When to Choose Microsoft Dynamics AX Over Microsoft Dynamics NAV
The Microsoft Dynamics suite includes ERP solutions for businesses of all sizes and industries. Over the last decade, Microsoft acquired two ERP companies that resulted in four Dynamics ERP products: Dynamics GP, Dynamics SL, Dynamics NAV, and Dynamics AX.
The two products that have the most crossover are Microsoft Dynamics AX and Microsoft Dynamics NAV. When deciding what product fits what type of company best, a lot of people tend to generalize and view AX for large enterprises and NAV for small to medium size businesses. If only selecting a software was that simple.
In terms of size alone, Dynamics AX is reputed to handle up to 10X more users than Dynamics NAV. However, that doesn’t mean there aren’t smaller businesses using Dynamics AX and larger enterprises running Dynamics NAV. One of our Dynamics NAV clients is a multi-billion dollar publicly traded company with thousands of employees. On the surface, they look like a good candidate for Dynamics AX; however, the solution they required is less complex Instead of taking the traditional approach and looking at both products from a size perspective, we are going to compare by looking at the bigger picture. With this approach, we can evaluate scenarios where it makes more sense to invest in Dynamics AX over Dynamics NAV.
Scenario 1: Complex Business Processes
Complexities come in all shapes and sizes – from accounting compliance to vertical needs. Let’s say your company has different accounting groups in different companies within a consolidated corporate structure. This is a classic example of when the robust functionality of AX will overpower NAV. Dynamics AX works best when either there are multiple accounting groups or a shared services model exists. Dynamics NAV is best suited for organizations with the same accounting group managing the books for multiple entities.
Dynamics AX is built on a platform that better handles more complexities. Dynamics AX has more functionality out of the box.
Scenario 2: Analytical Capabilities
Once you have considered your business process complexities, you need to consider the volume of data being transacted and the resulting reporting requirements. Dynamics AX has richer analytical and reporting functionality than Dynamics NAV, with more modules. The software also has more advanced business intelligence, workflow, and portal capabilities that are beyond what Dynamics NAV natively offers.
Dynamics AX is a powerful platform that can handle great volumes of data without any degradation of performance. It can handle multiple sites across multiple locations and has the capability to easily scale to thousands of users.
Scenario 3: Cloud Availability
This scenario is a little easier to decipher, as Dynamics AX was the first Dynamics ERP product built in the cloud. Dynamics NAV is available on-premise and hosted, but the latest version of Dynamics AX (AX7 or AX 2016) runs natively in Microsoft Azure. This is the best option for companies that are rapidly expanding and need mobility, versatility, and scalability in their ERP solution. The new release brings with it the benefits of the cloud that are most important for business — from simple signup, immediate provisioning, and built-in high availability, and disaster recovery to elastic capacity to add resources but only pay for them when they are being used.
The cloud version, or AX on Azure, is also becoming the Operations Application in the upcoming Enterprise Edition of Dynamics 365, a new cloud product that combines both ERP and CRM capabilities into one solution (release date: October 11, 2016). Dynamics 365 Enterprise Edition is a solution designed for large companies with over 250 employees. By choosing this route, you can merge the powerful functionality of Dynamics AX7 with individual modules for core CRM, in addition to Microsoft’s Power Apps and Flow. This solution is also available for on premise customers as well.
Don’t Spend More Than You Need on ERP
Both Dynamics NAV and Dynamics AX are highly flexible, scalable, end-to-end solutions for a business in need of ERP software. Each solution has an impressive install base spanning across the globe, offering industry-specific functionality to meet your needs. Dynamics NAV is reputed to be the most widely used ERP system in the world, with over 130,000 deployments worldwide. They are also highly configurable solutions that have the ability to manage complex supply chains and inventory. A feature-by-feature comparison really does not properly highlight either of these products and is not enough to help you make the right decision.
No matter what product you choose to support your organization, your decision should be based on the business requirements of your individual needs. Before you decide, make sure you have completed an analysis and documented your organizational needs. Get the help of a partner, like Rand Group, to assist you in this initial discovery phase.
ERP implementations are massive projects that take substantial investments in time, money, and resources. In the end, you need to understand what your organization is trying to manage within the ERP system and align it with the native capabilities of each of these Dynamics products. At Rand Group, we have extensive experience working with clients to evaluate specific software and ensure they implement and adopt a solution of best fit. Get in touch with our team for a full evaluation.
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