partner perspective you might even see and feel it, right, more and more. Steve: Oh yeah, I mean I think the sales motion has changed completely. Only a few years ago we go into a customer and try and convince them to replace Salesforce with Dynamics. And they'd say no, and we were done. We'd say okay, well we'll come back in a couple years and ask again. We had nothing else to sell them. And now today, I mean if they have Salesforce, fine that's great, keep Salesforce, let's add some things around it. Salesforce will work with Viva Sales, Salesforce will work with Power Platform. Steve: There's so many doors now, I think, for a seller to be able to get into a customer and solve problems for that customer without having to do the one big yank and replace. Which is very difficult to do, it's difficult to do on opposite as well. I mean once a customer gets a big solution like Salesforce or Dynamics 365 installed, those are very difficult to uproot, it takes a very long time. And you guys have created now, this product mix, where we don't have to uproot something to sell that customer and to get engaged with that customer. We can go all over that business without having to uproot something. And I think that's huge. Vahe: I agree Steve. And I think that it's almost this notion of rip and replace type of strategy, right? In some cases it works because this is what the customer wants. They are fed up about let's say competitive environment that didn't deliver on the expectation. And we should be ready to cope with that and respond, and we have a lot of this. But at the same time as you said, what we call the strategy of having a hub and spoke, let's say, almost environment, gives us for every line of business. That we decided as a company to go and have a significant acceleration of growth and market share, is very much to give that option to say, Hey, you know what, Mr. Customer, Mrs. Customer, you decide to be on that type of environment, who we are to ask you to change? Vahe: If you are happy that's fine. But what we can bring you is almost to enhance what you have with some component that absolutely will be transparently integrated to what you're using. And it's a great circuit, an additional circuit for the partner, it's a great value for the customer. We don't feel harassed to change something because we know the cost of transitioning from one to another one. And then it's up to us to demonstrate the value we can bring and eventually we can take from there to the next level in the future. Steve: It's got to put some pressure on the competitors also. I if think of, I might just use Salesforce because they've always been the big competitor. I'm sure that they were confident sitting there at their large customer when all we had was trying to replace their instance that was going to be difficult to do and then we'd go away and they didn't have to worry about us. Now we're coming in and we're circling around, and we're solving problems in this department, and we're building apps in this department, and we're literally bolting into Salesforce. And one potential outcome is that the customer decides over time that wow, all of this Microsoft stuff that we've brought in works really, really well. Steve: That's gotta put some pressure on the incumbent big application in there that hey, you're surrounded by a bunch of stuff the customer is very happy with, you better make sure they're happy with your stuff and they don't reach that point. Cause like you say, oftentimes when you see those rip and replace, it's because the product, or the company, or something hasn't met the expectation. And to be fair, that could actually happen with any of us, right? It has a lot to do with implementation, design, how thing was put together. Less to do with the application itself, that could happen to any vendor. But certainly raises the bar to some of these competitors when they're surrounded by well performing Microsoft products that are satisfying customers. Would you think? Vahe: Yes. Absolutely. And that's why there's a continuity between what we sell, how we sell, to who we sell, and how we drive the implementation. It's an ongoing wheel that is a very different mindset that we all learn in the transition to the cloud, let's say, environment. But absolutely. I think it's a good forcing function to raise the bar to some degree, raise the bar for the benefit of the customer. You mentioned the competitiveness of what this type of hub and spoke strategy can create. You're right. But in the end, the biggest, let's say winner, will be the customer, right? Which I think is always and should always be the north star for us and our partners. Vahe: And I would say the relevance of the innovation should be in fact the pressure that we put to each other to make sure that say we listen carefully to what the customer is facing as a challenge, but potentially to translate their current challenge into the future challenge, to push them also to think differently. Because I think the notion of rip and replace [inaudible 00:21:06] One of the thing was, I don't know if you remember that the initial issue and worry was that people were saying Oh, we are moving to the cloud, therefore we are transforming. Well it was not that tried and true. People were just keeping the same processes in the cloud and the one that they had on premise. Which was not benefiting at all of the scalability and the agility of the cloud environment. Yeah, you remember that right? Yeah. Steve: They just changed the way they were paying for it. Vahe: Absolutely. Absolutely. So I think that's what we have seen on this application modernization, on some of the enterprise wide innovation also opportunities that we had discussed, is how much you can really say, in this new world of competitiveness, of un-expected challenges. How you can, let's say, keep your applications fitting always in fact proactively the challenges that you're going to have too. As opposed to keep going with a quite heavy code to maintain, with people who leave that cost you a fortune to maintain. So I think this agility that the power apps, [inaudible 00:22:22] to made, have been bringing I think is the reason why we have seen this huge acceleration of growth, which is today is six, seven times faster than the market growth of local no code. Vahe: So I think it's a great, let's say indication, of what people start to realize. And I think in the conversation that you had with Charles when he was referring to, hey some of the AI capability have been slower to be picked up by the vast majority of customers. And it's true because there's a level of, let's say, can I trust this thing? Am I going to lose completely ground and control of what I'm doing? All these natural thing. I think as we bring more and more, let's say tools, are manageable. The Power Platform environment, or let's say the device sales capability on top of the teams or Salesforce environment. That people will start to test this. Vahe: And I think we're going to be more and more advocate about Hey, what are the benefits of the organization that are using this technology and how we can trust them lean forward. And I think Charles was referring to our digital sellers. Their daily life is very much, let's say, using all these AI lead capabilities in terms of reporting, in terms of let's say incident management, in terms of even coaching for themselves to do a better call next time, is just fascinating to see. Maybe we should even do a kind of, let's say talk on this, once we have a bit more, let's say after the GA, maybe a few months after, we should have, let's say what the key learnings and [inaudible 00:24:00] from a customer standpoint. Steve: Yeah, it always makes a customer confident when they know that the vendor is using the product that they're trying to sell them. It's interesting, everything moving to a subscription has changed kind of the mindset, not just of you guys obviously, where there's no big sale. There's a sale of a big subscription, the revenue of which will come over a long period of time. But the customer has this option every month to say, you know what, I'm not happy, you're not solving my problem. In the old days they were kind of stuck, they bought all this stuff and they had to make it work. Now they don't have to make it work, we have to make it work, we have to keep them happy enough. Steve: We recently launched a professional services on a subscription, which is an interesting model, that I lay awake at night thinking about that same thing. That before a customer would pay you a bunch of money to a bunch of stuff and now they're paying you a little bit of money every month for as long as you keep them happy. And this bar of, I mean we've always wanted to keep customers happy. But it's never had the impact or importance that it does when you're on a subscription with that customer who can just any time say, “I'm not happy, goodbye.” It raises the bar I think for you guys to have to continuously innovate, what do you done for me lately? You got to continuously innovate and bring new things. And you've got more motivation probably than the company's ever had in history because of the subscription model. Do you feel that internally? Vahe: Yes, yes. As I said, it has been a great enabler to raise the bar. And it's almost like you know can have a beautiful slide deck and saying the right things, but the execution doesn't match what you are saying somehow, that you don't walk the talk. I think you could have been in that situation in a kind of on-premise environment. I think the cloud has been a forcing function to say, hey you know what, you can claim you are customer success, or you are customer first, or you are customer obsessed. But the reality is that if you don't deliver the service properly, if you are not as responsive timely, if you're not proactive, customer will say enough is enough, I can stop my subscription. Steve: I have options. Vahe: I have options. So I think it's a good hygiene, how it makes you having an embracing habits, that I would say are the natural thing when you engage with customer. But I think it's almost, let's say, for the one who might have forgotten that basics, it has been a great, let's say, opportunity to bring back the roots of what is it to satisfy a customer, right? And I think that's what the cloud licensing model helped put together. And I think there are still always room for improvement. Vahe: And similarly I would say, what you have seen on the collaborative applications, what we have seen on the low-code, no-code, you are going to see it now, also I would say on the supply chain environment, which is shipper, shipper at stress because of what we have seen on the Covid, but also in fact on the geopolitical aspect and some of the recession discussion. And also, on the overall, what I would say the contact center in our environment at large. How this world is going to change is going to be led a lot by the capability that technology can bring, and the ability to listen carefully to the strategies and the challenges of the corporation that are involved in. So it's quite exciting actually. Steve: I don't get involved a lot with the call center operations. But I picture the old call center is this massive building full of cubicles and people with headphones. And I picture that now that most of those people are probably working remote. A call center now could operate at my desk, just about, and have thousands of people all working from their home. So, that whole industry feels like it's changed significantly. And yes, I'm sure they're starving for the technology that fits the model that they're being pushed to adopt. Vahe: Yeah, yeah absolutely. I mean it's interesting, if you summarize some of the business challenges or the things that are coming from multiple conversation. We had the nuanced [inaudible 00:29:04] a few months back. And so it's almost the first fiscal year where we're going to be able to strategize, operate together as one organization. And it's great because somehow you take their own experience in terms of conversational AI and what they have been leading in for many years. And at the same time you hear both, let's say, the customer feedback when it comes to, as you said, the traditional contact center or call center evolution. How to translate this into a modern service experience, right? Vahe: And how AI can contribute to that on the seamless integrated way. How to think about customer retention in this world where people are a bit more struggling with their bottom line. How to protect the customer privacy as well. Because you talk about voice capability and recording, but how you cope with the privacy and the security during this service journey. So all these are absolutely great opportunities for us to combine what we're hearing, the technology and the acquisition that we did a few months back, to put that into a great component. And I would say the data analytics that the power Platform Power BI gives us on the back end, is going to be a great platform for us again to differentiate from the rest of the world. Steve: Well and it'll also help kind offset the fact that these people are all remote now, right? They used all be sitting in this big room. And people were standing up there looking over a rail at them making sure they were doing what they were doing and available. And you can't lose any of the customer service quality just because you've moved everybody out of the building and nobody can physically see them anymore. AI is the only way to plug that hole really of being able to know what's going on in this organization with all those people remote. In your day-to-day activities, I'm assuming that since you're head of sales that you get engaged with all of the big opportunities that come to Microsoft. And you're in there leading the charge to get them to make a decision for the services. What are the areas that you're seeing among those larger customers that they're really excited about? Is it the low-code stuff, is that very exciting to them? Or are they still wrapping their arms around that? Vahe: No, no. I would say that the notion of, let's say, application modernization, which doesn't mean I do the same thing I was doing before in the cloud. Really thinking about, what do I want to fix? And how much I can include some perspective about what could happen in some, let's say options or scenario? That capability that Power Apps has been giving them. And now we see that the corporations who are the most successful are the one who are almost creating a center of excellence within their own organization, that let's say help the IT to monitor someone, in fact the usage rate. But also to amplify the user experience and to spread it across the organization. And the ability to almost measure the positive impact. Vahe: The second thing I've seen is on the low-code, no-code, is the time to value. It's almost like you can almost now, and when I say “we,” it's almost we with the partners. We can almost say for this type of let's say expectation, or application, or challenge, it will take three month to be ready, not three years, two years. Or we have a heavy development environment. And so this center of excellence, let's say mindset or framework, is a very powerful one. Because it helps to almost create a concentration of hey, what are the most critical things to fix and how long it's going to take? Vahe: And people are almost, let's say very impressed, about how quickly you can have great quality because you bring both the expertise of, as I said, almost the person who is facing the challenge every single day. Being non-technical guy, we have in fact the support of IT. And I think that's the business decision makers along with the IT. I think to me, that's why we have been on this six, seven times faster than the market rate. We have huge ambition there. And be aware that we have also 20 million of users of Power Apps today that came from the city campaigns. So people are actively using it, not yet paying it. So that means that it's great, it's the future almost by, for us to go after. Because people are starting to use in fact at least the basic functions to get adjusted customers to and so on. Vahe: The second thing I would say is that people have realized how easy it is, and recognizing that Teams became a platform close to 300 million users. It started at 25 or 30 million almost pre-pandemic. And so that became, almost as you said, you are at home, or you are wherever you are and that's the interaction that you have with your customers, partners, ecosystem and employees. And so now it's a marginal component to say hey, can I have one tab that is going to do that type of task? My forecasting, my thing. So this is again the connection between what you use every single day at scale, and the marginal cost of bringing a component of Dynamics 365, a component of the application that you create quickly for Power Apps or Power Automate from the process, implementation, and automation. So I think that's what I see the two biggest part of the customer reaction, and I would say feedback for us. And encouragement to be fair, to keep going in that direction. Steve: We've got lots of examples that you guys have got out on the case studies of large companies that have really got in head first. And just thousands of apps in the organization solving thousands of problems. And just excellent, I mean you just have to almost grin when you look and hear about these things. But for every one of those there's still a bunch of them out there where, I don't know, IT maybe is still an obstacle. I mean IT has been, it's interesting because IT's been a friend of Microsoft for a long time because a lot of the products that they have engaged with were Microsoft products, servers, et cetera. They've had to make this transition to cloud, which was scary for them. But they ultimately did it for the most part, not all of them, did it. And now here comes low-code, no-code that's got to scare the bejesus out of a lot of IT folks. And how are you at that company size? Because frankly, we struggle with the same thing in the mid-market. How, at that big company size, do you deal with that occasional obstinance from it? Vahe: Yeah, it's a great point. You're right. I think Microsoft in general, I don't want to generalize, but in general have been for the last four years, very, very close to the IT decision makers. And rightfully so, because there were so many and still so many things to achieve in partnership with the IT and CIO environment. At the same time, when it comes to business applications or business process, I would say that you need to find the balance between the business decision makers, who are the ultimate decision makers when it comes to what is going to affect their business, or the way they work from a Salesforce perspective, or the way the marketing leaders wants to automate some of the processes that they believe is important. Vahe: And so that we probably are in a unique business case at Microsoft, where you have to talk to both. And the learning is that in the very beginning where you were only talking to IT, for example in the low-code, no-code, you could have signed a deal with IT, but then you know almost had to start to sell it again internally. Because you had to knock to all the doors of the business decision makers to say, Hey, do you know that you have this thing in your corporation, and anyway this is the thing that you can do, do you mind starting over there? Vahe: And so that was basically almost a waste of cycle. And so we said we have to do these two things together. We need to be able to articulate what is the value of low-code, no-code, maybe in FSI, financial service, or manufacturing, or in retail. And of course there's a strong common denominator. But there are some specifics that may resonate more for some industries more than others, and therefore the decision makers. And we have seen that when we do these things well together in parallel, when you sign the contract, or the deal, or the agreement, the time to move to usage or the business case implementation is much faster. Basically you bring more value both to IT and the business, and for Microsoft. And so I think that's the piece where I think it evolved on low-code, no-code, from being afraid in the beginning or skeptical, to a place where they are increasingly embracing this center of excellence environment. Where they own it as [inaudible 00:38:55]. It is connected to the business decision makers, therefore it brings value. Vahe: And so IT brings value to the business decisions or the business unit and the line of business. And then what was missing so far was, how can we give them the monitoring environment, almost the control board to manage the budget, to manage let's say, or having warning to say, hey, business A, you know are over consuming. Should we lower the investment or should we accelerate because of what you are doing? So I think that the kind of tools that we are bringing now to the IT, so that they are absolutely part of the success of the company and they are connected to the business decision makers. I think that's the best way for us to demonstrate value and keep it completely aligned with the business directions. Steve: And the opposite would be true also if you're going in trying to sell the line of business owner without talking to IT. And you convince the, now you got to go sell IT. So it's two cycles. Vahe: Absolutely. Steve: You have to somehow get them both in the same room and do it at once. So we've got so many products coming, we've got so many products here. And if you imagine a generic customer of a large size that you're going to be going to talk to next week about all the Microsoft has to offer. What are a couple of the key products that you're going to want to make sure you land in their head, that you feel across all companies are extremely high value or differentiators? The thing you don't want to walk out of that room without mentioning? Vahe: Yeah, I would say, and somehow you touch on it Steve, earlier on. As part of the transition that we are driving, one of the thing is also to simplify. To simplify the portfolio, to simplify the go-to market, to simplify the strategy. We discussed the hub and spoke, let's say strategy. And so I would say at the very beginning, what we said is that instead of saying, hey, there's a proliferation of products. And every year we add more and more and more. And at some point you confuse your own sellers, you confuse the customer, you confuse the product, it's super tough to digest everything, and even understanding what's the hierarchy across all these things? Steve: For licensing Vahe: And licensing on top all this complexity, right? I mean we have gone through it, and it's still not perfect. But at the same time I think what we said is that there are the categories, or the line of business, that we want to go in. We want to have a fair shot to take a leadership position in the next let's say years. And what it takes to get to that point, from an innovation perspective, from a go-to market perspective, from a part program perspective, from a sales and seller investment capacity perspective. And so on. And so I would say that's more the starting point Steve, where we say we define five categories, a fine line of business, where we believe we have a shot to become a leader. And these categories we need to be able to be clear on where the value that we bring. Vahe: For example, if you take the customer experience, let's say OLAP, which is more the connected sales and marketing, if I may summarize at the high level. It's going to be all the conversation about the collaborative apps, the customer experience transformation. You have already Teams for the vast batch of you, hey that's what you want to achieve. The Dynamic 65 sales is going to give you that capability, or the LinkedIn Sales Navigator on top of it is going to give you that type of insight. You know are not touching about AI, you think about almost sales automation, Salesforce automation. Let's show you how the AI infused capability within Dynamics 365 sales and marketing, give you that asset absolutely naturally integrated on your team's environment. Vahe: And same thing on Viva Sales, the sales productivity, we can measure it the way you want, and you're on control of that. And by the way, if it works on the environment that you are working, could be Microsoft, could not be as we discussed, that's more the conversation that we want to have. And of course on the back end you are going to have Dynamics 365 sales, and marketing, and Viva sales, most of the time for that line of business. If you think about let's say low-code no-code, I would say you will have probably three type of conversations. You know will have a conversation about hey, you're a large enterprise, multi-deals coverage. And basically the benefit of having an enterprise wide, let's say engagement, what does it mean? What's the framework for you to make the most of it? And how we commit with our partners to deliver you the value. Vahe: And so you can commit on five years maybe with Microsoft and how much value we can bring already to you. Or it's purely an application modernization. You move to a hyper-scale environment, but you have all these old fashioned applications. So basically, you are a platform that is modern but all your application are still old fashioned. How low-code, no-code is going to help you to accelerate that transition. And let's start with one company, one app. Pick one and let's do it right, and then replicate from there. And then potentially, in fact, the last one which I think is going to be the biggest one potentially, is the business process automation. Think about the forecasting process. I have to say that when I was running my business in Western Europe, we have been doing this traditional forecasting process, which in every company when we talk with business leaders or CFOs, that's the same thing. You ask the forecast at the lowest level of the organization, then the manager of that organization, do a judgment. That judgment moves to the next level of management. The management do another judgment. Vahe: So all the way up to the top level, who does a judgment anyway on top of it. Or they find, depending on who is doing the forecast, almost let's say a coefficient of let's say correction based on who is doing the forecast. When you start to do that thing into AI and you say what, we know the behavior of people [inaudible 00:45:26] potentially, you come after 18 months or one year to a trend of forecast that is so close to in fact what you were getting before. That you say how many hours, thousands and thousands of hours of productivity saving I'm going to have just because of this AI forecasting capability? That's the kind of example of it, for say an application for low-code, no-code, that is just checking in fact the behavior or the intelligence so far to help you to drive your business. Vahe: And so we have been running that internally as well and it's quite impressive. And so that's the kind of conversation that you want to have both with the IT, but you see this perfect example of hey, having that conversation with the CFO, or the sales leader, is a great one. Because it's a marginal cost again, to what you are using already. And the same thing happened on finance, and supply chain, and service when it comes to, all right so where you, what are you using? Are you still on-prem? The vast majority of ERP, the vast majority of contact center and call center are still on-prem. So you can think about hey, what does it take to move to a cloud and more agile environment? What are the best that you want to do? Which is the strategic partner or vendor, who are going to take this? Because you're not going to change this environment every two years. It's a 5 year, 10 year bets, right? Steve: The marriage. Vahe: It's a marriage. Yeah, absolutely. So I mean does it help Steve? Steve: Yeah. And I think interesting, one of the things I think about AI in forecasting, is it doesn't have any personal bias. And obviously in larger companies I'm sure there's a lot of checking and cross checking. In the middle market it's a bunch of optimistic sales people coming up with optimistic projections that have no basis in history or anything else that's going on, of what's going on. And I've been in meetings where we've been displaying some AI facts, or figures, or forecasts, or projections. And listen to senior people just adamantly disagree. That number is absolutely not correct. And I've had them tell me I've been doing this for 30 years, I know, I know. And then here comes next month and guess what was right? The AI model was right and the guy who's been doing it for 30 years is making up some excuses. Steve: So I think that the world right now is fraught with bad projections on everything. Cost projections, sales projections, there's too much personal bias involved in the process of creating those things. And as leadership of a company, you're relying on these things. They're going to drive you right over a cliff potentially, if you're not careful, if you don't have good information, if you can't get the bias out of it. And I think that's one of the big things that AI brings that I've found resonates with leadership sometimes, is kind of remove all the bias. I mean it's just removing all the bias. You don't want to hear smoke, you know want to hear reality so you can act accordingly. You're surrounded by a bunch of people who want to make you feel good, but AI doesn't care how you feel. It's going to tell you the truth, doesn't care if you get mad. Vahe: Steve also, it's interesting because sometime, you point to this that sometime when you are too early on the innovation, some people might be again scared or skeptical as we said. But I remember we were looking at let's say some numbers when it comes to, are we operating consistency, for example, in the world? Or there are some that say practices that are bringing more growth or more relevant than other places. And so, one thing was interesting was in the services line of business or category, you think of case management. And it's one of the opportunities. And you might say well case management is not super innovative. Well, it's something that is quite well known. But case management was one of the fastest growth in majors. And that was because it was responding to the fact that vast majority of the case management processes are still on-prem today. Vahe: And the one we're moving to the cloud, especially in public sector, to make sure that the queuing system is working, you have a full up, let's say email to tell you and tracing where you are on the request that you put in place. All these things we believe is generic everywhere, but it's not, it's by far not. And across mid-market, and large corporation, and private sector, and public sector. So it's not always innovation that drives in fact the next generation of work. It's also in fact the basics that are not fulfilled today and that create a bad customer experience. And that's interesting, in a way, to keep very humble about let's say what we still have on our plate. Steve: I can remember not that long ago, when you talk about customer service, the goal of many companies was to provide as bad as service as possible so they didn't have to do it. I mean it was a cost center for them. They hadn't come to the realization yet, this is decades, but hadn't come to realization yet that customer service is what drives future revenue. They just looked at as a cost center and figured the worst it is, the less people will use it and it'll cost us less, so that mindset has changed. You talk about fears that people have of technology. And so a lot of this is people self preservation fears. They see something coming, we saw it even in the partner channel, uh-oh here comes low-code, no-code, customers are going to be doing all the work themselves, they're not going to need us partners anymore. And it's like this first reaction that people have about anything new, is how's that going to affect me? And generally they're going to assume negatively. Steve: Our business is busier than we've ever been as a result of low-code. So it's actually been the opposite. But partners, and just like people, you know need to be prepared to pivot into that wind. If you're just going to stand there with your arms crossed and not move, yeah low-code's going to hurt you. You know need to lean into that. And the same thing with individuals that are looking at new technology. It's coming and you can either stand there with your arms crossed and let it knock you down, which is a foregone conclusion. Or you can bend with it. And to be honest, the younger folks are more flexible than us older folks. So they're not having any trouble with this technology at all. We recently signed a new customer, it's all young people and man they just get it. I mean there's no explaining anything. They understand every single thing you're talking about, why and what. And I mean they're born with a cell phone in their hand. None of this is foreign, but we still got to get rid of all of us old guys. Vahe: I agree, I agree. And time flies. And it's almost like, often, let's say, you need read to embrace that. Always a zero regret strategy in this type of, let's say, evolving environment. Anything that you postpone, to some degree, is almost let say a loss. And that has been proven in the technology run. And when I look at, we always have to be humble. It's a highly competitive market, and people are smart, and that's great. Cause as we discussed, it's all good for the customer. But I think that when I look back to the commitment of the company, the investment that we put in place last year with the support of Satya, Amy Hood, [inaudible 00:53:27]. With more than 1000 sellers injected in the marketplace, we keep going on the investment on the local no-code, even more so to drive the acceleration of the growth in addition to the Dynamic 365. Vahe: When I look at every category that we are in now, and I think it's a good confidence level that we on the path here. That first of all, we are between two times and three times the growth of the market for each of these category, that's a good indication. And I think that also raise the confidence level of the product sellers at Microsoft. To bring these different components together and add more value to the customer. So look, it's a journey Steve, and it's quite exciting to be on this. And people like yourself because we have been there also for a long time, and you know what it takes to transition. And you never fail, you learn always. And everything that you learn and that works, it's almost to think how we can scale and bring that to the mass as quick as we can so that people can benefit from it. Steve: Well success breeds success. And you know guys have got it going right now. I've taken up enough of your time. Anything that you want to get out there that I didn't ask or we didn't talk about? Vahe: No, I think, Steve, you did a good overview of let's say where we are, how we think. Again, I think that the simplification, the portfolio, the much more focused approach, the category, and more consistent execution on the go-to market is really the next level for us. And the hub and spoke strategy across all these categories gives much more room to increase the business opportunity for us and the partners. Steve: Yep, I think so, I think so. All right, listen, it was great talking to you, I'm glad you made the time. And I definitely hope to able to talk to you again in the future, get something new to talk about. Any time you want to reach out, and jump on, and talk about some stuff, let me know. We're happy to get you on. Vahe: We are all, let's say reading all these, let's say headlines on the recession. In a few months from now, between now and then of calendar year, we're to see a bit more clarity on how the planning is happening for the mid-market, large corporation, how the public sector is evolving in this dimension. And also, we'll have a few, let's say product launched that we talked about, Viva Sales, any learning from that, let's say maybe the first two, three months, would be interesting to see how people react. And maybe that could be a great opportunity for us to chat. Also what's going on the [inaudible 00:56:17] Steve: Yeah, yeah. Vahe: Plenty of things to talk, I guess. Steve: Sounds good. All right, well hey, thanks again for your time. Vahe: Thank you. Take care Steve, have a great day.

I had the pleasure of having a chat with a Power Platform industry leader, Jukka Niiranen. Listen or Watch below. Enjoy!

For as long as I have been in this business, about 25 years now, costs for clients have always been a wild card. As a Partner, you have an obligation to be straightforward about the potential costs to meet a client's requirements, but that carries significant risks, so not all partners are entirely "straightforward". Let's talk about the risks for both sides. Thunderdome It is far more common for a customer to have done their research on the platforms before contacting a Partner today. They have done the trials, fiddled here and there, and come to a conclusion on their own about the platform they intend to go forward with. The days of identifying a potential customer who has a business need, reaching out, and "selling" them on the platform you support have mostly passed. The platform decision has been made before you are even aware of them. As partners, we have to hope Microsoft wins the epic battle first, so we have a chance to do battle with our peers for the ensuing work. The Appetite At this point in my career, I have undoubtedly been on thousands of initial client calls. While I can say there are unique aspects, the similarities dominate the scale. The fundamentals of business in a capitalist world are pretty consistent. Even our Free RapidStart CRM app covers the basic "fundamentals" of business. What does vary is the client's appetite to invest the time and money to climb the ladder of sophisticated solutions to these fundamentals. The Brief Not all client projects have a Brief or Requirements Document. Generally, I prefer when they do not. Don't get me wrong, I love to have a nice list of the issues they hope to solve, but too often, they also dictate the technologies they want to use to solve those issues. This is my turf. You did a trail and read some blog posts; you know nothing. A client who is not open to me determining the best technology for each issue is a client another partner can have. That project is destined to fail. The Budget The easiest way to elicit a lie from a client is to ask them what their budget is. They will either say they have not determined one yet, which is often true or give you a substantially lower number than allocated. Either way, it has no relation to the actual cost; how could it? But it does have a relation to their perceived value of solving the challenges. This is often way off as their viewport tends to narrow. Optimizing their sales processes to reduce sales headcount is calculated as the net salary savings compared to the cost. But what about the increased sales that will also result from this optimization? The Number There is always a dance when it comes to the number. Clients would naturally like to know before they embark on this path what the ultimate cost would be. The fact is that partners have no idea. Even "educated guesses" have proven to be miles off. The only consistent thing is that whatever number is given will always prove too low. Unless the client insists on a guaranteed fixed cost, then not only will the number given be much higher than the actual ultimate cost, but the client has also set up a tug-o-war over the scope and that number for the duration of the project. That project is also destined to fail. You Can't Get There From Here As you can see, the client's hope of eliminating their cost risk is not possible. They can't even minimize the risk. It's amazing any of them move forward at all. But they still have that damn business problem to solve. So, they pick a partner and take a leap of faith with no real idea what the path they have set out on will ultimately cost. This works out well about the same number of times as it doesn't. The Project The client has paid some money, and a project is underway. All smiles at this point. Everybody on the team has turned into a smiling bobblehead... in agreement on everything. This won't last. Soon, there will be an issue. A realization will be made by one side or the other. The client may realize that a requirement was missed, or the partner may realize that a current requirement will take much more effort than anticipated. Smiles will fade, and heads will stop bobbling. No one is right, and no one is wrong; it just is what it is, a "predicament". In almost every case, this predicament will be resolved by more funds from the client. Throughout this project, there will be many more "predicaments', and all will be solved the same way. It is entirely possible that the total cost of the solution will exceed the value of the problem. It is unpredictable. Cost Predictability The thing clients want more than anything is clarity and visibility. A lifting of the fog over the future. If they could "clearly" see, maybe they would not proceed, thus removing a potentially failed project from the ledger. If they could "clearly" see, they could proceed with a much higher comfort and confidence level. This was the over-arching impetus for our developing of "The Works". Our new all-inclusive "Services-as-a-Subscription" model. It's new, new to the industry, new to customers, and new to us. It's not perfect yet, and I've written about that as we continue to evolve it. But compared to the status-quo, it has the potential to change everything.    

Back in May, I wrote a post describing a completely new Services model we call "The Works from Forceworks". It is a Services-as-a-Subscription model that is unique in the industry. I also promised to follow up with our learnings from this new model, so today I will do just that. The Works First, I'll remind you of what the offer is. Thanks to advances in low-code/no-code for Dynamics 365 and the Power Platform we decided it was finally time to launch a completely new services model. An all-inclusive, unlimited service that included not just support, but also deployments and customizations, along with several other things. You can see what we included here. Based on our analysis of recent customer history, "The Works" will cover 100% of the requirements for about 90% of the customers. How's it Going? Customers are eating it up. Almost all of our existing customers have converted. I am thinking we may have left some money on the table. But now is not the time to maximize the revenue, rather now is the time to flesh this out. We wanted this to be as "turn-key" as possible starting with getting a quote that can be done right on the website. This meant "standardizing" the pricing. Today there is a Fixed Base cost, plus an additional fixed cost for certain combinations, like Dynamics for Marketing for example, and then a Per User cost. Part of the thinking was that the number of users would be a good measure of the work our team would need to perform. But in reality, while a good general rule, there are exceptions. For example, a simple deployment with basic needs, but a large number of users, versus a highly complex deployment with only a handful of users. For the former, the price is too high and for the latter, the price is too low. We are still thinking about the best solution to this. Pro-Active Almost all services offered by Partners to Customers are "reactive", responding to customer requests. This makes sense in an hourly model as it is not the Partner's job to decide how to spend the customer's money. But in an unlimited subscription model, we are able to be "pro-active" since it does not affect the customers' cost. A simple example may be once a week checking to see if all Flows are running properly or checking capacity. One of the primary differences in a Subscription model is that it is very important that the customer renews at the end of the term. Customers will scrutinize that monthly charge and compare the value they received each month. If at renewal time, they didn't see the value, they will not renew. Over a twelve-month term there will be months that are more active than others. But you cannot allow a month to go by with no activity, and this is where pro-active services fill the gaps. We are continuing to add to the list of things that we can do pro-actively to bring value and building tools to try and automate that as much as possible. User Support We were initially thinking this might be a big item, and for some it is. We had this idea that all users would be added to a Team or Distribution List that our team were also members of to communicate and resolve issues. Some customers loved the idea and added all users. Others preferred to keep that group small. We built a solution that we install on each customer environment that adds a life ring icon in the top navigation. This opens a form modal where a user can report an error, ask a question or suggest an improvement which via Flow is added to the Team or Distribution list. I am pretty happy with the result having seen many improvement ideas coming directly from the trenches. Deployments The service includes unlimited deployments. This was a dicey one, but I insisted that we include it. The easiest thing to do is to specifically exclude things from an unlimited service to reduce your risk. But you would quickly get to a point were "Unlimited" did not mean anything. This is also a key point at which an unlimited service makes extra sense. For a deployment month, you know your needs will be higher than usual. When comparing to hours you could easily spend as much in a deployment month than the entire annual subscription cost. We have not been doing this that long, but I can already see that we will go underwater during deployment months for a customer. Fortunately, deployments do not happen very often. Customizations This service also includes unlimited customizations, and by extension, to do those properly, unlimited Solution Architecting. If low-code/no-code were not where it is today, this would not be feasible. Where deployments are typically a one-time big bang, customizations are continuous. Although the amount varies from month to month. So far this is averaging out okay. Exclusions We tried really hard to include as much as possible on an unlimited basis, but developers are expensive, and development can often take a lot of time. So "development" is excluded and offered on our traditional hours model. This is the one area that some customers get suspicious about. Looking for the "gotcha" they expect that every time they ask for anything we will cry "development". But again, tracking with our earlier research, many customers never hear the word "development". It does seem that the more sophisticated the customer the more they look for sophisticated solutions which can often require some development. There is some grey area here and we are likely to do something one-off that might meet the technical definition of development within the service rather than bring up the need for development hours, because again the goal is renewal. Are We Making Money Yet? It is still too early to tell, but probably not. However, this is not unusual for a new subscription service as it builds scale. We are also still building the tooling to make this more efficient. As of now, we do have one customer that I can see we will consistently lose money on every month. This is the reason I added the right for us to terminate for any reason in our Terms and Conditions. We still need to figure out the best way to handle that. Summary Was this a good idea? I was not sure when we launched this, but now I can see it was indeed a good idea. There is a tipping point of profitability based on the number of subscribers that we have not reached yet, but I am confident that we will. My next update will be when we reach that tipping point, hopefully in the not too distant future.

In my recent conversations with Charles Lamanna here and Jason Gumpert here, we discussed the explosive growth of the Power Platform. Then while listening to Jukka Niiranen on yet another podcast here, I was reminded that we are all inside the Power Platform bubble. From the outside, however, this bubble is tiny. Expanding Bubble There is no denying that the Power Platform's growth is impressive, but who is growing it? Microsoft has a fist-full of enterprise-sized customers who went all-in and sang the praises. But of all the enterprise-sized customers worldwide, I doubt this has touched even 1%. Sure, we have a ton of new "citizens" making things, but a "ton" does not even register on the scale. In an imaginary global IT heatmap, the Power Platform is still invisible. Popping the Bubble The Microsoft bubble is our constraint. Microsoft people are talking to Microsoft Customers and Microsoft Partners about Microsoft stuff. Obviously, "Microsoft" is quite visible in that imaginary heatmap, but the Power Platform is still largely unknown. While organizations may be starting to hear about components, like Power Automate, for example, too many are oblivious to the other components that make up the Power Platform whole. Many think the ability to create a reminder Flow in Power Automate is the limit. Mistakes Were Made I spend much of my time with customers today trying to work around go-to-market mistakes Microsoft made and continues to make. Seeded Power Apps is one. This should have been called Power Apps Lite or Basic, so people would be aware that there is something more, like Power Apps Pro. This alone would not have solved the invisibility issue, but it could be a start. I think too many feel that the seeded capabilities are the extent of it. There are undoubtedly many widget-type apps that have been built with these seeded toys, but if a customer were to inquire about more, they would reach another GTM mistake. If they want more than a simple Laptop Checkout app, the next logical step must be "Dynamics 365". I recall clearly jumping straight into a Jet cockpit after mastering my tricycle at three years old. But that was me. Too Small Those who somehow accidently discovered that there is more available than just the seeded capabilities realize quickly that Microsoft just gave them a toy to play with. Looking back over their shoulder, they see mostly broken toys now. Many wondering why Microsoft let them waste so much time and energy before they tripped through the curtain of awareness. Too Big I am not knocking Dynamics 365; Microsoft has built a colossal Power App aimed squarely at enterprise organizations. It is indeed a "step up" from the seeded toy builder. But, among the zillion features coming soon to add to the existing gabillion features are the abilities to "Create sequences with looping of repeated steps" or "Assignment by segment priority" WTF is that? I just want to sell my stuff! You will need a team of internal and external resources just to sift through the capabilities and understand what they are and whether they can do anything for you. Just Right? There is a space between the seeded toys and Dynamics 365, which is actually the biggest hidden space. Obviously, Microsoft would prefer that you drop half of your annual revenue subscribing to their big solutions; it is not "bad"; it is their business, no different from any other enterprise software company. In my recent chat with Charles, he said, "we have some great data about every user who adopts Power Platform is significantly more likely to adopt Dynamics within the next year or two." Maybe these users were unaware of what the Power Platform could actually do? Low-Code/No-Code "LCNC" This "is" the movement of this decade. The movement of the last decade was getting all but the genuinely paranoid to the cloud. But once there, many realized it wasn't cheaper; it was quite a bit more expensive, and subscriptions are like waves in the ocean; they never stop. Where can you save? Development expenses. Chipping away at that 5, 6, or 7-figure albatross. This is what LCNC is about. It may be subscription protection at the developers' expense, but it is still a big win for customers. From Win to Win-Win LCNC will save customers a lot of money on their Dynamics 365 deployments. Some development may still be required for some things, but not nearly as much as in the last decade. And we are only in 2022! That is indeed a massive Win for customers. But a Win-Win is achievable for those who take the time to understand the Power Platform, the same thing that Dynamics 365 runs on, and what they can build with LCNC directly on there. Not only will they save massive development costs, even if they still engage an LCNC partner, but they could also save +/- 90% on Microsoft Licensing costs. This is not highly promoted for apparent reasons, but we are helping customers build sophisticated business applications with advanced logic and automation, solving complex business problems on $5 Microsoft licenses daily! Summary LCNC, while still in its infancy, is already very powerful and growing more so every month. To see an example of what I am talking about, you can check out our Free RapidStart CRM app and our addons. All of which were built using LCNC on the Power Platform. Microsoft tells a "No Cliffs" story, meaning that you can start with the seeded capabilities, and once you hit a limit, you can advance to the Platform Platform, and once you hit a limit there, you can advance to Dynamics 365. What they don't emphasize is that the Power Platform doesn't have any limits you will hit. Many, starting with RapidStart CRM as a head start, used LCNC to build massively complex mission-critical solutions, with and without our help. LCNC and the Power Platform is a movement you cannot afford not to explore!

I have had my head down working on some big things since RapidStart CRM growth exploded, and it has been a while since you heard from me. Well, I'm getting back to it with a follow-up chat with Charles Lamanna who recently took over for James Phillips as head of Business Applications for Microsoft. This was my fourth chat with Charles, and it was interesting to back listen to them in order. It really gives you a sense of where Microsoft has come. I managed to catch him in his office having just wrapped up their year-end. Enjoy! If you want to listen to my chats with Charles in order, The first one was October of 2018, the second one was September of 2019, the third one was March of 2020. Transcript Below: Steve: Welcome to the Steve Has a Chat Podcast. Where I call someone out of the blue with a record button on, and hope to have an unscripted conversation about Microsoft business applications. Let's see how it goes. Enjoy. Charles: Hey, this is Charles Lamanna. Steve: Charles. Steve Mordue. How are you doing? Charles: Good. Great to hear from you, Steve. It's been a long time. Steve: It has been a while. Have you got some time for a chat? Charles: For you, anytime. Steve: I appreciate it. Well, I guess the big news for you obviously is putting on the big boy hat, huh? Charles: Yes. I moved up an extra floor in the Advanta building in the Microsoft Campus. Steve: Oh did you? Charles: No, I'm just kidding. But metaphorically speaking at least. Because for folks that don't know, James Phillips leaving in March of this year, I kinda stepped in across all aspects of business applications of Microsoft. And, over the last four years, I've gotten to know the place, know the people, know the business and I'm super excited about the opportunity. And I think the future has never been brighter for business at Microsoft. Steve: Well, I never got the feeling that James held you back, or any of the folks on your team back, but he certainly, we have to give him a lot of credit for really taking this thing to a whole nother level. You weren't here before, I don't think, at least with the business apps, but it was really run by morons before he took over. And he completely turned that thing around and turned it in a whole nother business. And now with you taking over, I'm expecting that to continue. I don't know if there's been some things that have been in your bag that you've wanted to do that James was keeping you from, that you're going to pull out, or if you're just going to continue the path, or what's your thinking now that you've got that gavel? Charles: So definitely not held back. I would say I was super fortunate I worked for James for, I think seven, eight years in total. So I was able to learn a bunch and he was without a doubt, the most supportive manager I've ever had in my career, in terms of both enabling and clearing paths for what we wanted to do from a vision and dreaming perspective. And if it weren't for his support, things like Power Apps would have never gotten off the ground. So, definitely. And I think as we go to the future, we have this amazing foundation. I mean, BizApps is a major and key component and pillar of the Microsoft Cloud. Charles: 10 years ago, you probably would've thought that impossible. Right. To have Dynamics and Power Platform alongside Azure and Office. Now that we're here, let's go take it to the next level. And that's the push, and it's continuing a lot of the great innovation we've already done from a data-first, AI-first approach. Kind of sprinkling in some more collaboration with teams, and really revisiting the end-user experience, the platform, to go increasingly modernize and scale it and make sure that all our components from CRM, to ERP, to Power Platform work great together. Steve: I don't think it could have achieved that status with Dynamics 365 alone. It really took the Power Platform coming into being, I think, to give it the breadth that it needed to be able to get there. With Dynamics 365, we didn't have apps for users to do small things, there was no way it was going to permeate an organization the way the Power Apps do. Charles: Yeah. Yeah, that's right. I say two things are interesting. The first is, Power Platform has allowed us to help more users and more customers with business process transformation, which is what BizApps are all about. Right? Steve: Yeah. Charles: How do you make your sales processes better, your financial processes better, and Power Platform really turbocharged that. And that earned us credibility in a lot of those departments and with a lot of those users, and we have some great data about every user who adopts Power Platform is significantly more likely to adopt Dynamics within the next year or two. So we see that symbiosis working in a way which is incredibly customer-friendly, and it helps our business. Second thing is Power Platform has even helped us reimagine parts of the Dynamics apps themselves. And I think probably two of the best examples are the connectors, which are key to the Power Platform. Charles: You see the connectors starting to show up inside all these Dynamics apps, like Customer Insights uses Power Query for data ingestion, or Viva Sales even connects to Salesforce. So there's this amazing interoperability that we have, and also enabling the end-user. Our team built Viva Sales, even though it's not in the Dynamics or Power Platform brand. But it's this idea of having an integrated experience in Office for sellers, built on connectors and built on the Office integration. So it's changed the way you think about some products, and it's also helped us go expand our user base. Steve: Yeah. I saw I was on a PGI call with that yesterday. Very, very cool stuff. At the last PAC meeting, I was supposed to be on the Viva Sales round table, but I'm like, "Yeah, that sounds boring. I think I'm going to go to this one." And I really, I went to the wrong one, I missed a good one. But you know where I am, right? I'm on the platform. Charles: Yep. Steve: And we're exploding. Our app is continuing to grow on the platform as a low-cost simpler alternative to Dynamics 365 for companies that aren't ready for that. And I'm always bugging you about, "Hey, that cool new feature you guys got in the first-party. When are we going to get that at the platform level? So ISVs, and people that are just building their own stuff from scratch, could take advantage of some of the syncs." We got the Outlook app a while ago, we've been getting some things. And when I saw Viva Sales, that was probably my only disappointment was that, at least as I understand it, it's hardwired to Dynamics or hardwired to Salesforce. And I get that trying to play those two against each other, but it's leaving guys like me out in the cold. Charles: Well, I'd say for Viva Sales, the intent is to support any CRM, and I really do mean that generally. And even customers, because there are customers out there that we talked to today who have homegrown CRMs, they coded 15 years ago. They have a whole dev team still working on it. The idea is to support interoperability with your account records, your lead records, your opportunity records, standard pipeline data. And to do that in a way which works through the connector. So today it'll earn V1, it'll only be Dynamics in Salesforce, but the intent is to make that be a general purpose adapter. And you could have a RapidStart CRM connector, which shows up and supports the contacts the way we want, and it would be connectable. That's not going to happen in the next three months, but that's the ambition. Steve: I can call you in four. Charles: I go down and said... What was that, in four Months? Steve: I can call you in four months. Charles: Yeah. Yes. Yeah. I might not pick up the phone then in four months, no I'm just kidding. Because even talking about, if people are even on Seibal. We should be able to support them with their sales. Because the idea is, you shouldn't have to transform the seller experience at the same pace that you transform your core CRM, your core system of record, and that's just the way the world's moving. Steve: Well, I love the idea that one of the challenges that CRM has always had, of course, is user adoption. It's one more place they need to go to do something. Outlook app helped with that, getting data into CRM without them having to actually go to it. It seems like yet another way for people to engage with their CRM without actually realizing they're engaging with their CRM. Charles: Exactly. Yeah. It's almost like ambient... Yeah for sure. Sorry. Yeah. I say it's almost like ambient CRM basically. How do you make it so that, instead of the user goes to your CRM, the CRM goes to the user where they are. And the outlook app was the beginnings of that. Some of the Team's integrations we've done are the beginnings of that. And that Viva Sales and that whole Viva idea is how do you elevate it? So anywhere you go, your CRM data is accessible without you having to go to a different user interface. Steve: Very cool. Very cool. So I ask you every time we get on a call about exciting features that are coming up. And in particular, maybe even some features that have launched, that didn't take off the way you thought they would and people are just missing something. We have this problem with our app sometimes, people don't understand and so they don't move forward, and it would be perfect for them. And I'm sure there's lots of features and capabilities that you guys broke a sweat building, and know in your heart, this would be awesome, but people don't seem to be getting that. What's a good example of one of those? Charles: I'd say a product which we've had a capability, where we've had a lot of customer usage from a small number of customers, but very deeply and with huge impact, and we wish were with more customers, is probably Conversation Intelligence. I'm not sure if you've seen that around the Sales app, and where that actually will sit in inside of say a phone call or a meeting and help you generate action items, and summaries, and coaching, and help you understand sentiment, and listening and talk ratio. We've used that internally at Microsoft with great success. So our digital sales reps and the folks who work our phones, they are diehard fans. We have this amazing video we released a couple months ago where we actually went out and interviewed these digital sales reps and their managers, and they just were going on and on about how great it is. Charles: And that's rare where you hear that about a piece of technology for a seller. And we have a few other external customers that have gone through that same journey, where they have a thousand digital reps, 2000 digital reps using this and just in love with it. But it's not as pervasive as we thought it would be at this point. And it's one of those things where, it's a product discovery, and easing people into the capability, because then you got to go out of your way to enable it and configure it. So we're doing work now to simplify it, and make it more accessible to more users. And we're doing that partly through Viva Sales, like conversation intelligence, the major capability of Viva Sales. Charles: And the second thing is also, there's even some culture aspects to it. Because if you use it, it's generating transcripts and recordings of a call, and not everyone's necessarily super comfortable with that. So we're even working about how do you enable more features without having to record the call, and how do you enable capabilities without having to get a transcript? Or how do you make it more natural to say, "Hey, I have a sales co-pilot thing. Are you okay if I enable it?" So there's a lot of interesting things, it's never just a technology problem. It's also a discovery and a, I'd say, change culture management problem. Steve: Yeah. I think that's been the challenge with anything AI really. A lot of people, it seem to think it might be a little too futuristic. They look at the benefit and think that's really cool, but they have no idea how to get it. And AI just in general, doesn't feel that approachable to people, even though in certain cases, it's extremely approachable. You don't have to do anything, it's approaching you. So it's a learning curve, you got to wait until my generation dies off and then you guys will see. Charles: I don't have as myopic of you, as you Steve. But I would say that, the big thing that we have to do is, there's been this evolution of AI where the AI is going to be something that automates away what humans do. And what we've realized is, AI is not even remotely close to being able to do that. But what AI can do, is it can turbocharge the people that use it. And so what we're trying to do is, how do we go expose these AI capabilities in a way where you or anyone else who uses them feels so much more productive. And just like when you first got the ability to use PC or a spreadsheet, you're like, "How did I exist before?" We're hoping we'll get to the point where, once you start using some of these AI assistive capabilities, like we've done in Conversation Intelligence, you'll be like, "How did I ever do a customer call before? And I had to take notes on paper while listening as opposed to having the AI take notes for me?" Yeah, exactly. Steve: I'm terrible about that. I'll be chicken scratching over here while I'm talking to people, and then we get off the phone I look at and I can't understand a word I wrote. Charles: Yeah. I like post-it notes next to my desk where I'm always writing stuff down. Steve: Yeah. So what else cool's coming on the horizon that we should be... That sounds like the Conversational Intelligence has been around. Sounds like Viva Sales is going to really bring that to the masses, so that one's on a path. What are some other new things that we should pay attention to that you're able to talk about? Charles: Yeah. Another one of my favorite things, which we've started to reveal some capabilities going back to last Ignite, so November of 2021. And we have some big announcements planned for the second half of 2022, is the new Contact Center related capabilities inside of Dynamics Customer Service. We have Omnichannel, we announced integrated voice, the Nuance acquisition closed, and the Nuance contact center AI team joined my group to align with customer service and contact center. So there's a lot of really exciting innovation happening there. And I'm really excited about the potential to make it super easy to get a comprehensive customer engagement story, without having to wire up eight different pieces of technology and do a ton of different complex integrations. So that's a place where there's a lot of innovation, there's new capabilities, Omnichannel, Power Virtual Agent, even the same type of conversation intelligence applied to support cases, Nuance for their Gatekeeper, which is identity and authentication verification based on voice and biometrics. Charles: There's a lot of cool stuff in that space. And that's one of the places where so many of the customers we work with are trying to improve the customer experience, and to go reduce costs. So I say that's a place where we've had a lot of exciting announcements over the last six to nine months, and we have a whole bunch more planned for the next six to nine months. So I say, stay tuned. And I won't say more than that to avoid getting in trouble by leaking information. But I just say, that's a place to really pay close attention. Steve: Who knew call centers could be cool? Charles: Yeah, exactly. Who would have thought that I'd be talking about contact centers, and how it's the next generation or next frontier of AI applications in 2022. Steve: Oh, well. Well I do have to thank you guys for the low-code advances you've continued to make in that platform. It actually allowed us to launch a, I think we're the first ones to try this, a new Service as a Subscription. Which includes awesome includes deployment, customization, training, everything except development code, which as you know today in so many of these projects, there's so little, if any of that. Charles: Yeah. Steve: Just a few years ago, if you tried to offer something like this, it really would be little more than a support agreement. But now, we're deploying, we're building, we're customizing, we're building entire things for customers all on a monthly subscription. It's an interesting concept, and hopefully I don't go broke, but... Charles: But you know what, it's fascinating. I literally was talking about this with the Power Platform team this morning. About a future where we'll have more partners who are able to sell a comprehensive service agreement, which includes the cloud hosting licenses, but also some incremental custom development and also ongoing maintenance and support. And it'll be almost this whole new industry, which will push a lot of innovation to the edges of the ecosystem, right? Steve: Yep. Charles: Not built by Microsoft, built by partners who really understand particular regions, particular industries, or particular segments. Like y'all are targeting a space where we're not trying to go take Dynamics, CRM, and go bring it down there. You can go build a world-class experience on top of our platform and provide a very much all-in-one, which exactly serves the needs of that audience and that market. And we can stay focused on building the super horizontal platform, which has great performance, great usability, incredible power, those types of things. Steve: Yeah, it sounds great. I'm glad that we had the same idea you guys did. I'll let you know, in a few months, if it was a smart one. Time will tell. Charles: Yes. Yeah. Steve: So, how are the rest of the team doing? It seems like some folks have moved around a little bit in the org, who's moved where? Charles: Yeah. So one of the big things we've been really focused on the engineering side, for the engineering organization, is bringing together strength from a product perspective that target the same type of user. And for example, we have a new customer experience platform team underneath Lori Lamkin, who leads all of our Dynamic Sales apps. So the Core Sales and Viva Sales, as well as commerce, as well as marketing, as well as customer insights. And it's very much focused on revenue generation, customer journeys, customer experiences. And what's great is by bringing those assets together, we have a great answer for B2B customers, as well as B2C. Like if you want to have self service, no touch eCommerce experience with lightweight telesales, you can do that all with those sets of applications. If you want to do a high relationship, high touch B2B sales process, you can do all of that. You're not going to use commerce, but you're probably going to use customer insights and sales, and maybe a little bit of account-based marketing. So we brought together these things, which are solving similar problems under a single leader. And that way the engineering teams can go back and forth between these different places to finish out full end-to-end customer journeys. And so that's a big area that we've spent a lot of time on, and that's a place where it's really the biggest and fastest growing category for us in the Dynamics 365 application portfolio. So that's one interesting example. Jeff Comstock, folks may know him. He's been around Dynamics 365 for a while. He continues customer service, he leads omnichannel, he's done some of this great expansion around the contact center for us. Ray Smith leads our supply chain team. So that includes things like more supply chain. Steve: So Ray moved? Charles: Yeah, yeah, yeah. He by way of acquisition to SAP then moved. He worked in Dynamic Sales for a bit, where people may have known him. And now the supply chain, and really helping us be this new data driven, AI powered, supply chain story for core supply chain execution. Then we also had some exciting announcements around process advisor and the minor acquisition to help turbocharge that. Or Georg Glantschnig who leads our finance room of the house. And basically we call the room of the house, is the collection of products which focus on serving the CFO and the finance department. And that includes the Suplari acquisition, which we had done a couple years ago, as well as the Core Dynamics, 365 finance, HR, and project operations products. Charles: So you can see how we started to build these critical paths around particular departments and particular lines of businesses with our products. And in addition to that, we also of course have Power Platform to support all of it. So it's amazing to see these things come together and converge. And we've been on this incredible run of innovation around Dynamics. I was counting it earlier this year, 29 different products in Dynamics, and really coalesced around these specific areas where we have a lot of energy, and also very well understood. I'd say synergies between the products that we have. So I'd say exciting times. Very exciting times. Steve: Customers are starting to understand it better also. Business Applications was the same thing for a long time. Then it spent the last five years reinventing itself every month, and new things exploding out of Advanta. And I think a lot of customers were having trouble just keeping up with... It's like little whackamole for them. And it takes a little time for customers to absorb what's happening, and what it's for, or what it does, and then to adopt it. And we're seeing that now. We used to have to go out and promote Power Apps to people who didn't understand what this was, or why it was. And now it's the opposite. They always come to us, looking for Power Apps, looking at those sorts of things. So that understanding seems to have finally permeated down to the customer level. But boy, it took a while. Charles: Yeah. It warms my heart. And I would say one of my favorite books is by Jim Collins, 'Good to great.' I always recommend it to folks on my team to read it. And he talks about this idea of the flywheel. It takes time to get a flywheel spinning, for the first period of time it looks like it's barely moving, but then eventually it's going super fast and it's just a blur. And you need to be consistent, and convicted, and believe in the strategy and the approach. And what's amazing about BizApps is for the last four years, we've been on the same mission, the same vision, the same ambition. And we just spend all the folks in advance at turning that flywheel, turning that flywheel. And it's started to reach that blur phase where it's spinning so fast, you can't even see it. Charles: And this, this all started years and years ago with a ton of work, but we're really at that magical moment where customers know what Power Platform is. Customers know that Microsoft gets customer experience and customer engagement. They know that Microsoft can help them optimize their supply chain. And what the good news is once that thing is going, it really builds upon itself, and I think it'll only continue that momentum further. And my favorite story is, I used to always do these executive briefings at Microsoft where we have executives come in from our customers to Redmond and we have a briefing center. It's very nice. And I would always say, let me talk about Power Apps and low-code. Charles: And everybody gives me a blank stare like, "What the heck is Power Apps? What the heck is low-code?" I go in those meetings now, and people know what Power Apps is, and they know the low-code strategy. And the only question is, "how?". Not, "should I?" Or "if?" "How do I do it with you, Microsoft?" And so different from three years ago. So anyway, so you're exactly right. A long winded answer, but I'd say it's exciting to see all of these things come together, and the benefits of just consistently repeating a message that resonates with customers. Steve: I would say at least three quarters of my customer calls today, they're bringing up right out of the gate, "We don't want any development. We want to do everything low-code, no code." So this is coming from the customer side where we used to have to explain to them what low-code, no code meant. Now they're coming demanding, "I only want low-code, no code." I think that they've come to this realization that, while low-code, no code might not be easy enough for your mom to do, it doesn't require a developer, and code does require developer. And once you've got this little blob of code in your environment, it's a black box for you. And so they don't want any of these black boxes. They want everything to be accessible. Steve: Use your knowledge to build us something complex out of low-code, but then I can still go back in there later and manipulate it, adjust it myself, or our team. So they have absolutely bought into that. And I know we originally, a lot of us partners were concerned early on that this was going to reduce the workload for partners, while our workload is more than it has ever been. Although the developers on the bench don't stay as busy as they used to. We've completely pivoted the team from developer heavy to now, we haven't even got a good title for them. A citizen developer doesn't sound right. We tell customers that, but citizen developers is what we've got so... Charles: This guy we found on the street, or gal found on the street, we just asked them to start building out. But no, it makes sense. There is almost this new role which is, it's not just pure coding expertise, it's technical development concept expertise. But even more importantly is business process and solution expertise. And that fusion of those two skill sets, that's the magic. That's what makes it special, because you understand it. Steve: Yeah. The challenge that we have with this brand new model that we just launched, because, first of all, being the first one out there is not always good because people have no idea what you're talking about. They're trying to compare it to other things. But we've got this little caveat that it's all you can eat, everything, except development code. And trying to define what that is hasn't been easy, and you get these customers coming in, "Oh, we're going to need a lot of customization. So this isn't going to work for us." And so you may need a lot of customizations, but you don't need any "development code". Charles: Yeah. Steve: And getting them to grasp that development code and customization are not synonymous, not even close. Charles: Exactly. Steve: Development code is a very small component today of customization. And once I think that they understand that, then we'll probably see more partners coming into a model like this. Because it makes a lot of sense for customers, makes a lot of sense for partners. Charles: Yeah. And if you go look at building solutions that last a decade, this is to your point, code is this little black box opaque thing, which is hard to maintain over time. If it's no code, low-code, it's easy to open it up and reconfigure as business requirements change. And it's how you build solutions that last. And I think we're getting to the phase with business software where customers are expecting to make long term technology bets. You're not going to replace your CRM every five years from now on. It's like building manufacturing plants and warehouses. These are big investments that you need to be able to amortize over a long time, to justify. And so I think to your point, no code doesn't mean no flexibility, no customization, also doesn't mean no agility. It just means you're doing it in a different way. Couldn't say it better myself. Steve: All right. Cool. Hey, listen, I'm going to let you go. I really appreciate you taking the time out of your day here when I caught you, to chat with me about this stuff, always fun talking to you Charles. I'm going to call you in four months and ask you about Viva Sales for the platform. Charles: Sounds good. Sounds good. Steve: I've got you on record there. Charles: So really appreciate you taking the time, giving me a ring, Steve. Hope you have a great rest of the summer. Steve: All right, man. Have a good one. Charles: Yep. You too.  

In my 20-plus years in this CRM business, I have seen my share of "Funnels". Lead Funnels, Sales Funnels, Delivery Funnels, every kind of business-related funnel you can think of, I have probably seen it. From what I have witnessed, most businesses have no idea how to use them effectively. So, let's talk about Funnels. The Numbers Game One of the most significant areas I see where customers are consistently missing the mark is in their Sales Funnels. While at the same time tripling their investment in Lead Funnels. The logic seems to go like this; if we currently convert 5% of our Leads into Sales, we just need 10X more Leads. As if somehow, by dramatically increasing the size of a pile of crap, the smell will improve. But, logical as their argument may be, the math does not hold up in execution. If your sales process is working as hard as possible to convert 5% of your Leads, multiplying what gets thrown into that process by ten will not result in a 10X sales increase; more likely, your conversion rate will plummet. And, by the way, multiplying your leads by ten is not cheap or easy to do either. Fixing the Right Problem Don't get me wrong; Leads are vitally important to any business. But creating a waterfall that you are only capturing a bucket from is more than a waste of money and energy; it could actually be hurting you. If 95% of your Leads are not buying, then something is broken, and shoving more people down a broken path is like shooting a bullet into the head of each of those missed opportunities because they are now dead forever. Today you seldom get a second chance. What is a Healthy Conversion Rate? That depends on many factors, varies widely by industry, and actually starts with your Lead Funnel. Wide funnels will capture a large number of non-prospects. Why do they click or call when they are not valid candidates? Who knows, boredom, bots, etc.? Either way, they are a waste of your resources. This is a common technique employed by many marketing/SEO agencies, creating a wide funnel so they can point to how many leads they generated to justify the continuation of their services. But the number is not important if you only convert a small percentage of them. There are three possible reasons that you are not converting more. Either a) your value proposition is crap, b) your leads are the wrong people, c) your sales funnel sucks, or a combination of these. Your Value Proposition Your perception of your Value Proposition is irrelevant, it is something seen through the eyes of your Prospects, and even highly qualified Prospects will each view it differently. How hard is it to sell your product or services to a qualified lead? If it is too hard, there is something wrong with your value proposition. If it is too easy... there is also something wrong with your value proposition. I am not a buyer of whatever you sell, so having the right value proposition is on you to figure out. Your Leads are the Wrong People Congratulations, if how much money you throw away was the measure... you're winning! Unfortunately, no amount of unqualified Leads will fix a Conversion problem; instead, it compounds it. This leads us to the real issue. Your Sales Funnel Sucks The good news is that you are not alone; the bad news is that you are failing to convert 95% of your leads. Effective Sales Funnels are elusive things. This is probably why so much money is shoveled into increasingly wider lead funnels in an attempt to overcome the real problem, but it just masks it at best. Too many people think that their Lead Funnel IS their Sales Funnel, which means they are missing a Funnel. In most businesses, Marketing, whose job is to create leads, and Sales, whose job is to close them, are related but completely different things. Sure, one thing "should" feed into the other, but the skill to get someone to click on a Google ad, for example, is a different skill than getting that someone to buy. But they are directly related in that the person creating the leads can make the conversion of that lead easier or harder depending on their skill. For most B2B and many B2C organizations, a seller will take over at some point, and a "Sales Funnel" will ensue even if it does not actually exist. Suppose you don't have an official Sales Funnel that has been thoughtfully developed. In that case, you actually have a unique unofficial funnel for each salesperson based on their personal knowledge, skill, and history. This is also why you see such a wide disparity of close ratios across your sales team. Building a Sales Funnel First, do you need a CRM to have a Sales Funnel? A Sales Funnel, like a Lead Funnel, will need some steps. Too many people try and skip having any steps other than "get the prospect on the phone a close them!". But the 1960s are ancient history, and selling today requires more sophistication and finesse. Just getting that prospect on the phone is no easy task now. A logical, systematic process will generate much higher success, and modern CRM solutions are purpose-built for this. If you feel like CRM solutions are too expensive or complicated, you can check out RapidStart CRM to build your Sales Funnel. It is possible to build a Sales Funnel by mirroring the steps and process of your star sellers unless all you have are mediocre sellers. Either way, a good Sales Funnel should start before the Lead Funnel ends. To be proactive, you have to know what is coming, what context they are coming in from, and what they have already been informed of before their arrival in your Sales Funnel. CRM solutions can also be utilized to build and track Lead Funnels, making this visibility much easier. Reactive Sales Funnels always have lower success. A good Sales Funnel can make both your stars and your mediocre sellers better. Automation You may have heard the terms "Sales Enablement" or "Sales Automation"; they are popping up a lot lately. A Sales Funnel is also at the center of these, and varying "Automation" is layered over the Funnel. Applying "Automation" to steps where it makes sense throughout your Sales process can accomplish many things. Among these is a consistency of process. Once you have a working Funnel that generates successful outcomes, you will want to replicate that motion consistently, and nothing is more consistent than automation. Automation is also "instant", so your process commences immediately when triggered, which is something many customers seem to like. Automation can also multiply the capacity of an existing team, meaning you may not need to hire, and you may be able to shed some dead weight. You have to be certain that your Sales Funnel works before you automate it, or you could automate yourself right out of business. Summary Funnels are not generic, although my advice here is. Effective Funnels will be unique to every business, so, unfortunately, I can't provide a step-by-step guide in a blog post that would do much good for you. If I tried, it would not be the proper Funnel for you and could cause more harm than good. But, a firm that builds Sales Funnels all the time, like my company, Forceworks, can help you if you need it.  

About seven years ago we pioneered the "Support by Blocks" model, and it has served our Forceworks clients and us well. But thanks to Microsoft, it is time for a whole new model for Dynamics 365 and Power Platform Support and Services. Let's unpack this one. The Challenge Let's be honest, no business application you can buy will serve your needs as delivered. Any of them will require some modifications to fit your goals. Fortunately, you have many Microsoft Business Applications partners to assist you with this, including my company Forceworks. This is not new; customizing business applications has been around as long as business applications have been around. For a small organization, you may only have to invest a few bucks to get things where you want; enterprise customers often invest six or seven figures to get things right. It is not a small industry that I am in. It is precisely this high cost that has led Microsoft to invest so much into low-no-code technologies. How many more customers could Microsoft have if this "startup cost" was significantly reduced? More on that in a minute. Models There are quite a few engagement models available from different partners. The old "Fixed-Price based on your Requirements" has fallen out of favor, and for good reasons. Scope creep is a common one, but customers, thinking that competitive bidding got them the best price were often surprised at how much the bids came in at—typically ranging from 25-50% higher than what Time and Materials may have cost. Partner risk padding has probably run off many customers, But as I said, few partners even offer this model today. The most prevalent model is the Time and Materials model, which may be based on an estimate. But Scope Creep rears its head just as often there, the difference being that the customer assumes the risk. Still, this usually works out cheaper than what a "Risk-Adjusted" Fixed Price would have been. Blocks Several years ago, we pioneered a variation on the Time and Materials model called "Support by Blocks". In that model, the customer pre-purchased blocks of time, like 80 hours, for example, for a single blended rate that was discounted for their pre-payment. These hours would be consumed by anyone on our team, developers, analysts, consultants, etc., to meet customer requests until the block was depleted. It was a better model for both the customer and us than traditional Time and Materials and has served us well for many years. The downside was that some customers became too focused on the hours, often hoarding them to stave off having to buy more. This also meant that they would never reach the full potential of what these solutions could achieve for them. It was understandable but frustrating for me to know what "could be". It often triggered their "we'll take it from here" reflex when a block was depleted. This always meant the end of the line for any hope of exploiting the full potential for their business. They were obliviously missing out on dollars to save pennies. Is it Time? I have had this idea in my head for many years about an "All-You-Can-Eat" subscription model to eliminate scope and hours from the equation. But to not go broke, you would have to either charge an astronomical amount or exclude the development work. And each time I had looked in the past, there was still way too much development work, relegating any Subscription to just Support. But in the meantime, Microsoft has continued to advance the low-no-code platform, and I was noticing the utilization of our code-writing developers was falling, and developers are some of the highest paid people in a partner organization. To confirm my thinking, we analyzed our customers over the last 18 months, and sure enough, the level of actual code development had continued to drop. In fact, in the previous 12 months, less than five percent of our customers needed any actual code development at all. Bingo! "The Works from Forceworks" I could not wait to take this new information and finally build the model I had been thinking about for years... so I did. "The Works" is that all-inclusive model with unlimited everything except code. One challenge is making sure a prospective customer understands what "Code" means. They seem to feel that anything they could not figure out themselves must be "Code" and fear that anytime they open their mouth, the "Code Alarm" will go off. But our analysis says that is not the case. And frankly, the way you make money on a "Service as a Subscription" is over time, so renewals are far more important than some quick buck made from the code alarm. If that "Code Alarm" goes off too often, or possibly even once, the renewal is at risk. Again, this model would not have been viable even two years ago, so I have to give Microsoft a big hug. The Big Gulp A model like this is not without its risks for us. For one thing, our primary competition was not other partners but rather customers thinking about hiring someone internally. While these people are not easy to find, the thought that they could be found limits what a customer would pay, and it would have to be less than an internal salary. We went with an extensive list of unlimited services, starting from and including deployment(s). There were some heated conversations internally about what could be realistically offered on an unlimited basis for a fixed monthly cost. Still, I pushed for the max, and I happen to own the company. The service does have a one-year term to prevent someone from maxing out capacity in the first month and then canceling. Resellers To work financially, we need scale in both customers and people for a model like this. We had dabbled with some resellers with our "Support by Blocks" model, but I was not happy with the results, both for us and the end customers. Adding a third party in the middle created conflicts. But this new model is perfect for resellers, who are all looking for a recurring revenue component that they can bolt onto their existing billing arrangements with their customers. And since it is "scopeless" and "unlimited", there really is no reason for conflicts. Summary It is early days, but we have already transitioned most of our current customers to this new model and have started onboarding new ones. So, the customer verdict seems to be in on the value proposition. I expect to be underwater for a while financially as we scale up, but I was prepared for that. I am "Betting the Farm" as they say. We are firmly planted in the battle for the limited talent, but even those folks seem to like this model, so I am not too worried about that. In fact, I have another idea for that, but I will let you in on that a little later :) Those of you who know me know that I am not afraid to try new business models, and so far, each one has been better than the last, and I feel stronger about this one than any other. Wish me luck!  

Microsoft Dynamics 365 business applications are fantastic products. Unrivaled power and features and priced accordingly. Are they over-priced? No! Are you over-paying? Maybe. So, let's unpack this one. My Cable Bill Several years ago, I moved into a new home, and shortly afterwards the local cable company salesperson was on the phone. I was easily talked into the "Gold" package because it "included everything" and I suffer from FOMO. After a few months I realized that I only watched about 10 channels out of the 500+ that I was paying for.  Maybe there are other people who watch all 500? Anyway, I was able to slash my cost by about 80% and not miss a thing. But I digress... What can you do Dynamics 365? Out-of-the-box, Dynamics 365 apps bring a ton of features and capabilities. The Enterprise Sales app for example, at $95/pupm, allows you to create and manage Leads, Contacts, Accounts and Opportunities, but it doesn't stop there. Since it is built on Dataverse, it also integrates with Microsoft Teams, and Microsoft Office and the entire Power Platform. You can create Product catalogs and multiple pricelists, along with quotes, orders and invoices. It also includes A.I. capabilities to help you predict sales risks and next best actions to take. For your sales team you can enable guided selling to quicky onboard new sellers and implement best sales practices across your team. With your Dynamics 365 Sales Enterprise license, you can set up and experience Sales Premium features such as Sales accelerator, conversation intelligence, and predictive scoring. There are many more features to explore also. And you can add Dynamics 365 Enterprise Service to this for an additional $20/pupm. But wait a minute... will you use all of these capabilities, or even many of them? If not, maybe Dynamics 365 Sales Professional is a better option. Professional Microsoft also offers Dynamics 365 "Professional" for Sales or Service at $65/pupm. Or you can get both Sales and Service for an additional $20/pupm (total of $85/pupm).  In this "scaled down" version, they have changed a few things. For Sales Professional for example, the following are not included: Competitor tracking, Customization or extending out-of-the-box reports, charts and dashboards, Knowledge base, Embedded AI, Forecasting, Sales Goals, Product families/hierarchies, Product relationships, Business card scanning, Sales Literature, Territories, Sales Teams, Email Engagement, Predictive Forecasting and Relationship analytics. There are also some limitations in place including: a maximum of 15 custom tables, maximum of 5 Business Processes, maximum of 5 custom reports or charts or dashboards, maximum of 2 custom forms or views. Similar limitations apply to Service. But wait a minute... does this still include things you may not use? Are the customization limitations too great for you? Customization Even though Microsoft Dynamics 365, particularly the Enterprise apps, include a boatload of features and capabilities, we still find ourselves working with customers to configure and extend the apps. Adding custom tables and fields, adding new relationships, building new forms and views as well as workflows. We often end up modifying much of what is provided out-of-the-box. All of this in effort to make Dynamics 365 "fit" an individual business' needs. Most of the time these customizations become the priority elements, and much of what was provided out-of-the-box is never used. Every Customer is Different For some customers many of the provided features and capabilities will be utilized. For others, they may just use the basics. For others still, their customization needs are so great that Dynamics 365 really ends up serving as more of a platform to build on.  If you are in the first group, then you are probably not over-paying as you will get the benefit of the features that the price incudes. But if you are in either of the other two groups, you are absolutely over-paying! RapidStartCRM Okay, here's my pitch. Some readers complain when I promote my business, but I gotta eat too. We created RapidStartCRM to address the very issues I described above. RapidStartCRM is a basic Sales and Service app built on the same platform as Dynamics 365. What does that mean? Well, first it means that many of the things that are available for Dynamics 365 are also available for RapidStartCRM, like integration with Microsoft Teams, and Microsoft Office and the entire Power Platform. While the enterprise apps obviously come with many more features, even though they look similar side-by-side, RapidStartCRM will manage your basic Sales and Service needs, which even at the lower Dynamics 365 "Professional" level would cost you $85/pupm.  If you foresee a lot of customizations in your future, RapidStartCRM shines even brighter. Since RapidStartCRM is built on the same Dataverse platform as Dynamics 365 the customization capabilities are the same. RapidStartCRM also has over 70,000 users, about half of which came from either Dynamics 365 or Salesforce.com! Oh, I almost forgot to mention, RapidStartCRM itself is free and runs on a Microsoft Power Apps license will cost you $5/pupm. Why Stop There? Yes, we are exploiting the fact that Dynamics 365 is very expensive and too complex for many users. And yes, we built a low-cost alternative on the same platform right next to Dynamics 365. But then Microsoft gave us a clear path to continue our exploitation with their Dynamics 365 Field Service application at $95/pupm and their Dynamics 365 Project Operations app at $120/pupm. The exact same issues described above apply to both of these apps as well. So, we thank Microsoft for the inspiration and went ahead and built our RapidStartCRM Field Service addon and RapidStartCRM Project Management addon, both priced at $10/pupm. Why so Cheap? Microsoft has basically taken over the business world with their Microsoft 365 products (formerly called Office 365). They offer a very robust set of features for your productivity needs starting at $5/pupm. As a result, many SMB customers and enterprise departments have gravitated to them. When it comes to adding business applications however, too many of these same customers choke when they see the costs. The expected result is that they seek business solutions elsewhere, from other vendors who, while they don't integrate or share the security model of Microsoft 365, they do meet the price criteria! We intentionally priced our top-rated apps, which run completely within your Microsoft cloud environment, to make it easy for you to decide to maximize your Microsoft 365 investment and security. Also, full truth be told, we know that many of you will reach out to us to assist with your support, integration and customization work. If you want to learn more about RapidStartCRM, go here, or hit me up!

I've heard this term bandied about for many years now, "Single Version of the Truth". As Jack Nicholson once said, "You can't handle the Truth!" I would paraphrase that as, "You can't afford a Single version of the Truth, and you wouldn't want it anyway!". So, let's see how many of you I can get to agree on this one :). What is Implied? From a business standpoint, "Single Version of the Truth" or SVT, is often pimped as this utopian idea that all of your data, about everything to do with your customers and your business is in one place. providing the coveted 360-degree customer view. First, no such Utopian application can be subscribed to from anyone on this planet today. However, you can subscribe to several applications and potentially spend an enormous sum of money and time to wire them all together, giving the illusion of a SVT. While some of you might be sad to hear that SVT is not "push-button", I will try to cheer you up by saying you would not want it anyway. Silos are Bad! Yes, if you read back on my blog, you will see me also preaching that data silos are bad. In fact, I used the same post image for this post. But that was then, and this is now. Back in the days before the Power Platform, when all we had was Dynamics 365, we also sang Microsoft's tune of the time that "You want all of your data in one place", meaning in a Dynamics 365 database. This was a strong argument for a customer who was considering multiple point solutions made by vendors other than Microsoft. And we had a great deal of success consolidating those multiple point solutions under a single Dynamics 365 umbrella. But to call that a SVT was a stretch. Maybe "Fewer Versions of the Truth" with a 245-degree view of the customer was a more realistic goal, as that was typically the outcome. Dynamics Silos Even under the Dynamics 365 brand there were, and still are, silos. Dynamics 365 Sales runs on top of Dataverse, while Dynamics 365 Business Central or Dynamics 365 Finance run on their own databases. Dual-write is an ongoing effort to create the SVT illusion. Power Platform The Power Platform arrived and blew up the whole concept of SVT. Even Microsoft started singing a different tune, promoting their Center of Excellence "COE", so you could more easily manage the possibly thousands of environments (aka Data Silos) that users could now create in your enterprise tenant. So, is SVT dead? The problem was never with "Point Solutions" and their siloed data, it was with "Point Solutions" and silos from other vendors. With the Power Platform, Microsoft created a rocket engine to crank out "Point Solutions"... but these would be "inside the wall". Silos are Good! So now let me be my own devil's advocate. I will take our own organization, Forceworks for example. The Sales side of our business watches over AppSource prospects and website prospects etc. You can probably imagine that with over 50K users of our RapidStartCRM app, that means there were way more prospects than that, who did not move forward. So, we have thousands of prospects and most of these will never amount to anything, of course. Not unlike any other business where the number of prospects is typically exponentially higher than the number of actual customers. The Services side of our business works with our actual customers, not every RapidStartCRM user becomes a customer. Our customers are organizations who have engaged us to support or customize not only RapidStartCRM, but also Dynamics 365 or anything Power Platform related. So, our Service database is a fraction of the size of our Sales database. In our case, Sales runs on a customized version of RapidStartCRM in one environment, and Service runs on another customized version of RapidStartCRM in another environment. The rationale? Why should the service team have to navigate around thousands of irrelevant records?  If they are not customers, they don't need to be in the Service silo. But what about Synchronization! Much of "Synchronization" is unnecessary hype. Yet many organizations pay us tons of money to try to achieve it. Flow can handle 90% of what is actually useful. For example, when a prospect in our Sales solution becomes a customer, a simple flow creates the record in the Service solution. If a service customer asks about a new app or service, a simple flow in the service app updates the record in the Sales solution. Unintended Consequences If you have not yet built a flow that acted beyond the scope of what you intended... you have not bult enough flows. Both of our environments have multiple flows, many quite complex, automating a bunch of things. Were all of these in a single environment, the chances of a Service flow accidently scooping in some Sales records for example is much higher. So, flow development becomes much more complex. But what about my 360-degree view of the Customer? Let's face it, you are not going to get around the fact that you will have multiple sources of data. At least with Microsoft, it is possible to have all of those data sources under one roof, which I do not believe can be provided by any other company today. If you really want that 360-degree view, yet another application can give you that, Power BI (Microsoft's Business Intelligence app). Power BI can not only connect, munge together and regurgitate beautiful charts and graphs using data from all of your Microsoft sources, it can bring in most of your external data sources as well. I would still argue that the "360-Degree view" is over-rated, the only positions that might actually need that are very high senior management, and we all know they don't look at data anyway... unless it supports a personal agenda. So that's my take on this. If you are looking to shovel money to someone in pursuit of this dream, hit me up. Or if you just want business applications that "work" for your business, you can also hit me up. Feel free to leave any comment you like, as long as it supports my personal agenda, I am a CEO after all :)  

Microsoft just announced, and released in the next breath, a new Pay as You Go model for Power Apps. This has huge implications for all organizations and also for users of our free  RapidStartCRM solution. Let's unpack what it means. Pay as you go Who doesn't like the idea of only paying for what you use? I wish it applied to more things: "I only ate half of this hamburger, so I'll just you pay half the price", "I only drove my car three days last month, so I'll just pay 10% of my car payment". "I didn't  need to see doctor last year, so I won't pay that health insurance bill." Sadly, most things don't work that way, but some do, like gas for your car, electricity in your home, and now... your critical business applications! What does this mean? This is a new option, in addition to the previous option of licenses. Before, when thinking about users for your applications, you may have pondered whether Sally would use the app often enough to justify paying for a license for her every month. Or those seasonal staffers, or volunteers who use your app sporadically. With this new model, you don't have to think about any of that anymore. You also don't have to worry about getting and assigning new licenses for newly onboarded staff. You just "Share" the app with them. Cost impacts Basically, in the background Microsoft is watching your app. When Bob signs in and uses it, "cha-ching", Bob is added to your monthly bill. If Bob did not use your app next month, he is not added to your bill for that month. Brilliant! So your monthly bill will go up and down based on how many users used your app in the month. For seasonal staff, maybe you see a cost spike in November, but the cost plummets back down in December for example. How do you get it? Well... it depends. Many organizations use Azure for various things and have an existing Azure subscription. Many do not. An Azure subscription is required as that is where the Pay as you go mechanics are located. If you do not have one, you can go here and create one with a credit card. Once you have an Azure Pay as you Go subscription established, you won't necessarily need to go back there, it is kind of a one-time step. It should take about 10 minutes. Environments The next thing you will need to do is decide which environments you want to utilize Pay as you Go for. Then connect those environments to the Azure Pay as you Go subscription. After that you can just share your apps with any users as you do today. But only pay when the apps are used by those users. Questions Yes this begs more questions than it answers, and some of those details are filtering out as I write this. But I have a feeling this will be a game-changer both for Microsoft and RapidStartCRM customers!

Shortly after we launched RapidStartCRM back in 2015, a couple of competitors followed us into the emerging space we identified. They are gone now, but new ones occasionally pop up. I hear "imitation is the sincerest form of flattery". First Mover Advantage As the very first simple-to-use CRM solution built on Microsoft's Business Applications platform, we did have an early advantage. We brought a lot of SMB knowledge to the offering, and SMBs were eating it up. My assumption that there was a market hungry for CRM, but turned off by the complexity of Dynamics 365 or Salesforce.com, proved correct. Even Microsoft was a promotor of RapidStartCRM, seeing it as a path to capture a segment of the market they were never very good at. But the first mover advantage won't carry you forever. While we may be able to forever claim we were the first, it requires ongoing work to continue to claim we are the best. First Users Advantage Being the first to market is important, but having the first users of a new product, is much more valuable. As an SMB ourselves, we could anticipate many needs for a simple CRM, and we incorporated them into the very first version. But our ability to anticipate needs pales in comparison to actual user feedback. While largely the same application (in appearance) that we launched in 2015, there have been over 25 version updates over those years. Every one of those updates was a direct result of feedback from our growing user base. I see what you did there When we launched, there was no "AppSource", the best our potential competitors could do was watch one of our videos to try and reverse-engineer what we were doing. A few tried, some even copying and pasting our web copy. I was mostly annoyed at the sheer laziness of their efforts. It's a little different today, our app is now available to anyone via AppSource, and not surprisingly of the competitors I am aware of today, each of them had installed RapidStartCRM in advance of launching their copies. Some have at least attempted to take a slightly different approach, yet others simply came up with a catchy name and are basically trying to replicate what they think we are doing. One even pretended to be a customer and reached out with questions! Even Microsoft closely dissected and reviewed RapidStartCRM as they were developing the "Business Edition", the "never launched" predecessor to the Dynamics 365 Professional offers. The Missing Link The primary reason we have had so many updates, while our competition seldom gets past their first one, is the over 50,000 users we have on our app. You don't get that many users launching a knockoff with your fingers crossed. Sure our brand recognition for RapidStartCRM is high, but that would not mean anything if the app was not excellent, and continuously updated as new capabilities come out and features are requested, as long as both of those items fit within our mantra of "Simple-to-Use". We closely evaluate any changes, to ensure we don't trip the touchy complexity wire. This is a lesson some of our aspiring competitors should learn as they replicate our concept, but then proceed to add a bunch of crap to it. Simple isn't Easy You would think that building something simple should be easier than building something advanced... it's not. Even with Microsoft's vast resources, the Dynamics 365 Professional apps that they positioned for SMB, missed the simplicity mark by a mile. The fact that so many SMBs are using the professional apps is a testament more to Microsoft's marketing might, than the apps being appropriate for most of their SMB customers. It's funny how our roles have reversed. When they were first promoting RapidStartCRM it was with an eye towards eventually moving those new customers to Dynamics 365. Instead, many Dynamics 365 customers are moving to RapidStartCRM. Of course I knew this would happen, but I continued to smile as they told me about "their" plans for RapidStartCRM. It's about the Churn In the SaaS software business "Churn" is a critical number. Basically it means that while you successfully sold a customer on your product (Yay!)... they cancelled shortly thereafter (Boo!). While Microsoft does not publish their churn rates, I am aware that for SMB customers, over the years, the churn rate for Business Applications has been very high. Not surprising since Microsoft cannot not grasp the concept of "Simple", a natural by-product of an organization comprised of thousands of engineers. RapidStartCRM's churn rate on the other hand is near zero, the one exception being future competitors of course. Healthy Competition While anyone would want to have a monopoly in their space, it is not realistic in a free enterprise economy. I look forward to "healthy" competition, something that moves the needle forward. But for now, I guess we will have to continue being the ones who move the needle, because knockoffs don't move anything. If you are thinking about a Simple CRM, think RapidStartCRM, the first, with the most users, and still the best, Simple-to-Use CRM built on the Microsoft Power Platform.

It seems like a couple of times a week I get a panicked message from a customer who saw the dreaded alert: "Your organization (tenant) is over capacity" in the Power Platform Admin Center. Sometimes they are over a little, and sometimes they are using 500% or more of their allocated capacity. Let's chat about this shall we? Capacity We still have a handful of customers on the "Old Model", the combined "Extra Storage" SKU. If I recall it was $10 USD/GB... and people complained about that. Recently Microsoft changed from the "Additional Storage" model to a "Capacity" model. In the process they split the storage buffet into three entrées: Database Capacity, File Capacity and Log Capacity. They also changed the pricing... significantly. Additional Database Capacity will cost you $40/GB/Month, additional File Capacity goes for a mere $2/GB/Month, and additional Log Capacity comes in at $10/GB/Month. Truing up can be an expensive proposition. What will happen? The first concern of customers seeing this ominous alert is that their business applications will suddenly stop functioning. Clearly this would not be good for Microsoft's business relationship with that customer. So nothing currently running will "stop". However you may notice that will not be able to create new environments, or copy or restore environments, while you are over-capacity. It is not clear if there are any other things that may be happening like throttling your speed, etc., but regardless, you are out of compliance. So while not something you need to solve immediately, you do want to solve it. If you have an urgent issue like needing to copy or restore an environment while you are over capacity, you can request a 30-day extension. Buying your way out For some customers, the least expensive option is to simply buy your way out of capacity debt. We recently had a customer with about 100 Sales Professional licenses inquire whether moving to the Enterprise Sales licenses would be an option. Not a chance, in their case the cost was almost triple, and only got them halfway there. So how much do you get? Many Dynamics 365 customers have no idea how much storage capacity they have, or how they got it. You can get a better understanding in the Power Platform Admin Center. Here is an example screenshot of a tough situation: As you can see this customer is way over their allotment. On the right side you can see how they got their allotment, including their default capacities, additional capacity via additional user licenses (not all licenses include this), and any extra Capacity they may have purchased, all of which sum up to their totals. In this case this customer has quite a few users, but most are on Dynamics 365 "Professional" licenses, which add no capacity. We estimated their cost to true up by just buying the capacity needed with a small cushion would be about $3,300/month. Wow! Alternatives There are several things you can do to help this situation. First we'll tackle the low-hanging fruit, that I can immediately see is their Log storage, which is about 700% over. Since log storage is not very expensive, their cost to get right-side up on this is not that much, about $160/month, so it is not worth having "our" team do anything. But on their own, they can delete some of their old logs, or if they need them, export them out to cold (cheap) storage. They can also look at "what" they are logging to make sure each item needs to be logged, they may have hit the ole "Check all" option when they set it up. The next item to look at is File where they are about 422% over. Again, their cost to get right-side up on this is not that much, about $300/month. On their own they can run some advanced find queries and delete unneeded email and note attachments, and just pay the difference. The cost to do more, would not have an ROI. Lastly, we come to the real problem... Database, where they are also about 435% over.  This would be expensive to buy out of @$40/GB, about $3,000/month! This is an area worth having our team dig in and see what can be done... and we did. Solutions and Addons The first thing to understand is that your "Database" holds more than just "your" data. Any solutions you have installed also consume this, including the Dynamics apps themselves. Kind of like how your 16GB iPhone only has like 12GB available before you even touch it. It might seem like there is nothing you can do about this, but if you are not using all of the advanced features of your Dynamics 365 apps, you may want to try RapidStartCRM with it's much smaller solution footprint. Speaking of solutions, and the capacity they consume, you should definitely review any addon solutions you may have installed and are not using anymore. Just delete them. For those you need, make sure you are on the latest versions, as many ISV's have made their code more efficient now that capacity is an issue. If you have some old addons, with no recent updates, you may want to consider switching them for more modern ones with similar capabilities. If you are stuck with an old addon for some reason, maybe hire a developer like us to do a code review. Again, the Capacity issue is recent, previously ISVs for addons did not really worry much about storage, so efficient code was not a priority. Normal Data Of course every time a new record, like a Contact for example, is added, all of the data entered into each of those fields is added to the database. So think about all of the records you have, not just the obvious ones like Accounts and Contacts, but also activities, etc. it creates a huge pile of data. Of that huge pile, your team is probably only engaging with a fraction of it on a daily basis. Before capacity was an issue, there was no reason not to keep 10 year-old emails, but now you have to think about it. The same goes for any "inactive" records. The first question is "Do I need this at all?", if the answer is still "yes", then the next question is "Do I need it to be in here?". Probably not. It may make sense to archive that data to cold (cheap) storage. Bonus result: your system will run faster! Transactional Data Some customers generate enormous volumes of "Transactional" data, often automatically imported via an integration. Do you need to see each of these transactions in your database, or would a summary of totals do the trick? If you do need to see it all, could it be moved to "colder" storage and accessed by your users via "Virtual Tables". Import History When you import a csv or other data file into your Dataverse environment, like via data import in Dynamics 365, that excel or other file remains behind after it has been parsed and added as records. You can free up some space by deleting these import files, just make sure you don't check to "delete all records imported" also. Indexes Here's another thing you can look at that could have an impact. If Quick Find lookups are configured for data that's frequently used, this will also create additional capacity-hungry indexes in the database. Admin-configured Quick Find values can increase the size of the indexes based on: The number of columns chosen and the data type of those columns. The volume of rows for the tables and columns. The complexity of the database structure. Because custom Quick Find lookups are created by an admin in the org, these can be user-controlled. Admins can reduce some of the storage used by these custom indexes by doing the following: Removing unneeded columns and/or tables Eliminating multiline text columns from inclusion Bulk Delete Jobs You can create bulk delete jobs for two things, first for the initial cleaning up, and second to help to keep clean. You can use bulk delete to clear out old records of all kinds initially, old emails or attachments, completed system jobs, etc. Afterwards, you can them be recurring, so they automatically clear this old data on your schedule. Unused Environments All environments consume a minimum of 1GB... even if they don't have a Dataverse database. So you should regularly review your list of environments in the Power Platform Admin Center, and remove any that are not being actively used. Even some that are being used, should be reviewed to make sure they are necessary. Be aware, that unless you have deactivated the capability, by default any user in your organization can create an environment. We frequently find environment "experiments" that were created, and abandoned by users, including users who are no longer with the organization! Note that Default, Production, and Sandbox environments are all counted for capacity, however Trial, Preview, Support, and Developer environments are not counted. Conclusion If after doing all of these things, you are still over-capacity, you may have no option but to buy more. Depending on your specific scenario, some or all of these steps may have significant to very little effect. But it's definitely worth a try. Based on the potential expense, we saw a new business opportunity and recently launched puredata.estate. Maybe we can help you.

One of the smartest things I have done in a while was to introduce a monthly Principals call with our customers. Our customers are all very happy with our team, so why rock the boat by injecting myself? For the same reason I might tell the waiter that my food is "fine" when it isn't. The Owner's Dilemma Every single day people go into a restaurant and have a sub-par meal. It seems the wait staff everywhere has been trained to ask leading questions, like "isn't your steak great?", with a huge smile on their face. Like many people, it's easier to just say "it's fine", rather than interfere with their smile. Instead, I just make a decision to not come back. Meanwhile, the owner asks smiley how things are going, and they reply, "Well people seem to love your food!". Which leaves the owner wondering why sales are down. Our sales are fine, but I'm not taking any chances. How's it Going? I have no interest in a "feel good" conversation with my customers. Instead, I am more like a Business Applications detective, asking hard questions, probing for the real issues. It was on one of these recent Principals calls that a customer conceded that they were having adoption problems. Ugh... the perennial bane of Business Applications. This particular customer was on Dynamics 365. In addition, they had bought basically everything that Microsoft business applications group offers, including Dynamics 365 Marketing, Customer Insights, Power B.I., oh... and a few more "Insights". They had also built out an extensive user training library. It seems like they had done everything possible to insure adoption, yet for a particular group they were struggling. Carrot, Stick or Both The usual way most organizations approach adoption is, "Use it, or else". Or else what? This seems to range from, "you'll get a reprimand (oh no!)" to "you're fired (oh shit!)", with a lot of options in between. The growth in "work from home" has not helped the adoption challenge. A few other organizations try the more "touchy/feely" approach. "If you use the system, we'll enter you in a drawing for a "NEW CAR!!!" And still other organizations use both, you either get a new car, or you get fired. (You have to say that in your best Alec Baldwin voice.) Damn Salespeople Most organizations have workable adoption from their administrative staff, and pretty good adoption from their support staff. It never fails, when I hear this concern, it is always related to the sales staff. For this particular customer they had an even bigger challenge in that their key sales staff is made up older "Rainmakers". Rainmakers Most businesses have a sales team. Within that team you have mostly average sales people, but often there will be a few that make most of your sales. The 80/20 rule applies. These are your "Rainmakers". Any other salesperson could quit and you wouldn't bat an eye, but if a Rainmaker quit... it would keep you up at night. Rainmakers are rainmakers because they are smart, and smart enough to know that they are Rainmakers... with leverage. The kind of leverage that, if they don't use your system, they know nothing will happen. They are completely unmotivated by your pleas to track their sales activities. So your forecasts are shit. Whether you are heading for your record high month, or record low month, you won't discover until the following month. Herein lies the challenge. Attempts so Far The Rainmaker challenge was not lost on this customer, and they initiated several efforts to overcome it. More training materials of course, and an ongoing effort to make their apps simpler to use. Not unimportant, but not effective either. In my experience the only way to motivate a Rainmaker is to provide them with a tool that makes them more money by using it, than not. Full Stop! Easier said than done, but all other efforts are window dressing. Some Ideas for thought Vlad, a Principal in our organization on the call, suggested playing to ego as one idea. If you know you are are a Rainmaker and won't be fired, it can definitely swell your self-importance, leading to exponential ego growth. If you have been to a car dealer, you may have seen "The Board". Usually a white board visible to all salespeople showing who is at the top in sales so far that month. While Rainmakers will always be in the top 3, being at the very top is food for their ego. Motivation and Manipulation are often the same thing. Vlad's thought was to start tracking the leaderboard, and sending periodic notices to the sales team to login to see it. While there is no silver bullet for adoption, this could motivate a segment. Day in the Life Another more abstract idea of mine was more in the line of making them more money by using the system, shifting from their Ego to their Greed. Maybe you are offended by that term, but let's be honest, the best salespeople are usually greedy egomaniacs, and most companies need them anyway. Most of them also have their "secret sauce", their unique "process" if you will. If you understand their process, you can use your system to possibly grease their wheels for them. In many cases, getting them to share their secrets may be a challenge, so some forensic analysis on their past wins may provide some clues. The goal is to give them a self-serving reason to use the system. Outlook and Memory I find that many of these Rainmakers use a combination of Outlook and their memory to manage their pipeline. Ask any of them how well that is working for them and they will all say "Great! The only way I have ever done it!". Newsflash, your memory is shit, and Outlook is a mail program that can't keep track of anything. If they had ten deals going on, they probably could not name six of them off the top of their head. The four they would remember are the ones closest to becoming money in their pockets. These may not even be the best deals financially for them, they are just the closest. It's Sales Human Nature. So my goal was not to "solve" you adoption issues in this post, but spark some ideas. I would love to hear your other Rainmaker adoption ideas in the comments below.  

I have had my head down for a while working on the next version of RapidStartCRM. We also recently deployed RapidStartCRM for our own support operations. In the process, I came across a few items that I thought would be of interest to the users of our free app, and since they would also work for any Power App, including Dynamics 365, I thought I might discuss them. Next Version Before I get into this, I want to clarify what I mean by "Next Version" of RapidStartCRM. We have been developing this product since 2015 when we launched it a the Worldwide Partner Conference (Now called Inspire). Over the years we had made hundreds of updates and tweaks in direct response to users. We also refactored the solution a couple of years ago to run on the low cost Power Apps licenses in addition to Dynamics 365. Each update, with the exception of the refactoring, had progressively fewer changes as we honed in on our target customers' requirements. I am pleased to inform you that the next version will have the fewest tweaks yet... I mean it is damn near perfect already. So let's get back to our internal project. Forceworks Support We had been running our support operation on Dynamics 365 Customer Engagement for over 10 years. Several times I had contemplated moving it to RapidStartCRM, but as a certified partner my licenses were free, so I kept putting it on the back burner. Our support operation is not very complicated. Customers buy blocks of hours which we add to their bank, and we track our activities against those blocks. We also maintain a portal where customers can login and see their bank balance as well as review all activities. We had been using a third-party portal since before Microsoft even contemplated a portal product. The portal company had been purchased by another company for other assets of value to them and the portal product came with the package.  But portals was not a priority for them. I figured it was a matter of time before they shut it down. So the time had come to move. Dynamics 365 So, as I said I get Dynamics 365 licenses at no cost. So it might seem an obvious choice just to fire up a Power Apps Portal and connect it to our existing instance. and be done. However, as years have gone by now with us supporting customers on RapidStartCRM, many of whom had moved to it from Dynamics 365, I have come to not really like Microsoft's first-party apps very much. I truly feel they are unnecessarily complicated and bloated. And while my licenses may be free, any additional database capacity is not. Our instance, even though it was not doing all that much, was consuming the lion's share of our capacity. So I made the decision to "upgrade" our support operation off of Dynamics 365 and on to our own RapidStartCRM. Also, Power Apps Portals works the same on RapidStartCRM, so there was no reason to continue with the bloated beast. And, if for some reason I was no longer getting free licenses, my cost would be about $10 vs. $95 per user... a factor in many other customers' "upgrading". Migration We could have done this upgrade/migration in a day, but I took this opportunity to make some improvements to our process. Mainly around automation, nothing we could not have done before, but this was a good time, since we were opening things up. We started with the same RapidStartCRM solution as our customers get, and installed it from AppSource on a new environment the same way any customer would. We made use of the RapidStartCRM Accounts, Contacts and Cases. We created two custom Tables, one for Case Notes, to track time and activities, and one for Support Hours, to track the customers' purchases and banks. We also created several Cloud Flows with Power Automate... things like calculating hours and various customer notifications. In addition, we added some specific charts to the RapidStartCRM dashboards for quickly getting a view of things. We also tweaked the RapidStartCRM App to hide Opportunities and a couple of other items we were not using for this need. Lastly, we mapped and migrated all of our historical data to the new environment. I didn't even pause before I hit the "delete" button on our old bloated environment we had depended on for 10 years. Portals So I mentioned that Microsoft offers a Power Apps Portal. Again, for me it would cost nothing. Depending our your requirements, it might be a good solution for you. Unfortunately, like everything the Microsoft Business Applications group produces... it is more complicated than necessary. This is even more noticeable when your requirements are simple. Our requirement was to have a place customers could log into and see their account information, purchase history, case information and case notes. I wanted it to be clean, simple and easy to maintain. Not too complicated. Our Forceworks main website runs on WordPress, like so many other small to mid-sized businesses. So my preference was a WordPress based portal. My friend, and fellow MVP, George Doubinski had the answer. The AlexaCRM WordPress integration solution. Using Alexa, we are able to display any information we want from our RapidStartCRM environment on any WordPress posts or pages. For us, it was a better solution. AlexaCRM can do much more, I am aware of customers running full eCommerce portals with it! If you let George know that you heard about his solution from this post, he promised me he would sing you a short song of your choice. Power Automate Our previous environment had used classic workflows for everything, so this was a good time to move those to Power Automate Cloud Flows. However, I am not 100% sold on Power Automate... yet. Classic workflows still exist because Microsoft has not yet reached parity with Power Automate to be able to turn them off. The "Fullness of Time" does seem to be quite full indeed. But I decided to use Cloud Flows wherever possible. It seems that every time I look for a connector in their expansive list of hundreds, it either does not exist, or does not do what I need it to. This was the case for WordPress also. The connector exists... but is essentially useless. Once again, a fellow MVP to the rescue. Heidi Nuehauser is working with Nick Hance at Reenhanced, and they have a rock-solid Power Automate connector for WordPress that can be used with either Gravity Forms or Contact 7 forms on your WordPress site. If you use the code FORCEWORKS, you can try it out for a month for free. BTW, I did not actually need the Reenhanced connector for our Support site, but while I was under the hood, I decided to update all of the forms on our main Forceworks and RapidStartCRM websites. So now all forms submitted create a record in Dataverse automagically. Results Since our Support Portal is not public (unless you want to buy some hours), I added some screenshots below for your reference. If you would be interested in a similar solution, please contact Forceworks. Account Summary Page   Cases Page Case Details Page

I have had my head down working on some big things, and it has been a while since you heard from me. Well, I'm getting back to it with a follow-up chat with Toby Bowers, the Leader of the Microsoft Bizapps ISV Program. I managed to catch him in his car, and got a great update on some new things happening in the ISV arena. Enjoy! Transcript Below: Toby: Hi, this is Toby. Steve: Hey Toby, Steve Mordue, how's it going? Toby: Hey, Steve. I'm doing well. Thanks. How are you? Steve: Not too bad. I catch you at a decent time? Toby: You've caught me at a fine time. I'm actually in the car at the moment. I'm just taking my team out for a little celebratory launch after our big Inspire event and also our Ready event earlier this week. So it's actually a good time. Let me just pull over so we can have a chat. Steve: It's Been a pretty frantic couple of weeks for you guys. Toby: Frantic, but good. Yeah. Yeah. We had a great showing at Inspire. We made some exciting announcements across the business applications business, but especially around our ISV program, ISV Connect, as you and I have chatted about before. So, it's been good. Steve: Well that's [crosstalk 00:00:50]- Toby: How about you [crosstalk 00:00:51]. Steve: [crosstalk 00:00:51] the reason for my call is to try and catch up on ISV Connect. We talked some time ago about some things that you kind of had just inherited this role from Googs who moved on and were kind of getting your feet wet. Now you've had a close to a year in this position, right? Toby: Yeah, that's right. That's right. I remember our initial chat and I think in fact I'm guilty, Steve, because we agreed to speak a little bit more often, but it's been an interesting year this past year, as we all know, but yeah, it's been almost a full year of execution since we last spoke and I even remember Steve, the nice article you wrote with some suggestions for me as I sort of took over. Toby: Yeah, I'd love to actually go back to that. We can talk about a little bit about some of the enhancements and announcements that we made last week. Steve: Yeah. I mean last week, I think for a lot of the ISV's that they weren't thrilled with some things as the program got launched, they were starting to kind of get their arms around it. But some of these announcements that I was hearing and hopefully we can talk about today, anything of course isn't NDA, I think should make the ISV community pretty happy. It's making me pretty happy. And really kind of throw some gas on that fire. Toby: Yeah. Well, absolutely. I'd love to reinforce it. I know, I know you get a lot of people listening to your impromptu calls here. So why don't I do this? Let me maybe just set a little bit of context, just kind of where we left off Steve, and then I can hit on the high notes of what we announced and then we can dive into any particular areas. That sound all right? Steve: Yeah. You are pulled over, right? Toby: I am pulled over now, yes. Steve: Okay. Toby: You got my full attention. Steve: All right sure, kind of hit some of the highlights. Toby: Yeah. Yeah, for sure. Well, for those who don't know, we originally set out with the ISV Connect program a couple of years ago to attract ISV's to our platform, building and extending upon it. That platform being both Dynamics 365 and the power platform with a specific focus on partners who had great industry or vertical IP to enhance the portfolio and delivering better value to our joint customers. So through the program itself, it's a revenue share program and we reinvest back in the ecosystem in the form of platform benefits, go to market benefits, co-selling with our field. Toby: So when I sort of took over Steve, I wanted to sort of get a full year of execution in place. And in that first year we were pretty happy with the numbers. We have over 700 ISV's enrolled in the program. Now we use AppSource as sort of the cornerstone of the program. We have, we have 1400 apps or more certified in AppSource. But after that first year, I really with the team wanted to understand how things were landing, and I think your feedback was good Steve. We did a bunch of research. We do partner satisfaction surveys. I of course talked to a lot of partners in my travels. Steve: [crosstalk 00:03:59] in a year's time, you can kind of get a pretty good gauge on what was working well? What could work better? What wasn't working well? What do we need to just abandon? What do we need to step on? And I kind of got the feeling that was this readjustment that we just saw was kind of bringing some of those things to light. Toby: That's exactly right Steve. I mean, it's such a diverse ecosystem of emerging partners to large mature partners across a pretty vast portfolio. So, it was a diverse set of feedback, but you're spot on. We wanted to give it a little bit of time, but then check in and listen and make some adjustments. So that's what we did, based on a lot of the feedback we got. Toby: I'd sort of summarize what we changed in three big areas Steve, the first is that the business model itself, the fee structure, and we talked about this last time, but not only having an investible model where you can reinvest, but actually investing in the ecosystem, especially as it's growing like this business is growing. Toby: The second thing was a lot of feedback around the go to market, whether it was the marketing benefits, the co-selling with our field, really just getting that value proposition right Steve, and really delivering on the promise we made. We needed to balance that equation a little bit and equalize the effort. Toby: And then the third piece is really around the platform itself. And again, we've talked about this in the past, but just the platform, the tooling, dev test environments, app sources, and marketplace itself. Toby: So those were the three key areas that we sort of listened and got a lot of good feedback around. So with that in mind, what we actually announced at the event is that first of all, back on the business model we're significantly reducing the rev share fees down from 10 and 20%, which you might recall, we had a standard tier and a premium tier. So we were bringing those fees down from 10 and 20% to 3%, just a flat 3% going forward. Steve: That's across the board? Toby: That's across the board. And in fact, it was part of a broader announcement we made as Microsoft, Steve, where we're also bringing our commercial marketplace fees, so that's both Azure Marketplace and app sources. We get transact capabilities down to that same flat 3%. Steve: So what's the motivation behind that? I mean, what is it that they're hoping that will accomplish for Microsoft? Toby: Yeah, it's interesting. If you catch any of the sessions, even starting with Satya, he really talks about Microsoft wanting to be the platform for platform creators. And then if you parlay that into what Nick Parker said and Charlotte Marconi around being the best platform for partners to do business on, it really just came down to helping the partners keep more of their margin to invest in their growth. Toby: So it's not a P&L, a profit center for Microsoft. It's a way to deliver benefits. We think it's pretty differentiated in the market compared to some of our peers. And it was sort of interesting to see, because we were planning on bringing the fees down for ISV Connect specifically, and then we started to align across the organization and just thought, gosh, we should just do this in a very consistent way across the entire Microsoft Cloud with that one flat 3%. Steve: So the math equation had to work out something like, if we dropped this to 3%, that's going to grow that side of the business significantly, which is going to increase platform sales, right? There has to be an up for the down. And I guess maybe... I mean, not that the platform wasn't already growing by leaps and bounds, but somebody must've been thinking this thing can grow a lot faster if we get rid of some of these hurdles. Toby: You're exactly right. I mean, it's kind of what we've talked about in the past. Just the value that an ISV ecosystem brings to Microsoft with that, whether it's the industry relevance, industry specific IP, or just a growing ecosystem in general. I don't know if you'd caught what we just did, our earnings earlier this week, but Dynamics 365 is growing 43% year over year, we doubled our power apps customer base. And so to your point, the business is growing, the platform is growing, and we want the ecosystem to grow and we want to attract as many partners to do that as possible. Steve: So, I mean, you can't reduce fees and increase the benefit, you have to have taken some things away or maybe gotten rid of some things that weren't being utilized, or how did that kind of offset? Toby: Yeah. Great question. Yeah, so we are investing deliberately to build this out and kind of putting our money where our mouth is, but we did, you're spot on. We learned a lot around the benefits, the go to market benefits in particular, the second key thing we announced is that we are reducing just down to one tier at that flat 3%. So no more 10% and 20% or a standard and a premium tier. And we're reducing the thresholds within that one tier for partners to unlock those go to market benefits and those marketing benefits. And then what I heard, especially from partners, again, to my point around, you've got some mature partners and some emerging partners, it's not a one size fits all. And so we've got an option sort of an, a lA carte, option for partners to choose marketing benefits that make the most sense for their business. So we just tried to simplify things and streamline things a little bit. Steve: You know, I talked to a lot of partners. We're, kind of unique in that our application is free. So, the revenue shared didn't really come into play for what we were doing because there wasn't a fee for our app or any recurring services with it. But you know, a lot of these ISV's their business is significantly different. They've got revenue generating applications that run on top of your platform. Many of them that kind of told me in confidence that they just weren't paying the fees. They were getting the notice from Microsoft saying, "Hey, please do us a favor and tell us how much money you've made and what you owe us." And many of them were just kind of ignoring that. Steve: I guess if we're getting down into a 3% range, it'd probably make it a little easier for some people to be more honest about things too you think? Toby: Yeah. Well, yeah we hope so. Again, that was kind of my point around balancing the equation and making sure that we're delivering on the promise that we set out with the program itself. And I talked to a lot of partners as well, and there's definitely benefit being realized, whether it's from a marketing perspective or co-selling with our field, again, based on what's important to their business, but you're right, we do think by reducing it to this level and also just getting better at delivering the benefits in a consistent way, we'll have more partners participating in the program. Toby: The one thing I would say, Steve, that I was just going to close off on with this sort of consistency across Microsoft is we also realized that's our value proposition. If we can not only have a similar model with the 3% marketplace fee and ISV Connect fees across Microsoft, but a similar model to the way we deliver those benefits, to the way we engage with technical resources or engage from a co-selling perspective across Azure Teams and 365 Dynamics Power Platform, that's kind of how we differentiate ourselves versus, the rest of the players out in the market. Toby: So we made a bunch of enhancements and announcements across the business Azure teams, ISV Connect obviously, and you'll see us continue to sort of work towards a much more consistent approach from a Microsoft Cloud perspective, because obviously we'd love it if partners were integrating with Teams. We have over 250 million monthly active users with Teams now driving dynamics integrations all the way through to CDM and Dataverse and integration into Azure Synapse. Those are the partners we want to work with and the type of partners we want to support and go to market with. Steve: Well, I'll tell you, I think the 3% has probably eliminated a hurdle for a partner, certainly I remember at the time a lot of partners complaining about the 10 and 20 saying things like, "If it was like three." Okay, well it's three now, so shut up and move forward. Toby: Yeah. We've had a lot of- Steve: And it's interesting, because it's kind of the way we sell is I guess for an industry ISV who built something specifically for Dynamics 365, maybe they approach things a little different. Our approach is more, we really try and sell the potential of the platform because we've got a simple CRM. So we're up against a lot of competing simple CRMs. And when you open one of their CRMs and open, rapid start, for example, they look very similar and do very similar things. So for us, we really have to sell the value proposition of, hey, behind that little CRM that you're using from Acme Cloud CRM company is really nothing. You've got the extent of what you can do with that right there in front of you and there's nothing more that can be done, and we really lean in hard on the potential for things like integration with Teams, with things like integration with Azure. Steve: Obviously the integration with Microsoft 365, all of the pieces that are available in the power platform that we haven't enabled in our app that are there to be enabled, you like the forums and some of the AI stuff, it definitely seems to be a huge differentiator in that sales conversation. Toby: Yeah. Well, that's great to hear that's really what we're trying to get right and stitch together the teams if they exist across Microsoft and iron those out. I think your company is a great example of that Steve, and I know you talked to a bunch of our partners and sort of as an independent third party, we had a few partners join us at inspire. Icertis has been a longstanding partner of ours. They're a similar story from, from Azure Dynamics Teams really across the board, and getting more and more focused on industry solutions with their particular IP. Toby: And then we had more emerging partners like Karma, Frank at Karma talked to us about some of the benefits we're building into the platform, specifically license management, and now he's taken advantage of that. And we have big partners like Sycor, that's been working with us for a long time on the Azure side of the business and is doing some really interesting things now on the dynamic side and sees value in that co-sell motion. Toby: So I think that value prop is what we're trying to land, and then we're seeing lots of different types of partners take advantage of it in different ways, which is great to see. Steve: Yeah, it's not often that you see both a cost of participation come down and the value of the benefits go up. And when we talk about benefits, and before, you and I have talked about some of these go to market benefits, there's a segment of ISV's that could make use of those probably mostly new ISV's that don't really understand that system. Steve: But for a lot of the ISV's, they really didn't see value there, but in the meantime they're maintaining their own licensing systems and their own transaction systems and things like that, which as an ISV, that's just like a tax. You're building your solution to solve a particular problem, but you can't just stop after you built this wonderful solution, you got to protect it, you got to monetize it. So those things ended up being just kind of attacks. Steve: And, every ISV out there has had to kind of build their own system for licensing and transacting. And you guys coming through now recently here would be with the licensing capability we were in that pilot, and that thing's got some great potential, a couple of things left for them to do on that to get that really where it's going to solve a lot of problems that ISV's have had, even with their own licensing. Steve: Because with your own external licensing system, you can only do so much, but working with one that's on the platform, that's essentially the same one you guys are utilizing, is going to be huge for ISV's, and then we'll get to transactability, that's just going to close another piece that ISV's have had to deal with, especially when you talk about those startup ISV's, they know an industry and they can build an app, but when it comes to licensing and transacting, and if they can just tick a button and plug right into a couple of those things, that's going to lower the bar to entry and make it a lot easier for some of those folks to get in I think. Toby: Yeah, I hope that you're right Steve, in fact, I didn't know you were working with Julian Payor and the team on piloting the license management stuff. It's great to hear your feedback. That was kind of the whole intent with the journey. If I rewind a bit with AppSource itself, you'll recall we had to do quite a bit of work on the overall user experience for AppSource. We worked hard with the engineering team to improve that, improve discoverability and search capabilities and just sort of the plumbing underneath. And then the next step was, was licensed management, which we've just GA'd working again with the engineering team, and then from there, to your point, the value proposition, a lot of ISV's put all this together and then you add transactability and the ability to actually sell your stuff on our marketplace to what's now more than 4 million monthly shoppers, going to that destination is it is definitely a point of value that I've heard positive feedback from ISV's on. Toby: So that's why we really invested there. I know it's taking us a little bit of time to get there, but that was another key announcement. We announced license management later in the fiscal year. We'll have translatability and AppSource for our customer engagement apps, for power apps, and then we'll continue to roll out a roadmap from there. Toby: And then the other piece I forgot to mention Steve, we made some noise about as well, was these new sandbox environments. And I know you've given me this feedback before, but you know, sort of in the broader internal use rights world, the value in having sandbox environments for our partners to do dev tests and do customer demos around, I heard loud and clear from you and from other partners. And so that's the other thing we announced. We have these new discounted skews, which are basically just at cost skews across the business for those dev test environments. And then for partners who are participating in ISV Connect and hitting those new lower reduced rev share thresholds, we'll provide those licenses for free. Toby: So we think that's going to be a great new benefit for partners as well, more on that technical and platform side of things. Steve: Yeah. Particularly for the ISV's, because ISV's don't necessarily see a lot of value or need to get Microsoft competencies. Competencies are definitely, as a program that was designed for resellers to demonstrate their competence. But a lot of ISV's don't want to have a need for that. And that's where [inaudible 00:19:22] had historically kind of been tied was to those competencies. Steve: So is there any talk about any sort of... I mean, they did do that kind of short-lived ISV competency, which was primarily around, hey, if you've got an app in AppSource you qualify. Here's some IUR. Steve: So this new program will replace that, but are they going to be revisiting any sort ISV competencies or need? Toby: Yeah, well I won't say too much as far as future plans are concerned, but what I can say Steve is that we did this for biz apps, we did it for ISV Connect because that's our program and we got feedback and we think there's value in that. Toby: I did mention that going forward we'll have a more consistent approach across Microsoft Cloud. There's lots of different benefits out there. Azure Credits, we announced some new things around Teams. And so we just need to, as one Microsoft, provide that to our partners in a consistent delivery through these benefits so that we can support that kind of value proposition we talked about earlier. So look for more from us in that area. You're spot on, on the competency side. And I wouldn't even say resellers, I'd say more SI, system integrators services partners. Steve: Yeah. Toby: The key difference there is, we want those guys to be able to differentiate their organization. As a company, you can say, "I've got 15 certified individuals in this role-based certification. And I've got this many credits to my business that make me a gold partner at an organization level"- Steve: Which is something a customer looking at SI would be looking for. Toby: Right. Steve: But when you're looking at an ISV solution, they're really just looking at the functionality. Toby: It's the app, right? You would want to badge in app versus badge and organization. And so that's the key difference there. And I think we've kind of figured that out and again, you'll see us do more in that space going forward. Steve: Yeah. I just want to mention, just go back for a second to make sure everybody is aware that the transactability and the licensing are optional. These are things that you can take advantage of if you spend a ton of money on your own systems, nobody's going to expect you to rip and replace. These are really designed for... I mean when I think of a partner like myself, if I can get out of the license management and have transactability just be automatic, where all I really have to do is focus on building my IP, getting it in AppSource, hopefully promoting it properly, but then the licensing becomes automatic and the transactability becomes automatic, and I'm just getting money coming into my account. Of course, you guys are scraping your 3%, which I don't begrudge because your given me those tools. That just makes things a lot easier. Toby: That's right. And you're right, it's not mandatory. It's again what makes sense for the partner. And so, you can do business with us and ISV Connect outside of the marketplace and work with us on the new 3%, get those benefits, or you can transact in the marketplace, it's that same 3%. And it's a different benefit. You get that whole commerce system, you get that whole billing engine. You don't have to worry about that. And there's a lot of ISV's out there that see value in that. So yeah, you're spot on. Steve: Yeah. I remember Goose had kind of recharacterized the revenue share after the kind of flap up from some of the ISV's about the benefits and stuff and he recharacterized it as a cost for the use of the platform that you're building on top of a platform that Microsoft has built, Microsoft maintains, Microsoft advances. So look at that as a cost for that. And I think you still kind of need to look at that as a cost for that. It's not 3% for licensing and transactability, it's a cost for maintaining the platform, there's these pieces you can take advantage of or not. But if you're not taking advantage of license management, transactability, it doesn't mean you don't have to pay the fee. You're paying the fee for something else. Toby: Yeah. Steve: I'm trying to head off some things I know I may hear from some folks [inaudible 00:23:24] licensing. No, no, no. Toby: Yeah, yeah, yeah. You're right. You're right, Steve, and again, to zoom back out again, I mean, it's not about the 3%, it's about attracting partners to build on the broader Microsoft Cloud and supporting their business in a way that works for them. And you're right, there is a cost of doing that, but we want to invest, and I think we just sent a message hopefully to the market that we want to be aggressive in this space, we think we're well positioned, we've got a great value proposition with this broader Microsoft Cloud thing that we're just seeing incredible growth across the business. Toby: And I guess most importantly, we're listening back to that, after a full year, really sort of staying in tune to feedback from partners like yourself, that [inaudible 00:24:07] at large to make sure that we're doing the right thing and delivering, that's kind of what was most important to me. Steve: So those discounted skews for ISV's, in order to qualify for that, what do they need to do? They need to join ISV Connect? Toby: Yeah. So the discounted licenses, which are again, just basically at cost for us, are available to anyone who's enrolled in ISV Connect. All you need to do is enroll in the program, but then if you hit the new reduced rev share threshold that sort of unlocks additional benefits, then we'll give those licenses to you for free. And I can't here in the car, remember all the details of the numbers and stuff like that, I think, and you probably have it. I think aka.ms.bizapp.ISV connect, I think that's a link to our website that has all the benefit details and stuff, but that's basically the way it works. Steve: Are those available today? Toby: They are. There's a whole bunch of them available today and there's more coming. I know that the sales service, field service, marketing, I think the customer insights products, maybe commerce, I might be forgetting a few others and then there's more coming down the pike shortly. Steve: All right. So a good reason for people to go back to revisit ISV Connect site if they haven't in a while. Toby: I would love that. Yeah, I think so. If we can get people to go back and like you said, revisit, just get educated, hopefully get re-engaged and then keep the feedback coming. That's a great outcome. Steve: So I've had a few ISV's asking me about what's the future of ISV Embed, and maybe you can speak to that because that one's kind of a little vague, I think, for a lot of folks right now. Toby: Yeah. It's a great question Steve, that's kind of next, next on our list. And again, today I can't share a lot of specifics, but this is a good topic for us to come back to probably in our regular chats. Toby: As you know, Cloud Embed is a model that supports kind of like an OEM like model where a partner's just packaging their IP directly on the underlying license and selling it together through our ISV Cloud Embed program, which leverages our CSP vehicle as a way to transact. And so we've had it out there for a couple of years. And I may have mentioned before that we're sort of modernizing a whole bunch of our commerce capabilities and new business models and so we're working on a few different options still to support that embed scenario where things like co-selling with our field or certain other marketing benefits aren't the most important thing for a particular ISV in a particular scenario, they don't want to have to mess with reselling the underlying dynamics license. They're not resellers. They just want to sell their IP. Steve: Yeah. Toby: So we're working on some stuff there, especially, on both the core dynamics business and the power platform business. So we can stay in touch and I can come back to you for some feedback once we have more to share. Steve: Yeah. That, I mean, that program worked for a particular kind of an ISV. Toby: Yeah. Steve: A lot of the ISV's that have add on solutions that are not SI's, there's a partner already involved with a customer and they just want to sell their add on solution. Steve: Yeah. Licenses have probably already been sold by that partner. They don't want or need to get involved in that management of that sort of stuff. They just want to sell their IP. And then there's some ISV's that the customer is actually buying, which I think we're starting to see now. And I think I told you this before, one of the things that Salesforce had going for them with their ISV's was there were a lot of very robust ISV's that did a lot of direct marketing to customers about their solution and less so about the fact that it ran on Salesforce. Steve: Salesforce is this platform in the background, but this is what we're selling is this ISV solution, and in that scenario they own the customer because the customer wasn't buying Salesforce, they really were buying the solution to their problem for this ISV, and we hadn't seen as much of that on the dynamic side for a long time. It was definitely, you start with dynamics and then you add on ISV features and capabilities. But I think we're starting to see more of that, that holistic ISV solution that a customer is buying the solution that happens to run on the power platform or on dynamics. Toby: Totally. That's the scenario we see mutual opportunity in. That example, you said where the ISV owns the partner or the customer, the relationship with the customer, frankly that helps us reach more customers as Microsoft. And then if we provide that ISV still the underlying technology and the right business model to support their business, then that's goodness on both sides. So, that's exactly [crosstalk 00:29:10]. Steve: So that's the one where ISV Embed probably makes the most sense, , that type of partner. So we're starting to see more of them. Toby: That's great. That's great. Well, I always appreciate the feedback if you have any. So I'd love you to go through these new things in a bit more detail, and then send me your feedback and we can continue to keep the lines of communication open as always. Steve: I'm not letting you off just yet. I'm keeping you for a couple more. Toby: Oh man, I've got my team waiting, I'm hungry Steve. Steve: I just want to ask, "What is the most exciting thing you're seeing in the space coming soon that people should really be paying attention to?" I know we've got some things happening that aren't so much related to ISV, like the power platform pricing coming down, but what are some of the things that you're seeing in your group, or maybe some things that are already out there that you're feeling like ISV's are not understanding what this is obviously or they'd be all over it? Toby: Hmm. That's a great question. I'd say probably two things. One is, again, one of the big announcements we made at Inspire that wasn't necessarily related to ISV's or ISV Connect specifically, but what we announced with Teams where Teams users will now be able to sort of view and collaborate on Dynamics 365 records from directly within Teams. Toby: So this concept of collaborative apps you'll see, and that's at no additional cost. Obviously that concept you'll see us continue to do more around to bring that again, pretty large install base of Teams users that are out there, 250-million now, together with Dynamics, we think is sort of unique to our value proposition. So there was [crosstalk 00:30:58]- Steve: So this is somebody you think ISV's out there should definitely go do a little bit of investigating into the Team story? Toby: Yes, yes. Teams on the front end, it's such a large install base that we can take advantage of as partners. And then on the backend, I mentioned that again, power platform, Dataverse, leveraging our data services like Azure Synapse Analytics, again, stitching that all the way from the front end of the backend. We as Microsoft, we're really focused on that combined Microsoft Cloud story. And I think the partners that are recognizing that and investing in that with their own IP are the ones we're going to engage with and hopefully generate some good opportunity around. Toby: The second one, in that vein Steve, the second one I was going to say is just what we continue to do with our industry clouds. So we have cloud for healthcare out there at the moment, we've got financial services, manufacturing, retail, we announced the cloud for sustainability, we've got not-for-profit. So, these things continue to roll off the conveyor belt, but it's such a great opportunity. I was sort of surprised with how much interest we had from the ISV ecosystem around these industry clouds. Obviously as we build more industry IP, we need to sort of adjust our relationship with our partners who serve those industries, but there's still so much space to add, specific IP to that industry and work with some of those very credible industry partners that we were sort of talking about just a moment ago is a big place that we're going to invest going forward. So, that's an area I'd encourage people to keep a close eye on. Steve: Are you satisfied with the level of ISV engagement with the accelerators? Are they still kind of too many of them on the sidelines kicking or poking it with a stick or have we got enough of them actually coming in now that you're happy with that velocity? Or are you feeling like there's a bunch more that need to get in there? Toby: I think, first of all, we've evolved a bit from that original industry accelerator approach to now just real industry IP that we're building first party in these verticals that I mentioned. Obviously there's great partners out there that can work with us with those solutions to, like I said, have their IP built on that broader Microsoft Cloud. Industry clouds are just a great example of a Microsoft Cloud solution, frankly. And so to your question of, do we have enough partners there? You want to obviously get it right when you launch an offering like that with the right, frankly, small number of partners to complete the solution and have it be good and relevant and useful for customers, but the more the merrier around that investment. Toby: And so it's early days, Steve, we only have one industry cloud in market GA'd at the moment, but as I said, there's a lot more coming. So we want to make sure we're building the ecosystem around it pretty aggressively. Steve: Yeah. I mean, we've got partners of all sizes, so we got some big healthcare ISV's I'm sure engaged in some of the heavy lifting, but healthcare is an awfully big market, awfully big field, and there is spot, point solutions kind of across the healthcare organization that need to be filled by probably a smaller ISV's. So it seems like there's stuff across that whole thing. Toby: Yeah. Totally. There's plenty of opportunity and plenty of space around that. And even from a geographic perspective, I mean, different parts of the world have different regulatory requirements and are different, and so there's yeah, to your point, and that's what I was trying to articulate earlier. I think there's still just a massive opportunity for partners to work with us around those new offerings. Steve: Well, I know you've got to get to your thing. You've told me twice in the call, I appreciate you pulling the car over to chat with me to catch up. I just wanted to get some of this stuff out to the listeners about some of these changes that just occurred. Steve: And I'm definitely going to go through, like you said, and study it a little more closely and I'll reach out to you directly with some feedback and some thoughts and see if we keep this thing moving. Toby: Awesome. Well, Hey, I'm so glad you caught me, Steve. It's always a pleasure to catch up and have a chat, and yeah, please do go through it in some detail. Again, your feedback is important. Whole ecosystems feedback is super important to me, so I appreciate it. And yeah, it was great to catch up. Steve: All right man, talk to you soon. Toby: All right. Take care, Steve.

So I noticed Ryan Cunningham, Product Lead for the Power Apps side of the Power Platform for Microsoft, suddenly come available in Teams. So of course, I ambushed him, and we had a great conversation about Power Apps and the whole Microsoft Business Applications group. Enjoy! Transcript below: Ryan Cunningham: Hello. This is Ryan. Steve Mordue: Hey, Ryan. Steve Mordue. How's it going? Ryan Cunningham: Oh, Steve Mordue. How you doing? Does this mean I'm in trouble? Steve Mordue: No, you are not in trouble, but you are about to be a guest on my Steve has a Chat podcast if you have time and are up for it. Ryan Cunningham: You mean like right now? Steve Mordue: Like right now. Already recording. Ryan Cunningham: Hey, okay. Let me check my calendar. There's nothing I'd rather do right now than being an impromptu guest on a Steve show. Steve Mordue: Well, we'll try and make sure you don't regret that decision. Ryan Cunningham: I regret a lot of decisions, Steve. But it wouldn't be the first. Steve Mordue: So let me ask you first, how long have you been with Microsoft? Ryan Cunningham: I just crossed five years. Steve Mordue: Five years. Ryan Cunningham: Just this past fall. Steve Mordue: I used to be a Salesforce consultant. We were Salesforce consultants for about 10 years and we moved over to Microsoft when they first moved CRM online back in 2011. So about 10 years ago. Ryan Cunningham: Sure, yeah. Steve Mordue: And I remember there being a few bumps making that transition going from on-premise to online, but then it kind of leveled out into what I kind of called the lazy river ride. It was predictable, it didn't move very quickly. There was no urgency and then James took over and he brought in all you young guys. It's been like a rocket roller coaster ride ever since. You ever got one of those really big roller coaster rides where you start praying for it to end, but you know it's not going to. It's just going to keep looping around and you can't get off. I almost feel like for a lot of us partners that have been around at least since it was lazy river, man, my head is rocking from all of the stuff you guys are doing. Ryan Cunningham: We don't do lazy rivers very well, Steve. Steve Mordue: Not anymore. Ryan Cunningham: Not anymore. Steve Mordue: Not anymore. Ryan Cunningham: At least class three rapids around here. Steve Mordue: How is it like on the inside for that kind of pace and ideation and everything that's going on internally? Ryan Cunningham: It's a great question. It certainly has not been constant here either. And again my experience in this community is not as long as yours. I joined at about five years ago and specifically joined the Power Apps team long before Power Apps was really a thing. I joined the team when Project Siena was for those that are familiar with that term, the sort of precursor to Power Apps was kind of in an early beta phase and there were grand ambitions of expanding out who could build software, but not a lot of... How do we say it coming out? Not a ton of product truth yet behind that. Steve Mordue: So I was in the audience, I think for one of your very first presentations before a big group of this product. You looked a little deer in the headlights at the time. Ryan Cunningham: I still feel that way sometimes. But if you take that over the course of the last five years where that idea has solidified, that product has gotten more mature. Certainly there's still more work to do, but we've gone from literally zero humans using at least standalone Power Apps to millions around the world and really also in the same breath gone from very long tail, very simple use cases to this grand merger with the Dynamics platform and customers building and trusting frankly much more sophisticated workloads to the platform. Ryan Cunningham: The world has changed a lot for us internally in how we approach this problem as you go through that product maturity life cycle. In the early stage, it's really about can we make anyone successful here? Now, it is much more about how do we scale and how do we focus on enterprise trust and developer productivity and really turn millions into hundreds of millions and that's... Steve Mordue: Oh, we got a little stall there. Ryan Cunningham: Right. Did I lose you for a second? Steve Mordue: Just for a second. I kind of sometimes think of Microsoft kind of like the Japanese manufacturing economy where they saw ideas that we would come up with and then they would put all their resources to make it better, faster, cheaper whereas a lot of the things we're doing in the power platform are not things that weren't being done before by others, it's just that someone on the team somewhere recognize hey, there's this movement going on out here with some of these smaller players and I think it's got some legs, so let's let's drop all of the arsenal that we have available as Microsoft onto this idea because clearly, we weren't the first low code platform right, but suddenly we're bringing everything Microsoft has to bear on this idea and to see it blow up like that. Steve Mordue: You can say that for almost everything that we've got going on, the bots, the flow, all of these sorts of things. We weren't the first, but then we came in and just put all this horsepower into an idea. Ryan Cunningham: Yeah. And it so much is about execution and executing at the right time and doing it for the right people. I think part of the reason why we internally work quickly and don't want to be on the lazy river is also because I think we tried to approach it with this fundamental... This is going to sound weird, but distrust of our own instincts to say, "Look, we have a thesis that people are going to want to build software faster. We have a thesis that they're going to want to do that beyond just forms over data." That's going to take many different forms, but in the nitty-gritty details of who's actually going to find the most value in individual features and individual assembly of those features, there's a lot of margin for error. Ryan Cunningham: And the sooner you get real software into the hands of real humans and they can use it and react to it and give you feedback actively about it, but also just give you feedback through their usage or non-usage of it, then the sooner you have real data to adjust and change and do the next thing. Steve Mordue: So it's not really like build it and they will come, it's more like build something and let's see who comes. Ryan Cunningham: Exactly. Steve Mordue: And then build some more. Ryan Cunningham: Exactly. Develop a relationship with those people who have come and then make sure that you're building it in a way that they're going to get really excited about it and then extend to others. So we really prioritize when we have enough of a hypothesis to head in a direction get there as soon as possible in the world and then work really closely and quickly once you've landed there to make it great and learn, and be willing to be wrong and be willing to change. Steve Mordue: Don't worry. I pointed out when you [crosstalk 00:07:43]. It's a lot of moving parts. I know you came in through the Power Apps door but have since kind of got your fingers into the whole pieces of platform it feels like. There's a lot of moving parts going on. Whenever you have that many moving parts, there's going to be bumps and issues along the way. So I can imagine that's just a continuous thing that somebody's building something over here. Somebody over here. Maybe they didn't coordinate as well as they should have and it gets discovered later and then I imagine these little fire drills going on internally [inaudible 00:08:20]. Steve Mordue: Left hand wasn't talking to the right hand enough. Let's get that stuff going on. Is that part of your role is to referee those sorts of things or identify them? Ryan Cunningham: I guess you could say that. And that's also part of growing a product and a team across a really wide surface area. How do we put in place the right listening mechanisms to customers, to data and reviews internally so that we can catch those things sooner and react to them more quickly. Because in many ways the ambition here is to span a really wide area of software and do it with a platform that has value and relevance to a number of different people in that spectrum, which is fundamentally really hard. Ryan Cunningham: It's one thing to build a focused experience for one very focused narrow niche of people, it's another... That alone is hard. It's another to build a set of tools that a lot of different people can use. But I think that was actually part of our... If you rewind several years ago and look at what we did between the Power Apps software project which started independently and the Dynamics platform and bringing them together, we really realized at the limit these things converge. At the limit, making it easier for non-traditional software people, citizen developers, amateurs, makers, whatever you want to call them and making it faster for professionals to build apps, those two ends have to meet each other at some point for this to really scale. So let's rip that band-aid off. Steve Mordue: How close do you think we are? How close do you think we are to getting to that ideal point? I mean, I think there's still... Even when I look at the citizen developer stories, a citizen can go so far and obviously we'd like them to go as far as they're able to go, to comfortably go and pro dev takes over. I have to assume there's a continuous motion inside to keep trying to move that line. Let's simplify some of these formulas that may be required that are just whatever those stopping blocks where you see a citizen is able to get this far, it hits a wall. Can we get them to the next wall? How much is going on in that process? Ryan Cunningham: It's a great question and it is really one of the central things that keeps driving a lot of what we do. I mean, we also look at a professional's experience through that journey, right? You look at not enlightened professionals such as yourselves, but all of the other software people out in the world who are very skeptical of platforms and who have an instinct to start from scratch and write everything themselves and go through some- Steve Mordue: Some of that could be financially motivated also. Ryan Cunningham: Oh, sure. Steve Mordue: Yeah. Ryan Cunningham: Right? But I think realizing that two trends are really converging here. To your point earlier, low code is not new, but we've had low code in two very different camps. This is the company that shipped Excel 35 years ago, 36 years ago. We certainly know low code for true amateurs and there's always been this world of people without a software development background working around the boundaries of the software they're given with tools to solve problems and that goes straight to- Steve Mordue: To Access wizards. Ryan Cunningham: Absolutely. Excel macros, VBA, Access, InfoPath and a number of other products outside of Microsoft. That's an enduring tradition. Then on the other side, what we've been doing is professional software people for the last 40 years is just adding layers of abstraction and tooling and not repeating ourselves and borrowing from other people to more efficiently assemble solutions as well. You can look at a platform like what XRM was unofficially and Dataverse and Power Apps on top of it now is just a natural extension of making professionals more efficient by not doing everything from scratch. Ryan Cunningham: Now, that's where those two trends converge and you're absolutely right to answer your question. We focus on okay, we made a number of people successful at that. There's a plenty of existence proof in our community and in our growth numbers and in our customer stories of people coming at the product from both of those directions and getting really successful and having a lot to show for it. Now of course behind the scenes, we're still, I would say very hungry. We're still at a couple orders of magnitude less than the addressable market of software consuming humans of what we could be serving even for all the astronomical growth we've seen in the platform over the last couple years. Ryan Cunningham: I mean, so it is absolutely about how do we take people coming in the front door. I'm a Teams user. I have some Excel skills. I happen to stumble on this Power Apps thing. How far do I get on my first try? What brings me back? How do I go from a user who expresses intent to a user who has a moment of success, to a user who then has an app that's used in production. And even from that point to somebody who keeps coming back to keep putting apps in production. Ryan Cunningham: Then similarly as a professional, how do I expand my tool set from Azure and Visual Studio and how do I have good experiences in my first try with a platform. How do I get to a point where I put something out there that humans are using in the world and I feel good about it. We really closely look at retention. We look at funnels through those early experiences. We look at satisfaction. All those annoying prompts of how likely are you to recommend Power Apps to a friend or colleague. Those are really valuable data points for us in addition to just the general growth rates overall because of indicators of the likelihood to be successful and grow in the future. Steve Mordue: I know we definitely have had success with enterprise organizations in particular where IT has embraced this and shepherded the process and built in their own systems like at the whole chevron way that they go about making power apps developers out of their employees and they've got a very specific process. I guess the other side of the equation is a smaller company that doesn't have those kind of resources. It's just Bob who's always been handy with spreadsheets. Suddenly he's trying to figure his way around. It seems like that's the one where we can't give that guy too much help. Steve Mordue: In enterprise they're going to have their system. Maybe have classes internally. They send their people to and stuff like that. It's a smaller organizations where he's left to the documents he can find and what he can understand. I think one of the things that Microsoft has always been a little bit of a challenge with Microsoft and documentation in particular is that they assume a certain level of understanding, in particular Microsoft and there's lots of folks that are coming to the platform that have zero understanding of Microsoft or history or know anything. Even acronyms or none of it. Ryan Cunningham: Right. Steve Mordue: It's almost like you can't make the documentation too dumbed down to get to that success. Well, how big is the team up to? Now, the last number I heard, and this has been a while ago, it was like 7,000. It was a pretty, pretty good sized team for the bag. How big is it now? Ryan Cunningham: That's a good question. I'm not trying to dodge you. I suppose I could look it up. I don't know for sure what James is... That whole business applications group org size is, but that's actually probably a decent estimate now that's not too inaccurate. Now, that's spread across a really wide surface area. All of the first party Dynamics apps have dedicated teams working on them. There are a number of other orgs within that organization focused on things like advancing AI and whatnot and then there's the core platform team, the Charles Lamanna team which I'm a part of which we structure into a core team focused on the backend, on Dataverse. A core team focused on each of the front-end products, so Power Apps, that's my team, Power Automate, Power Virtual agents. Then we also have a dedicated group in the platform org around admin and pro developers, and those experiences. Steve Mordue: I think when he came in, there was closer to a thousand on the team. So I mean the team has exponentially grown because you can't keep a lazy river going. Ryan Cunningham: Nope. Steve Mordue: You got to have speed when you got that many people on the payroll all working on something. So I also recall a time and I know it's still there, where there was a maniacal focus by the business applications group on the competitors particularly Salesforce at the time. I know that Salesforce is still in the radar. It does feel like we've kind of moved from really being focused on one primary competitor as we've launched all of these different applications into other competitive spaces where now you guys have hundreds of competitors that are all out there. How much do you guys focus on what the competition is doing internally and how you guys gauge what directions to go? Ryan Cunningham: It's really important to be aware of what people are doing in the marketplace. And we do spend a lot of time making sure that we have an intimate and hands-on not just academic understanding of what a lot of different software companies are producing out there. Steve Mordue: So you guys have licenses for everything. Ryan Cunningham: Well, where we can and it gets complicated because Microsoft also partners with many companies. Some companies we have agreements with about who will or won't use what software and we've got a lot of great lawyers to help us navigate that whole [inaudible 00:18:23]. I think the point is look, we're adding software to a world that already has a lot of software in it. It's important to look left and right and be aware of what else is out there because none of this stuff gets consumed in a vacuum by customers. You go to any moderately large customer organization, there's already a CRM system or seven in place. There's already an ERP system or eight in place and there's already a bunch of individual systems around that for point things and that's just the world we live in. Steve Mordue: And if they're exploring something, they're seldom exploring one thing. Ryan Cunningham: Exactly, right? And often if they're exploring especially a platform. There's a lot of existing things and a lot of the conversations become about how does this work in an existing ecosystem and how does it work? How can it potentially consolidate some of those things? We had Ecolab at a recent digital event talking about some of their Power Apps and Dynamics implementations. The average field employee at Ecolab had something like 27 different individual tools that they had to use to get their job done and it was a mix of... I mean, they had dynamics and they had Salesforce, and they had an ERP system, and they had a whole bunch of individual custom homegrown things and this experience was just really terrible for somebody out there on a tablet or a phone trying to inspect your water filter at your company. Ryan Cunningham: Starting to bring in Power Apps as a front door to some of those other systems without replacing them and just even making the wayfinding better is key. So look, it's important for us to be aware of what the world is doing. I would say it's never as simple as pure competitor or not in that picture because look, if you're a company like Microsoft, a lot of the names you rattled off or alluded to are also Azure customers and they're partners with them in other places. We're fundamentally a platform company I think is what it comes down to. Ryan Cunningham: The world is better when people can choose what they want to choose and are able to interoperate with those things at scale. Now obviously, there's incentive for us to have them using our stuff in that mix which is why we care a lot about it, but there's really not... Especially if you look at the body of what we offer even just in the platform, there isn't a clean head-to-head competitor right now for all of it. There are certainly competitors for each piece and I think being aware that those customers have choices and that we want them to genuinely choose the best and we want to be the best, that means we have to be aware of what best is and what customers define as best is just as important as what the guy down the street is offering. I think that the business applications group has the advantage of the enormous coattails of Office 365, now Microsoft 365. Steve Mordue: Sure. I don't know how many calls I get from a brand new customer who the primary reason they're looking at this platform is because they're already using Microsoft 365. And this idea that we want everything to work together and talk together. I think those coattails are an example of coattails that some of the other companies just don't have. You look at Salesforce for example. They don't have this productivity suite with millions and millions of users. So their story is going to be... We can integrate story and I just see more and more... I think we have to give such a credit for this because for many years Microsoft had a mixed reputation with IT. Steve Mordue: There are lots of people that hated them and all sorts of different things and such. It kind of seemed to have changed the attitude of the company to where IT who used to be like we're using on-premise exchange that's the only Microsoft thing we're going to touch. Now, they've brought in Microsoft 365. Now from an IT standpoint, it's you know what, I don't want to make my life any more difficult than it needs to be. What's the most logical choice for business applications when we're already stood up on all of this stuff and it's an enormous advantage and a huge coattail for the whole business applications group to ride in on. Ryan Cunningham: Yeah. I mean, this is why we focus so much on the platform working well in Teams for example. We've put a lot of effort into that this past year. I mean, part of that is the world turned upside down and changed and everybody started working in Teams. The other part of that is it's a huge advantage for a customer to be able to program and customize the collaboration environment whatever that is. Again, there's a long history of that within Office with SharePoint and InfoPath and stuff like that, but being able to look at that in a modern world and say, "I already have every employee working every day inside the team's environment. If I can start to put line of business applications in that environment, it's much easier for those employees to discover and it's much easier for them to then work around and collaborate around when those experiences require some form of collaboration." Ryan Cunningham: There are major Microsoft customers, Fortune 500 customers with tens and hundreds of thousands of users in their tenant that have more than half of those users using a Power App and Teams every month. You see IT departments using it. Those are not necessarily bottom-up Citizen Developer apps. You see IT departments really seeing that as a way to sort of re-imagine maybe what we might have called an intranet site 10 years ago sort of imagine an employee-facing app in the place where employees are already working. Steve Mordue: Sometimes, I actually feel a little guilty that one of our biggest growth years was a result of a virus and certainly the same could be said of Teams. I mean Teams was doing fine, but a virus really catapulted Teams to the position that it is. You feel a little guilty, but then again it is what it is and somebody has to feel that that need and it does create some massive opportunity. Ryan Cunningham: For me, especially rewinding to March and April, and May, I mean this was really a pressure test of our whole promise. The whole shtick and spiel of saying you can develop apps faster, you can do it quickly, you don't have to go through all the time and expense of software development, you can put it where people want to use it. Got a lot less nice to have in March of 2020 went from a lot of people from, "Oh, that sounds cool. I'll check that out someday." Steve Mordue: Someday. Ryan Cunningham: This is interesting to this is the only game in town. There were moments where I don't... I hear what you're saying. It is difficult to go feel like you're thumping your chest about business success in a year where a lot of people have had a really hard time and I really want to be sensitive to that. At the same time, the platform has really directly and indirectly helped a lot of people with those struggles. A whole number of both through the healthcare response to COVID, solutions that were implemented almost literally overnight in some cases for major state governments around the US and national governments abroad to first roll out large-scale testing programs on portals with CDS or Dataverse behind it and then roll out economic assistance programs on the same platform. Ryan Cunningham: Now rolling out return to work solutions on the same platform. Those are things where the traditional model of start up a waterfall development process, go write a giant requirements document, triple bit it, go through... You don't have the luxury of the Gantt chart in this world and you have to be able to move fast. And those are places where that is the platform we've been building for is that environment where we got to move fast. We have to do it non-traditionally and we have to do it with a lot less effort. Ryan Cunningham: This last year has really forced us to hone in on that value prop and prove that it's real, and frankly adjust a lot to make it more real for people who are trying to get that value. So I would say we have learned a lot in the course of this pandemic. A lot of people have. But we've also been able to do some good for the world in the same breath. Steve Mordue: It definitely was interesting timing because if you guys probably had to pick a time for a super crunch test of our platform maybe you don't like to see it in another year out or something. Ryan Cunningham: Yeah, sure. Steve Mordue: You can't cage these things, but it kind of hit when you guys still had some wiring to finish and I would imagine that the pressure on the team... It's one thing to we got to be out to market quickly because of competition. It's another thing because something like this has come. It has to bring a huge amount of pressure the team. We need to take Teams to the next level. We need to take build your own apps the next level and suddenly we've got an entire workforce that is now working from home that never planned to be working from home that is completely ill-equipped for that entire motion and these people need this stuff fast. Ryan Cunningham: Not to mention an entire generation of students who are now learning remotely, many of them in every age group from my first grader up to colleges and in universities. It's affected everybody. But you're right. I mean, the platform has been stretched at every level and it's not just the power platform. You're right. It's also very much Teams. I saw a really interesting internal presentation from an engineering leader in the Teams org comparing, "Look, here's what our load and traffic pattern looked like in January of 2021 and then to scale superimposing that on what it looked like in March." Not to say that, "Hey, look at all this great growth," it was really to say, "Look at what it took to go scale a planet scale service that dramatically that quickly." That was not a pleasant experience for the engineers having to work on that. That was [crosstalk 00:28:54]- Steve Mordue: A lot of late nights. Ryan Cunningham: ... 24/7 as any other response. No software is perfect. We like to gripe about everything and I share my set of barbs with stuff, but man, I have a ton of respect for the Teams engineering group and how well they have handled that just massive overnight change. Steve Mordue: So as we're recording this, vaccines for the virus are rolling out and I assume at some point in the coming months, it'll be behind us. In the meantime, it was around long enough to push lots of people to work from home longer than maybe their company owners thought would have to happen, but now they've gotten used to that. They've made accommodation. They've made it work. What do you think is going to happen when this particular crisis has passed and there's the ability to go back to normal? What do you think is going to happen with all these folks? Are we going to see a mass return to offices? Are we going to see people say, "This is working"? What are you guys thinking? Ryan Cunningham: I mean, it's a good question. I don't know that I can speak for all of Microsoft on this one, but I think at least in our own team- Steve Mordue: What do you think? Ryan Cunningham: I mean look, our team is already very globally distributed. We have the majority of our engineers and core products, PMs working in the Pacific time zone, but we have a significant group in Paris. We have a significant group in Bangalore. We have individual pockets. We have people in Fargo, North Dakota. We have a team in- Steve Mordue: Israel? Ryan Cunningham: We certainly have team in Israel. We have teams in parts of Europe. We have a team in Toronto. If nothing else, I think the core of [inaudible 00:30:49] sound based team has developed a lot more empathy for the experience of the very significant portion of our group that works around the world. I'm very experienced joining Teams. And I really hope that that continues if nothing else even if we all end up back in offices at a more regular level. Ryan Cunningham: We've learned at digital events and conferences and stuff. Certainly, it is not the same as being in the room with people catching up and networking, finding those discovery and unplanned moments with humans. And I do believe that we will go back to getting in rooms together both as employees, but also as colleagues. I really hope that we get to do that again soon. However, some of the digital events that we've pulled off as unelegant as some of them have come together also very rapidly having to figure out how to completely reimagine conferences like Ignite virtually in just a few months, those themselves were gargantuan tactics. In some cases there were orders of magnitude more participation in those events than when you had to get on a plane and fly to Orlando to get the benefit really. So there's- Steve Mordue: If I'm Microsoft, I don't know how eager I am to go back to in-person events given the success of like you say, I mean, so many more people able to attend. Microsoft's goal in having an event isn't for us all to hang out and have beers, it's to disseminate product information to his broader audience as possible and as deep a format as possible. Sitting in a session room, watching some guy present a slide deck, maybe it's a little more interactive, but not enough more interactive to justify the 30 people behind me versus 3,000 people that could be behind me in a video meeting. Steve Mordue: So from Microsoft's standpoint, you would think that, "Hey, great news. We don't have to go back to doing live events," which are, I think, they got to be a huge expense, a huge logistical challenge, all that sort of stuff. So the only reason to go back- Ryan Cunningham: I mean, I imagine- Steve Mordue: ... would be camaraderie or something. Ryan Cunningham: Like all things moderation. I'm sure we will... I hope we will reconvene at least some live events and I'm sure we will. I think we've learned that there's probably a bias before this year, this past year that the digital portion of a live event would be much less valuable. I mean, even already, I don't want to overplay that hand. Even already, we would frequently get more total usage over a lifespan of content consumed digitally when it was produced at the live event than at the live event itself. Ryan Cunningham: You could take a keynote at Ignite. There's 3,000, 10,000 people in the room, whatever, but then you go take the three months following the streaming of that online would accumulate far more visitors and end users than originally. That was already known. But being able to extend that from the keynote stage out to every session and being able to figure out how to produce that type of an event in a very decentralized way is, I think we've learned a lot through that process. Ryan Cunningham: Back to your question about people going to offices and the team working in places, I think there's a lot of reasons why a lot of people really value that type of working whether... There's people on my team who live alone and are really, really craving social interaction with other humans that are ready to come back. But there's also people on my team and self included with young kids in the house and a lot to manage and really craving return to normalcy and in that type of life environment. Ryan Cunningham: So I think work from home, I think we've all learned that we can do it and some people have learned that it's even better for them, but I think there's a lot of people who will still value working in a physical location and I hope we'll return to a good chunk of that as well. Steve Mordue: Yeah. It does get kind of lonely for a lot of folks especially those social people that need to be around people, need the water cooler or need to go to lunch. Ryan Cunningham: Yep. Steve Mordue: That's the best part of what they're doing. Ryan Cunningham: Yeah. Steve Mordue: Let me ask you about... Maybe I'll get a little self-serving here now. Ryan Cunningham: Sure. Steve Mordue: You're familiar with our RapidStart CRM? Ryan Cunningham: Yep. Steve Mordue: And I'm just curious about what the team internally thinks about motions like the one we're doing and others are looking at where we've... And I know you'll be a little biased because you're more on the platform side as is Charles. Charles is less concerned about the first party group. They got their own problems to deal with, but we're basically making a business out of building simpler versions of what the first party Teams have built for an audience that isn't prepared for that level of complexity. Ryan Cunningham: Yeah. Steve Mordue: And we've built it to run on the $10 pass, and we recently made it free. I'm just curious what the talk in the halls is about ISVs like us that are basically building products that are attacking directly. I mean, I'm attacking directly the sales professional for sure and even enterprise for a lot of customers because you've given us enough in the platform that I can build quite a bit for a lot of customers before I'd have to really go to those first party. What's the talk in the halls about that kind of motions? Ryan Cunningham: Well, luckily we don't have any halls anymore, Steve. We're all working from home. Steve Mordue: That's true. Ryan Cunningham: Otherwise we're- Steve Mordue: In the video halls. Ryan Cunningham: [crosstalk 00:36:36] Steve Mordue in every elevator lobby. Look, I will say a couple things on that. I don't want to speak for Charles, but from a platform perspective and certainly from my perspective too. Yes, our day job is focused on building a platform. Our biggest customer of the first party apps running on that platform still by revenue at least. We have a lot of incentive as a Microsoft shareholder and as a member of the business applications group and seeing the first party apps be successful. In fact, a lot of our effort and our engineering effort goes into helping those first-party apps be successful and stay successful and get modern and get fast and get mobile in addition to or in some cases around building the core platform itself. Steve Mordue: James has said not that long ago that make no mistake, those are what pay the rent. Ryan Cunningham: Yeah, absolutely. Look, Power Apps is driving an incredible amount of growth from a both a usage and a revenue perspective. But yeah, I mean there's an established greater than a decade business in CRM at scale that customers are driving themselves trusting billions of dollars of business too and paying Microsoft a lot of money for that privilege, right? So we take that very seriously and we are directly incented to protect that business whatever that means. Ryan Cunningham: Now, that said to rewind earlier in the conversation, we're a platform company at heart right and it's not just that Steve Mordue can go out there and build a CRM system on the Dataverse and Power Apps platform. I mean, we have multiple Power Apps competitors building on the Azure platform. They're Azure, and that's great as a shareholder and as a software person. The best solution should win and that's never going to be a one-size-fits-all answer for every customer. To your point, there are some customers that are going to be best served by a certain piece of software and Microsoft as a builder of generic things is not going to get into every niche, it's not going to get into every vertical. Ryan Cunningham: We want an ecosystem of people to build on the platform and extend things and even build fully standalone things for those niches, because we won't get there ourselves and we know that there are more of them out there where expertise needs to go. For Microsoft to really have a Microsoft product offering at scale, it needs to have a really big business behind. It's a really big business behind it. There's plenty of opportunity in the market at other multiples that is very profitable for software vendors and very advantageous for customers that are businesses that Microsoft will not directly enter. Ryan Cunningham: So I think in those worlds if the platform doesn't work for that, then what's the point of having a platform. It needs to work for that and we need to make RapidStart successful just like we need to make the first party Dynamics app successful. I believe those two things are not at odds with each other and they should live in a co-existing world. Ryan Cunningham: From a customer perspective even as a platform person, a lot of people will come in and say, "Should I use this off-the-shelf piece of software or should I build it myself in Power Apps?" My first answer to them is always if the off-the-shelf thing does what you needed to do or even does 80% of what you needed to do, it's usually worth buying. And even if the price tag feels more expensive, because what you're buying there is a team of people behind that app who not only put all the effort into making it, but are going to keep putting effort into making it better. Ryan Cunningham: And whether that's Steve's team or whether that's Muhammad Alam's team that is almost less relevant. The concept is I'm going to buy a piece of software that people have already figured out a lot of the hard parts for this use case and they're going to keep making it better. Now the ability to extend it is really important in business applications because selling shoes is very different than selling wind turbines even if it all involves selling stuff. [crosstalk 00:40:55] Steve Mordue: It's one of the reasons we ended up going free. When I first came up with that idea for RapidStart, we launched it in 2015 and it sat on top of CRM online the single SKU at the time to just really make the whole thing simpler because there was that need for something to be simpler. I had this dream that I was just going to sell that. People would buy it, pay me every month and leave me the hell alone. That was what I had imagined. But everybody, everybody wants to tweak and fiddle and make it unique. We actually look back last year at our revenue with 10 times more revenue on the services of helping customers customize our app that we did on the recurring revenue. Steve Mordue: That's the reason we decided, "Well, let's just make the app free and lean into the services as much," because I really didn't want to do that. I didn't want to do that business at all. Now, I'm being you know pulled in or the godfather won't let me out of the services business. But you're right, everybody needs something unique. So we really recast them as accelerators as opposed to here's something you just buy and use. But it's the same even with the first party apps. Nobody installs a first party app and just uses it. Steve Mordue: They've all got to be molded to fit the business, and I think that that's the nice thing about the platform whether it's on first party or just on Power Apps is you've got all the tools to... And that's actually one of the challenges we run into, I'm sure you guys do too where they look at some app and they say, "Oh, that's not exactly what I need," and then they move on, without realizing that, you know what, that can be exactly what you need and frankly, with the tools available that we have today, not that expensive, not anything like it used to be. Ryan Cunningham: Supposed than what I need and I can make it to work. Steve Mordue: Yeah, and a fraction of what it used to cost to do those kind of services. Ryan Cunningham: Part of making this stuff easier to adopt is about having apps that are much... At least much closer to what a customer needs out of the box. They don't have to do a bunch of customization upfront. I think something that we have been on the journey from, if you go rewind 10 years in CRM to now is make it less of a giant monolith make individual modules much more ready to consume. We've done a lot of work around that. But even within Power Apps, a lot of people get started by grabbing a template and implementing it and starting to use it fairly stock and then realizing, "Hey, I want to put my logo on it and then I want to change this form and then I want to change the field. And then I want a thing to kick off." Ryan Cunningham: Making the customization incremental as opposed to putting a really large tax and price tag before it's useful is one of the tactics we pursue to make it easier to get more people started. But that said, there will always be the need to tailor and customize software in a business application space. I think one of the trends we are seeing is this blurring of lines between... We like to pretend classically that there are ISVs who produce software and put it in the world and then never touch it. Ryan Cunningham: Then there are system integrators who do the dirty work of services to make it work. Those lines get really blurry in the modern world where from a classic services provider standpoint when I'm building and customizing on a platform, it's actually much easier to then start to templatize and repeat my solutions so I'm not just doing labor every single time. Ryan Cunningham: And to your point from a software maker perspective for customers who want to constantly customize it, it gets more viable to go the other direction depending on what your business model is. We see a lot of people living in that world. We even see customers themselves, energy companies, healthcare companies building stuff, financial services companies building stuff for themselves on the platform and starting to commercialize it to other people in their industry because it's on a platform that's transferable and that's something that classically you didn't see with line of business software. Ryan Cunningham: It was built in a vacuum custom and very tailored for one customer and then it sort of lived in that silo for a long time. But the ability to make those assets transferable is a huge advantage in this world. Steve Mordue: Back when they really first started pushing the Citizen Developer motion, I think I wrote a post about the end of SI business. This is it. We're all dead now. They won't need us anymore. The sky is falling, Chicken Little. But now as we've seen this thing roll out, because it is less expensive to get deployed, there are people building apps and using apps that would never have considered it before. Steve Mordue: So while I would say it's probably true that our average customer SI project has lost a zero in value, there's 10 times as many of them. So it's evened itself out. We've got many more customers available now than when the only way you could become a customer was if you had really deep pockets and a lot of patience. So we just opened up the number of potential customers by 10 times even though the deployment of each has gone down some. I'm not disappointed. Ryan Cunningham: And I think that trend is holding. I mean, I think you see even some of the big services companies like the big four and stuff like that actually seeing some very similar trends where they're building real practices on power platform whereas a couple years ago, they didn't see it as something for their business model, maybe even a threat to their business model. Now, they're realizing, "Look, I can drive real revenue out of this just the size and dollar amount and number of projects is a different mix that it was before." Ryan Cunningham: In some cases, those tend towards strategic consulting engagements. It becomes, let me think about helping a... For a large global organization to wrap their head around how do I use Citizen Development in my company? How do I keep it secure? How do I monitor it? Where do I let a business unit roll their own thing versus where do I bring in a team of professionals to build and maintain a solution? Ryan Cunningham: Even just that decision-making process and the center of excellence and governance practices that go around it, that's a major engagement that a lot of customers need help with right now because they're not organized for that today or resourced for it today. And then you look at getting into each of those individual projects. Certainly today, even in a future where apps are 10 times as easy to build as they are today, if I'm going to go roll out a mission mission-critical solution for managing customer data and critical decisions, I need software-minded people to help me think about how to keep that compliant, about how to build it in a way that humans are going to want to use it. Ryan Cunningham: Just because we put a tool like Photoshop out there in the world, does not instantly make everybody a photographer and a digital artist. There's still that mindset and expertise that's going to be really necessary. So for a lot of a lot of services organizations right now, I think they're realizing that there is a lot of value both in the execution of individual apps and projects, but then also in helping customers adapt to this new world where a lot of people can build software and you have to make decisions about who builds what and how you maintain it. [crosstalk 00:48:15] Steve Mordue: I think definitely one of the areas that's been blown up completely is the old ROI story because you used to be looking at a significant investment to deploy something of time and money, and the return on that investment was quite some time. That was what was going to limit the growth of any business application platform out there was... And now, that's produced almost nothing. Steve Mordue: So literally, Bob can go build something that starts generating revenue or saving money in an afternoon. The ROI, it's not even a question anymore about a half a day of Bob's time to go and streamline this process and save us five hours a day with his four-hour effort. Ryan Cunningham: True. Steve Mordue: And that didn't exist before. That just did not exist within the dynamics application before platform, before Power Apps, before Canvas apps. It's completely changed the entire game. Ryan Cunningham: Yeah. Steve Mordue: Before I let you go, what of the things as you look across the landscape right now and maybe the things that are coming up that have been discussed that people are aware of, what excites you the most? What do you think is... Two things. What are you the most excited about? And the other one is what do you think more customers would be excited about if they understood it better or realized that that's the most underutilized high value thing that people are just missing? Ryan Cunningham: Sure. Those are big questions. I think there's a lot that I get excited about. For people that know me, it's not hard to get excited. Steve Mordue: Yeah. You're excited about that lamp in the background, I know. Ryan Cunningham: Exactly. It's a great lamp. It's not. It's a crappy lamp from Ikea. Look, I think for me certainly there's a ton of work in our feature backlog that's really cool and really exciting and there's a lot of work particularly around bringing intelligence to the authoring experience that I'm pretty excited about. To the earlier conversation we're having about make it easier for people to be successful and maybe not have to deal with that formula bar, there's a lot of cool stuff that we're starting to apply. Ryan Cunningham: We've brought AI builder to end user apps, but actually bringing that to the maker experience of being just... And not in magical unicorn pixie dust ways, but just in really practical ways suggesting ways for people to do things, suggesting things to do next, making it possible to write logic in natural language as opposed to having to know all the ins and outs of the formula for example. There's some really cool stuff cooking there that I think will start to continue to open up orders of magnitude of humans who can be successful. Steve Mordue: Move that bar farther down the path. Ryan Cunningham: Absolutely, right? Classically, sometimes we think about those as tools just for true amateurs. But if you go look at even all the productivity that a product like visual studio has brought to professional developers, it's in stuff like Typeahead and linting and all that. It's really about bringing micro intelligence to those micro interactions that a person who's living in this tool for eight hours a day, all day long is going to need to be really productive. Ryan Cunningham: So we're really thinking about that both ways. So those things are exciting. I think if you zoom out a little bit though beyond the individual level of feature work, I would say, what's most exciting to me and what I hope is getting more exciting to more customers is less about any one individual feature or product and more about what's possible when you start to combine them at scale. Ryan Cunningham: I think that's where, if you look at organizations that have really gone all in on Citizen Development and low code for professionals as well and start to work together, you see this new way of working where you have professionals and amateurs and IT people and business people knowing each other and working side by side in a place where they traditionally were opposed to each other. Or at least just not aware of each other. And that's where you get not just one cool app with one cool feature, but literally thousands of applications inside of organizations that are just creating a crazy amount of value and you start to change you start to change the lives of people in those organizations. Ryan Cunningham: Both the people that are able to implement that stuff, but also you just make the jobs better for the people who get to use stuff that was built by their company and was built much faster. That's ultimately super exciting to me is to start to see this making a real change in the way that humans are working and doing it through a mix of apps and bots and automations, and Teams experiences. Ryan Cunningham: It's when those things sort of work together in concert that I think they get most exciting. So I'm thrilled to see that happening. I'm really excited about this end-to-end stack of what customers have done with Azure resources through power platform, in Teams and how that has created a meaningful dent and how a company works. I'm super excited about all the work we're doing to make that smoother to actually implement and manage and deploy, but I really hope customers see beyond the one use case, see beyond the one app or see beyond the one product and see what's possible when I start to change the economics of how software is rolled out in my company. And by economics, I mean not just- Steve Mordue: It is a discovery process. Ryan Cunningham: ... who participates. Right, yeah. Steve Mordue: It is a discovery process. They stumble upon something. They start using something and if they're successful with it, then they start discovering these other pieces around it that are available around it to extend on it. I don't think the technology itself right now that we have is a blocker to growth. I think the biggest challenge with growth right now probably relies more on the complexity of the licensing side. I mean, there's a lot of customers- Ryan Cunningham: I mean, I think there's good parts of it. Steve Mordue: ... that can't even get started because they don't understand what they even need or how to buy especially in the Power Apps store where they've got some seated Power Apps capabilities, they don't know what word seated even means or that they have it, and then they're seeing all these cool Power Apps things and they can't figure out how do I get from here to there? Why can't I do this and that? I think that probably is a bigger blocker to potential growth than the technology itself. Ryan Cunningham: Maybe. I would say certainly- Steve Mordue: Have you read the licensing guide? Ryan Cunningham: It's my favorite James Joyce story. Steve Mordue: I'll bet. Well, most customers haven't and wouldn't. Ryan Cunningham: Well, I guess what I would maybe zoom out from that, I would say... You're right. The technology itself can solve a lot of problems for a lot of different people and we have existence proof of that. Getting an organization at scale to discover it to see it in that light and then to have an organizational culture embrace it. Certainly licensing is a part of that, but it's also about who in IT is responsible for it? How do we govern it? Where do we roll it out? Who is footing the bill when I do understand how to pay for it? Ryan Cunningham: At the end of the day, licensing is actually very simple which I know is a controversial opinion. You get a measure of it in Office. For extending Office, you pay for Enterprise data sources. There's two ways to pay. You pay per app or you pay unlimited, full stop. That's the license. Now, we do not do ourselves many favors when we have classically rolled that out. And I absolutely take your point that we have made the communication of that complex. Ryan Cunningham: And for a lot of customers, this is not a commodity expectation. We're at a point right now where everybody needs an email account and a productivity suite and Word processing and every seller needs a CRM license and those things are not necessarily controversial, it just becomes about what's the best price from the best vendor. Because they're mature products in mature markets. Ryan Cunningham: Low code is at a very different state of market maturity. So for a lot of people it's about not just understanding how our pricing is structured, but understanding organizationally for them how do they conceptualize ROI? How does the market offer these products and how do I evaluate that potential expense against the value I'm going to get out of it? I think in addition to making things like the licensing guide easier to read for people who do not have PhDs, I think it's also really about helping the market get more mature and seeing... We really genuinely believe this will become an expectation of organizations. Ryan Cunningham: If you go fast forward another couple years, if I can't rapidly innovate internally and I am dependent on a team of professionals to start from scratch every single time that I that I need a problem solved, that's going to be a major competitive disadvantage for organizations. And on the flip side, being able to have every information worker be able to do at least basic tasks extending their software and solving their own problems is increasingly going to be an expectation. Ryan Cunningham: We're not there yet from a market maturity standpoint. Not everybody sees it that way, but we've certainly seen enough proof of organizations already evolving to that point that we know that that's coming. So I think being able to get to that place is a journey for a lot of companies. It's then really the next phase for us of bringing the world to where we know it can be. Steve Mordue: I mean, you just look at some of the things in the past like the first Obamacare website debacle with all the millions of dollars they spent to basically build a website and then look at what it would have taken for somebody to pop that up on portals today. I mean, there's no compare. I mean, we've actually lost projects in the past because the people thought we didn't understand the scope because we were like 10% of what the other companies... So we clearly misunderstood the scope and they just misunderstood the value of a platform and what that does to a development cost and time cycle and everything. Ryan Cunningham: There are government entities that rolled out COVID testing solutions on Power Platform in literally weeks to tens of millions of citizens and had that go off without any major hiccup. You're right. We get back to that pressure test. It's like getting that to go to scale and to help more people see it that way and be able to expect that from their software. That's really the next mountain to climb. Steve Mordue: I think the two challenges we've had around licensing are that Power Apps versus Power Apps. We've got these two products that really are our different products that share the same name and that puts some confusion in customers where they think they already have Power Apps. Ryan Cunningham: Have it right. Steve Mordue: They don't understand why they have to go buy Power Apps or they have Power Apps. And the other one is the passes, the per user or the per app passes. Those are assigned in a different way than all the other licenses they have been using internally for years. It's the only thing that's assigned that way. So it's a different process and they're looking at how do I do this? I've assigned licenses all the time. I don't understand how to do this. Steve Mordue: Those are two spots if you could personally take as a favor to me, go clean up the pathways [crosstalk 00:59:39] on those to make that as smooth as possible for people to understand, that would be that would be awesome. Ryan Cunningham: And that feedback is well heard across the market. I mean, we are at the pace that we were trying to do some work on the first problem to clarify really Power Apps for Office from our apps for stand-alone. And then separately the per app concept is a really powerful concept and actually a lot of organizations have embraced it. I don't know if I'm allowed to say this. there's more monthly active usage of apps on a per app license today and this has been true for many months than there were on either the older two licensed models, right? Steve Mordue: Sure. Ryan Cunningham: I mean it hunts for a lot of people when they can realize, "Oh, hey. This is a way for me to apply the value of the platform to a use case without having to go have this broader discussion about committing the entire organization to an unlimited number of apps." Steve Mordue: And just a difference of cost Ryan Cunningham: It's a different concept for people. Steve Mordue: And just a difference of cost. At $40, I can afford to have 10 people use this. Ryan Cunningham: Right. Steve Mordue: At $10, well I can afford to have 40 people use this. So suddenly, strictly related to cost, you're going to see that usage explode on those lower cost licenses because those are people now using an app that weren't going to be able to use it before. They weren't going to justify the expense for that level, that tier if you will. You start getting into 10 bucks, I mean that's pretty much anybody in the organization you could justify 10 bucks for. Now suddenly, everybody has an app. Ryan Cunningham: Yup. We've seen a number of customers already even though this has been in market only about a year. Start there and then very quickly realize, actually we want unlimited [inaudible 01:01:25] people through the transition is a phase as well. Steve Mordue: This is something that you take in account as a builder of apps also if you're wanting to try and build for that, you build your apps understanding the licensing structure and you design for it. So listen, Ryan, I appreciate you taking this time out of your, obviously not busy afternoon. Ryan Cunningham: [inaudible 01:01:50] Steve Mordue: A rare not busy afternoon for you, I'm sure. I'm feeling very lucky to have caught you when I did. Ryan Cunningham: Sure. Steve Mordue: Any closing thoughts? Ryan Cunningham: Hey, keep doing what you're doing, Steve both being a rock in the community and also pushing us on the platform to make it better. I think ultimately we see this as a thing we're doing together and I mean that really genuinely. We don't sit in an ivory tower. [inaudible 01:02:18] When we do, we make plenty of blunders, but I think this thing we are building is bigger than lines of code. It's a mindset and I think the more that the community embraces it, the faster we go. So I really appreciate you and everybody that is hopefully going to listen to this someday and participate. Steve Mordue: There'll be thousands listening. There usually are. So don't worry. Ryan Cunningham: Yeah, 100%. Thanks for the call, Steve. Steve Mordue: All right. Cool, man. Talk to you later. Ryan Cunningham: Be well, peace.    

Today, Microsoft business Applications group is announcing a special offer for Power Apps Per App Passes. It felt pretty significant, so I thought I would write a short post on it. The Offer Starting today, you can buy Power Apps Per App Passes for $3 each. The catch? Minimum 200 users... but still.. that is a pretty big deal for mid-sized and above companies. For example, combined with our free RapidStartCRM, that gives you an enterprise grade CRM for 200 users for $600/month!!! In addition to this offer, the Power Apps Per User plan is $12, instead of $40, but that has a 5K user minimum, so really for enterprise only. Let's do some math Wah, I don't have 200 users!  Well, $600 (the minimum) would also be equal to 60 users at the regular price. So any number of users over 60 starts saving money. For example 100 users ends up costing $6/user, 150 users ends up costing $4/user, etc. But, if you have less than 60 users, there is no advantage, so SMB is basically out of luck. Availability The Power App Per App pass promotion is available through Volume Licensing or CSP. The Power Apps Per User promotion is only available through Volume Licensing. Neither offer is available via Direct at this time. What happens when it ends? If purchased via CSP, the offer is good for one year, after that you should expect to go back to the $10 price, unless Microsoft decides to extend this (a possibility). Via Volume Licensing you can keep these prices for up to 5 years!!! This is just a short post, because I was excited about this. Contact your partner and ask them about it!

I recently became aware of an interesting concept in psychology called the Dunning-Kruger Effect, and Citizen Developers came to my mind. What the hell am I talking about now? Read on to find out. The Dunning-Kruger Effect Essentially the Dunning-Kruger effect is one's own perception of their reality. Often displayed as the following image: For those of you who are listening to this, instead of reading it, I will describe the image. On the vertical axis is confidence level, from low to high. On the horizontal axis is Competence level, from "Know Nothing" to "Guru". It seems that many people, who know nothing, can have high confidence of their knowledge in spite of that fact that they... well... know nothing. In the Dunning-Kruger model this places these people at the peak of "Mt. Stupid". I am very familiar with that particular peak have spent my early 20's there. Following the peak of Mt. Stupid, is the Valley of Despair, where one realizes that they actually know... well... nothing, and their confidence plummets. From there, they travel the "Slope of Enlightenment" back up, slowly, until they reach the "Plateau of Sustainability", or actual Guru level. This assumes they remain on the "Slope of Enlightenment" long enough. Citizen Developers Almost every other day, I am on the phone with Citizen Developers at various stages of this model. Like all of the low-code platforms, the Power Platform's primary goal is to "enable" Citizen Developers. Unfortunately, all of the Low-Code platforms, including the Power Platform, present themselves in such a way as to give a person who "Knows Nothing" very high "Confidence". Thus, marching them Pied Piper style to the peak of Mt. Stupid. I have spoken to Citizens with this high confidence, aka "Cocky", and after about 30 minutes of conversation. aka "Enlightenment", have unintentionally knocked them off the peak and into that valley. Well... not the really cocky ones. Riding the Slope I have been involved with Business Applications for over 20 years and still feel firmly on the "Slope of Enlightenment". Whenever a platform, in my case Microsoft, adds a slew of new capabilities, that "Plateau of Enlightenment" just moves farther out. The best that the most knowledgeable and experienced of us can hope for, is to remain on the Slope... indefinitely. When a "Citizen Developer" thinks they are as capable as one who has been on the Slope for 5-10 or 20 years, they are clearly straddling the peak of Mt. Stupid. While I am not easily impressed by your Power App, I am professional enough to not laugh out loud at your feeble effort, since I understand, sitting on the Peak, you are quite proud of your accomplishment. Circumventing the Peak In my experience, this idea will be harder for men than for women, because it requires reading directions. But if you want to bypass the Peak, start at the Valley. Since you would not have gone to the Peak in the first place, the Valley is not one of despair, but rather the beginning of your journey on the Slope. If you want to do this right, and many say they do, but actually don't, then you need to invest the time. Do not fall for the over-confidence building marketing messaging from any low-code platform. Why? 25% 25% is about the percentage of our practice's work that is allocated to fixing things built by Mt. Stupid flag planters. I am reminded of a buddy of mine when I was a teenager. He thought he was a great mechanic, but every time he rebuilt something, like an engine, there was this odd pile of parts leftover. When asked about them he would say something like, "I'm not sure what those are, but they are definitely not needed". As I recall, his vehicles were always on blocks, and I never saw him drive one. A Fork in the Road What many Citizens miss are the forks in the road. Some are obvious, and still the wrong one is taken, and many are not so obvious. Where this matters is down that road, when the clear realization that the wrong fork was taken becomes apparent. I'm not sure if any statistics exist, but I would assume the number of efforts that went the wrong way, and were then either abandoned in frustration, or taken all the way back to the fork, is quite high. The biggest thing that Mt. Stupid does not provide, is a clear view into the future. However, after a while on the Slope, the future becomes quite predictable. Back to the Slope The Slope of Enlightenment is vast, and as I said, even those of us with decades on it, are still climbing. So where does a Citizen even start? I can tell you where we start. First, before building anything, we create the data-model. Apps are pretty easy to change, but the data model will eventually expose any wrong forks taken, and these tend to be the most complex to reverse. Second is typically the UI, getting the data onto forms in a usable way... this is harder than it sounds if you take into account user friendliness vs. function. Lastly is automation, which seems to be the thing too many Citizens are way too eager to get to. If this post sounds like I am bitch-slapping Citizens.... I'm not. I am fully cognizant of the movement, and it is actually not even a new movement. We still spend time unwinding Access databases built by tech savvy, but not business savvy Citizens of those days. I'm just suggesting that scaling Mt. Stupid does not give the same satisfaction as scaling Mt. Everest.  

James Phillips, the head of engineering for Dynamics 365 and the Power Platform, that we all either use, or make a living on, recently tweeted "The name changes will continue until morale improves". It was a joke people!!! Relax My inbox blew up with people asking me what "morale" issue James was referring to. Jimbo was paraphrasing an old quote that I used for the title of this post. In fact, Jimmy is not even responsible for naming as far as I know,  that merry-go-round is operated by Alysa Taylor's team. I think JP was acknowledging the angst of name changes in a humorous way. So.... relax... morale is fine. But for some, there are legitimate concerns with certain motions other than naming. ISVs on Edge Despite James' public insistence that Microsoft wants to be a platform company, his product engineering teams are continuing to crawl up-the-stack. It was not that long ago, that the position expressed by Microsoft was, we will never go vertical, that is for our partners and ISVs. It feels to me like the recently launched "Microsoft Cloud for Healthcare" is pretty darn vertical. I also assume this is the first of more "Industry Clouds" to come. Microsoft's message to ISVs? "There's plenty of opportunity for ISVs here".  I'm not convinced yet. Keeping up with the Jones' This is most likely a Microsoft reaction to similar motions by Salesforce. I do understand the competitive forces in the marketplace, and reacting to them is necessary. But one of the reasons I moved from a Salesforce Consultant to become a Microsoft Partner 10 years ago, was the "Partner First' ecosystem. "Partner First', or 'Partner Led" have never been part of SFDC's lexicon. At the moment, I am struggling to reconcile Satya's words with some of these motions. You will eat it, and you will like it Historically, Microsoft provided the platform, and some relatively generic applications, that were then extended by SIs and ISVs to meet the specific requirements of verticals, including healthcare. It has been the meat of a business application partner's business. It feels to me that these Industry Clouds scrape much of the meat off partners' plates, and onto Microsoft's. It feels like we are left with mostly vegetables... and I never liked vegetables. Get on, or get out of the way None of us can say that Microsoft has not been crystal clear in their guidance to Partners and ISVs in the last few years: Get Vertical! Seeing the huge vertical opportunity, maybe Microsoft just got tired of waiting for us all to come around. So "Partner Led" becomes "Partners Follow", I can't say that I blame them, I'm not a particularly patient person either. Looking at a vast unmet opportunity, and sitting on your hands waiting for partners to see and act on it, would probably drive me to eventually elbow past the stagnant herd also. Seeds were planted I hate to say "I told you so"... but I did. I saw this coming with the initial launch of the first "Industry Accelerators", free data models with "example apps". Again, not enough of us bought into the accelerators, so "Industry Clouds" built by Microsoft on top of them, was an obvious next step. "Example Apps" evolved into finished, supported and SKUed applications from Microsoft. Impact on ISVs and SIs? It's too early to tell what the impact will be from these motions. Clearly if you had built extensive healthcare IP, there will be an impact, you may even find yourself competing with Microsoft in some cases. If you were thinking about building IP for Healthcare, you may have to focus on the vegetables now. For SIs, what you may have charged historically to build out a healthcare solution, will likely be less for extending a pre-built "Industry Cloud" solution. Who wins! This motion will be a win for the customers of course, by potentially lowering development costs, and having more direct support from Microsoft for Microsoft-built stuff. But I really feel that Microsoft will be the biggest winner. I have written before that Partners are simultaneously Microsoft's biggest asset, and biggest liability. While opening every partner presentation with the obligatory "Thank You Partners!" slide, there have been distinct moves to reduce their dependency on partners from Microsoft's first stepping into the cloud. "Citizen Developers" for one obvious example. I'll conclude this post by saying that, no business model is immune from disruption, and that includes Partners.

When I moved from Salesforce to become a Microsoft partner about ten years ago, they were just launching the "Advisor" model for cloud license sales. The road got rocky after that. Life was Good The Advisor model was great. Microsoft handled everything, billing, support, collections, etc. All we had to do was bring customers and get paid a commission on the licenses that were bought. Cloud was exploding at that time a rate Microsoft did not seem prepared for. The Advisor model was putting too much of a strain on Microsoft, so CSP was born. CSP sought to put Partners or Distributors in the line of fire, in front of Microsoft. As a CSP, you were now responsible for billing, support and collections. CSP Bumps Microsoft launched CSP in basically two flavors, Direct or Indirect. The Indirect model was were partners would transact though a distributor. But distributors seemed to have been caught flat-footed at launch, and not a single one of them had even a plan to figure this out. Distributors were still reeling from the loss of hardware and CAL sales as the cloud loomed larger. The other flavor was Direct CSP, originally intended for large partners. The problem was that large partners were moving to cloud way too slowly. Desperate to get out from under the burden, and not having the patience to wait for Disti to get their shit together, Microsoft decided to lower the bar to entry for Direct CSP, and a bunch of small partners, including us, rushed in. Our Strategy The CSP has support responsibility, meaning in the Indirect model, the Distributor was responsible for support, something they were ill-equipped to provide. But, as a small partner we were not really equipped to provide significant support either. So we became both a Direct and an Indirect Partner. My thinking was, that if we had a customer who looked like they would need a lot of support, I would run them though Disti, otherwise we would take them Direct. It seemed like a good plan, but again, Disti was not prepared or capable of anything. Simple things like adding a license was a huge project. Our Shift At the urging of Microsoft, we got into some things we were not particularly good at. As a CRM partner, we suddenly found ourselves selling Office 365 and Azure, and we pushed all of that through Disti. It was a mess, where our CRM customers thought we were awesome, our non CRM customers, rightfully thought we were idiots. So I got out of that business by transferring it all to a Gold Office 365 partner. Now we were back where we should have stayed, a CRM-Only partner. As a CRM partner, working with CRM customers, we had little need for support, from either Disti or Microsoft, so we dropped the Indirect relationship and went all Direct. Things were good. Microsoft Knocks A couple of years ago, I got an email from Microsoft saying that they were adding a new wrinkle to Direct CSP. "Advanced Support" from Microsoft would now be a requirement, at a minimum cost of $15K/yr. I thought for a minute about getting out of the licensing game. This was an obvious move by Microsoft to get rid of partners exactly like us. That $15K was eerily close to our entire license margin!  But licenses were still petty expensive, and I thought we would continue to grow that side, so I bit the bullet and paid it (a decision I regret). Worthless As a partner focused deeply on a single product, we really did not need any support from Microsoft. I think we may have opened one ticket, found the support to be no better than standard support, and never opened another ticket. Support was just a tax on our revenue... at least in our case. When the MS rep called about renewal, I said we were going to pass. He told me that we would basically be kicked out of the program. I pressed him on this, "What about our existing customers?", and he conceded that we would be able to maintain our existing customers. I decided that was good enough. I suspected that MS did not have any technical enforcement, and was correct, as we were still able to add new customers. The $10 Pass When Microsoft launched Power Apps at $40/month, and then the $10 Per App pass, we immediately started changing our customers licenses, where we could, to the lower cost licensing. Obviously this lowered our license margin revenue significantly, but it was the right thing to do for the customers. It also lowered our total license revenue to Microsoft. Microsoft Knocks Again I got an email from Microsoft the other day, that I am sure was sent to all small Direct CSPs. The next effort to get rid of small partners in the program. Microsoft has decided that the minimum revenue to remain in the program was now $300K/yr... oh and you had to pay the Support tax too. Otherwise you would be off-boarded. Off-boarded from a program they asked me to join. To be honest, since we are now focused on selling our solutions, that run on low cost licenses, there is not much of a license margin opportunity for us in CSP anyway. Option For those that don't meet the new requirements, Microsoft is suggesting we go to Indirect with a Distributor. I have no interest in that, Distis are idiots. What I would prefer, is to continue to manage my existing customers, and eventually move them to Microsoft Directly over time as their renewals come up. I have asked what the process is for that, and have not been given an answer. Pricelists Microsoft updates the Cloud Reseller Pricelist monthly. Often new SKUs are added, and some SKUs are removed. Once a SKU is removed, it can no longer be sold to new customers, but existing customers of that SKU can continue to add and remove licenses based on that now deprecated SKU. It is not at all clear to me that customers will be able to keep these SKUs in a transition to either Disti or Microsoft, which would now be a new tax on customers, if they are forced to move to the current pricelist in the transition. The Undesirables We all have them... undesirable customers. It would be nice to just flip a switch and get rid of them, but I made a commitment. In some cases I have agreements in place with terms that I regret, but again, I made a commitment. I can make up new rules for new customers, but I feel bound by the deals that were made with current ones. Maybe if I had as many customers as Microsoft has Partners, I too could be ruthlessly arbitrary... but... I can't. Basically this is just a "venting" post with no real conclusions, but I am sure there are other partners who are in a similar situation, so I thought I would share my opinions. Feel free to share yours below. Here are a couple of links of interest: https://docs.microsoft.com/en-us/partner-center/direct-partner-new-requirements https://docs.microsoft.com/en-us/partner-center/restricted-direct-bill-capabilities https://docs.microsoft.com/en-us/partner-center/transition-direct-to-indirect  

In one of our private MVP channels, another MVP “joked” that Jukka Niiranen should consider reading his blog like I do, so I “joked” that I would do it for him, and then Jukka “joked” that he “fully approved this innovative art performance“, and so.... all jokes aside… a Special Edition of Steve Reads his Posts, where I instead, Read one of Jukka’s posts. But before I do that I have known Jukka for several years now, and I consider him "the" top blogger when it comes to all things Power Platform. I also write a lot about the Power Platform, but I have a much different style than Jukka. If you could only read one blog to get the latest information on the Power Platform, I would easily recommend his blog over mine. But we both know you can read more than one blog, so you should follow both of us. It was not hard to pick a great post of Jukka's to read, I simply opened his most recent, since all of his posts are brilliant. I’m reading his own words, unedited, so where you hear “I”, it is actually Jukka. Please enjoy this special episode of “Steve reads Jukka’s Post”.

In this past week, I had two potential customers who were deciding between our RapidStartCRM Power Apps or Zoho. For one of them, I had no choice but to recommend Zoho. I you want to know why, keep reading. Customer Number 1 I got a call from Bob, the owner of Little Bitty Inc., in Podunk, Nebraska. Bob was managing the finances for his 5-person business in his checkbook, and managing his sales with a Google spreadsheet. He said he had been considering Zoho, but then saw an ad for our RapidStartCRM talking about how it was "Simple-to-Use". I realized at that moment that "Simple-to-Use" is a relative term, and was pretty sure that our app was not "Simple" enough for Bob. Plus he wanted to move his checkbook onto something, and that is not what RapidStartCRM is. My mind flashed across an integrated RapidStartCRM/Business Central scenario for a brief second, and then I said, "Bob... if I were you... I would go with Zoho". I'm all about RapidStartCRM, or even just Power Apps, being a path forward from spreadsheets, but for Bob... it was going to be too much of a leap. Zoho was going to be good enough for Bob. I actually like Zoho, and for a customer like Bob, I think it is the perfect solution. Zoho is not particularly powerful, nor extendable, but then... neither was Bob. Customer Number 2 I got a call from Rich, the IT Manager at Acme Solutions, a 30-person business in Atlanta. Rich had already moved his company to Microsoft 365, and was ready to tackle his sales team's challenges. They were currently using Excel Spreadsheets and SharePoint to manage their pipeline. Rich was also looking at Zoho, but just their CRM capabilities, Acme did not need the finance side. But since Rich had recently moved to Microsoft 365, he thought he would explore Microsoft's options. He did a trial of Dynamics 365 Sales Pro, and while he liked the power and extensibility, compared to Zoho, he concluded that it was simply too complex, and would need to be modified quite a bit to meet their specific requirements. He knew that Zoho could not be modified to meet his exact requirements, but it was cheaper and easier to use. So he had decided to start with Zoho, and see how far it would take them... it was better than spreadsheets. He got a call from a Microsoft rep because he had trialed Sales Pro, and after explaining his concerns, she suggested he check out RapidStartCRM, and so we ended up on the phone. Knowing he was considering Zoho, I assumed price was important, so I started by pointing out to Rich that RapidStartCRM was free, and ran on a $10 Power Apps Per App license. He informed me that was about half the cost of Zoho's lowest plan, which I opened a browser and confirmed, Zoho's base plan was $18/month. This actually backfired on me as Rich became suspicious that since RapidStartCRM was less, Zoho's CRM must have more. I asked about his requirements and it sounded like 80% of them were covered with RapidStartCRM, out of the box, the same 80% that Zoho also covered. Then we explored that 20% that Zoho could not get to, and even though the requirements were quite specific, none of them were complicated to extend to in RapidStartCRM, which again is a Power App. In fact, we extended the conversation of his requirements, talking about some platform capabilities he was not even aware of, and then he decided those were now critical! I really love the "discovery" aspect of these calls. Solution Fit I would love to say that RapidStartCRM is the ideal fit for any company, in any situation, but that's simply not the case. It was the perfect fit for our new customer Rich, but not a good fit for Zoho's new customer Bob. I think the key difference is looking out beyond today's need. While there are plenty of simple-to-use apps, including Zoho and RapidStartCRM, it is really about where you can eventually go with them. Microsoft likes the term "No Cliffs", meaning you will never hit a wall with the Power Platform and have to migrate elsewhere. I like that term also, and so do companies that are expecting to grow into bigger companies. The offer you can't refuse Two things happened that changed the landscape for us. The introduction of the $10 Power Apps Per App Pass (license), and our decision to make our apps free. Where I had been quite used to making the case for more capabilities at a higher cost than the competition, we are now offering more capabilities at a lower cost than the competition. It sure makes selling easy! :)