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The real deal on Microsoft CRM

Some have dismissed the soon-to-be-released Microsoft CRM as "Outlook on steroids," but independent CRM analyst Rich Bohn says this is mid-market software to take seriously.

Rich Bohn,

In February Microsoft Corp. announced that by the end of 2002 it would deliver Microsoft Customer Relationship Management (CRM), the first Microsoft business solution built on .NET. From that very first announcement rumors and speculation began to swirl. Put all the hype aside for a moment, this is an important new CRM solution. Here are its key features:

Microsoft CRM pricing

Microsoft CRM Sales Standard - $395 per named user

Account and Contact Management, Calendar, Notes & Attachments, Direct E-Mail via Microsoft CRM Exchange Connector, Activity and Task Management, Search, Reports, Opportunity Management, Leads Management, Correspondence/Mail Merge, Territory Management, Microsoft Outlook Client

Microsoft CRM Sales Server required

Microsoft CRM Sales Professional - $795 per named user

Includes all Microsoft CRM Sales Standard features, plus: Quotas; Quotes, Orders, and Invoices; Workflow; Product Catalog; Competitor Tracking; Sales Literature; Sales Process Methodology; Leads Routing

Microsoft CRM Sales Server required

Microsoft CRM Customer Service Standard - $395 per named user

Account & Contact Management, Calendar, Notes and Attachments, Direct E-mail via Microsoft CRM Exchange Connector, Activity and Task Management, Search, Reports, Case Management, Knowledgebase Management, Service Request, Activity and Case Queuing

Microsoft CRM Customer Service Server required

Microsoft CRM Customer Service Professional - $795 per named user

Includes all Microsoft CRM Customer Service Standard features, plus: Contact Management, E-Mail management, including auto-responses; Case Routing; Product Catalog; Workflow

Microsoft CRM Customer Service Server required

Microsoft CRM Suite Standard - $695 per named user

Includes all features and functionality of Microsoft CRM Sales Standard and Microsoft CRM Customer Service Standard

Microsoft CRM Sales Server and Microsoft CRM Customers Service Server required

Microsoft CRM Suite Professional - $1,295 per named user

Includes all features and functionality of Microsoft CRM Sales Professional and Microsoft CRM Customer Service Professional

Microsoft CRM Sales Server and Microsoft CRM Customer Service Server required.

Microsoft CRM Sales Server - $995

Only one Microsoft CRM Sales Server is required per deployment, and is required only when using Microsoft CRM Sales Standard OR Microsoft CRM Sales Professional

Microsoft CRM Customer Service Server - $995

Only one Microsoft CRM Customer Service Server is required per deployment and is required only when using Microsoft CRM Customer Service Standard OR Microsoft CRM Customer Service Professional

Microsoft CRM Application Integration - no charge

Integration with Outlook, Word and Excel Salespeople can access full sales functionality from Outlook, whether they are online or offline. In addition, users can create, send and print communications to Microsoft Word Mail Merge, as well as export data to Excel for further business analysis.

Lead and opportunity management Leads can be easily imported into Microsoft CRM and then automatically assigned to a salesperson based on territory, product or other criteria. Salespeople can easily convert qualified leads to opportunities without data re-entry, and then track opportunities throughout the sales cycle.

Order management, product catalog, quotes and orders A full-featured product catalog includes support for complex pricing levels, units of measure and discounts. Based on product catalog data, salespeople can quickly create accurate quotes and convert them to orders, automating processes to save time.

Integration with Microsoft Business Solutions and third-party applications Microsoft CRM integrates easily with Microsoft Business Solutions applications, including key data mapping for contacts, accounts, product catalog, orders, invoices and more. This allows salespeople to have a centralized and complete view of all customer and product information from one location. In addition, Microsoft CRM functionality can be exposed through secure APIs and SOAP for integration with third-party applications and XML Web services.

Sales process methodology Sales opportunities can be tracked and closed consistently and efficiently with workflow rules that automate stages in the selling process. Microsoft CRM includes selling methodologies that can be customized to meet specific sales processes.

Workflow Customizable workflow rules automatically assign leads to salespeople based on territory, product or other criteria, as well as route service requests to the appropriate representative, team or queues for resolution or escalation. Workflow rules and templates also make it easy to generate and send auto-response e-mail messages in response to customer requests.

Case management Microsoft CRM enables employees to create, automatically assign and easily manage customer service requests from initial contact through to resolution, easily managing communications and activities in each case.

Knowledge base Employees can quickly resolve common support issues by using a searchable knowledge base that contains relevant data. Built-in review processes ensure that published information is complete, correct and properly tagged for search.

Reporting Microsoft CRM includes more than 100 pre-built reports to empower management and employees in making informed decisions quickly, measure and forecast sales activity, and identify opportunities, trends and problems.

Let me share my own feelings and observations based on a series of meetings over the last few months with the development team at Microsoft's Redmond, Wash.-headquarters and a week of intense discussions and product demonstrations at the company's recent Stampede conference for Microsoft Business Solutions partners.

Microsoft still has a reputation, at least among their software rivals, that it takes them three major product releases to "get it right." Microsoft did make several decisions about features that would have to wait until a 2.0 or 3.0 release; for example, this release is very light on marketing capabilities. However, this 1.0 release is a very solid product offering that will meet the needs of many sales organizations. Yes, the product will improve and evolve with subsequent releases. However, Microsoft CRM 1.0 is already superior to many products on the market.

Microsoft has been very candid in declaring Microsoft CRM a great solution for the middle market. However, many pundits have written that the product is only appropriate for the very small business. Or, worse yet, that this is some secret effort to back into the enterprise market. I believe Microsoft is making a very simple observation: The middle market is huge and it is vastly underserved. Wherever they might take this product in the future, today it is clearly targeted at the middle market. However, Microsoft is not placing any artificial "seats" requirements on the product, which is a refreshing change from the strategy pursued by most current CRM vendors. Rather, Microsoft will leave the "seats" question to their resellers to decide where best they can provide value. On the low end, Microsoft CRM would not be appropriate for single users (like most users of ACT) since it relies on other Microsoft server products, specifically Active Directory, Exchange, SQL Server and the partner version of BizTalk Server. Leave the technical details aside for a moment; this means a minimum installation would require a server running at least Small Business Server. This is a very reasonable solution for a group as small as five or 10 users. At the other end, the company is already performing stress tests with as many as 1,000 users. The key to remember is that Microsoft CRM is built on a scalable infrastructure that has been proven reliable in countless other applications. Today's feature set might not meet the requirements of every large prospect but the company is placing no artificial requirements on minimum or maximum seats.

Some analysts have referred to Microsoft CRM as "merely Outlook on steroids." This is another grave miscalculation. This product is a perfectly nice CRM solution that will genuinely help sales people take better care of their customers and sell more now. First of all, the product really is very easy to use. If you are comfortable using Outlook, you will be comfortable using Microsoft CRM. Everyday tasks like sending e-mails to prospects are mindlessly easy to perform. Yet the product also does a very good job of more complex tasks like opportunity management and customer support.

Though we in sales face many similar situations, every sales environment is unique. This means your CRM solution must be very (and easily!) customizable. Most of the products on the market today are far too difficult to customize. Microsoft CRM just may be the most easily customized CRM solution I have ever seen. It is easy to add new user-defined fields to any of the tables. With a few clicks, you define the data type of the field and appropriate default values or error checking. It is easy to add these new fields to any existing form or create entirely new forms. I'll need some more time to test the workflow capabilities, but already they look as powerful as anything else I see in the middle market today.

A very pleasant surprise for me at the Stampede conference was the strong third party product support already lined up behind the product. As you might expect, Microsoft has already completed work on very powerful integration with their Great Plains ERM solution. Over the coming months, you can expect similar integration with their Solomon, Attain and Axtapa solutions. But there was also an impressive lineup of software developers already active in the CRM world; for example, Rafael Zimberoff of Z-Firm is well known as a developer of great fax solutions for GoldMine and SalesLogix. I have known many of these people for years and in private discussions with me they were unanimous in their praise for Microsoft's efforts to reach out to them and provide whatever resources they need to migrate their independent solutions to Microsoft CRM. For those of you that know I am a nut for drip marketing, I am pleased to report that their will be a perfectly nice drip marketing add-on (complete with letters and action plans from Jim Cecil) available in January. So it is true, Microsoft CRM does not do everything. However, the company already has a proactive strategy to reach out to other independent software developers to fill some of these gaps.

Finally, and perhaps most importantly, you should not underestimate the significance that Microsoft CRM is the first Microsoft business solution built on .NET. This is not the time or place for a full discussion of .NET. Suffice it to say that this is Microsoft's XML Web services platform. .NET contains all that's needed to build and run software based on XML, the lingua franca of Internet data exchange. Yes, there are competing technologies. But, one way or another, this is how all software will be developed over the next few years. Microsoft is spending millions of dollars to develop and promote the .NET platform. So, when I say that Microsoft CRM is the first Microsoft business solution built on .NET, this is a big deal for the company! The development team knows that within the company their efforts are being watched closely, all the way up to the level of Steve Ballmer and Bill Gates. This is powerful motivation to get it right. Outside the company, Microsoft has a large team of people working to get other independent software developers to adopt the .NET development framework. These people are looking to Microsoft CRM to be the "proof statement" for the neat applications that can be developed using these new technologies. All of these factors cause me to believe that Microsoft CRM will continue to be a significant, high-visibility development effort that will get whatever resources are required to create a winning product.

So, if you were contemplating a CRM project in the near future, put Microsoft CRM on your short list of contenders. I will continue to put the product through my full review process. I will beat on them the same way I beat on everyone else! However, so far there has been more to like than to quibble about!

Rich Bohn is an independent analyst of CRM solutions and host of the popular Web site Rich has more than 20 years experience in sales and sales management. You can e-mail him at

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