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What is the Return on Investment for Dynamics 365 Sales?

Moving to Dynamics is a big investment – How can you be sure that your investment will be worth it?

Independent research shows that over 3 years the Dynamics 365 ROI is 215%

Other research shows the broader Dynamics family can give a ROI of $16.97 for every $1 spent

Where do these figures come from?

Microsoft regularly commission independent research to assess the impact of their products.

This research, by Forrester Consulting interviewed nine decision-makers at organisations with new Dynamics systems over a period of 3 years.

Prior to installing Dynamics 365, these organisations did not have formal CRM systems and relied on either home-made systems or a variety of smaller disjointed collections, including spreadsheets, documents and hard copy documents.

Their headline findings were

The Total Economic Impact™ Of Microsoft Dynamics 365 Sales - Key Findings

In brief

  • A 215 percent return on investment (ROI) over three years.
  • Seven months to payback.
  • A 15 percent increase in seller efficiency when collaborating with team members.

Microsoft Dynamics 365 Sales enables companies to increase their sales efficiency and improve their efforts’ effectiveness.

Streamlined workflows and automation of previously manual tasks give sellers more time to sell and sales managers more time to coach their teams.

Better visibility to customer and pipeline data helps sellers prioritise their efforts and engage more productively with their prospects, resulting in higher close rates.

With Dynamics 365 Sales, the entire sales function works with a single reliable data set.

The Total Economic Impact™ Of Microsoft Dynamics 365 Sales
Cost Savings And Business Benefits Enabled By Dynamics 365 Sales

March 2022

The research expanded on the reasons for the cost savings

How Does Dynamics reduce costs?

The quantifiable cost reductions included

Quantifiable ways Dynamics increases profit and decreases costs

The report highlighted 5 ways that Dynamics saves organisations money

  • Increased operating profits: Dynamics 365 Sales helps organisations achieve higher sales revenue. Sellers can work more efficiently and have a better understanding of customer needs, leading to more productive conversations with prospects.
  • Better seller productivity: Dynamics 365 Sales streamlines the sales proposal process, making it quicker and easier for sellers to prepare proposals. Sellers can collaborate better with colleagues, saving time and improving productivity.
  • Improved sales manager productivity: By automating processes and providing visual dashboards, Dynamics 365 Sales reduces manual effort for sales managers. They can spend less time gathering and analysing sales data, resulting in increased productivity.
  • Boosted sales operations productivity: Dynamics 365 Sales enables collaboration between sales operations staff and sellers, making sales processes more efficient. It eliminates the need for staff to log into multiple sales applications, saving time and improving productivity.
  • Accelerated time-to-productivity and cost savings in new hire onboarding: Dynamics 365 Sales provides comprehensive information and workflows, enabling newly hired sellers to become productive quicker. Managers spend less time onboarding them without impacting their learning, resulting in cost savings.

Unquantifiable ways Dynamics decreases costs

  • Support of corporate strategic initiatives: Dynamics 365 Sales enables organisations to support strategic initiatives such as digital transformation, modifications to go-to-market strategy, and cultural change.
  • Improved decision-making: Dynamics 365 Sales empowers sales-related functions with deeper insights, aiding decision-making processes.
  • Better performance and accountability: With increased transparency around sales results and trends, Dynamics 365 Sales drives performance improvement, accountability, and consistency.
  • Time freed up for higher-value activities: By reducing low-impact tasks, Dynamics 365 Sales allows sellers and sales managers to focus on higher-value efforts such as strategising on accounts and coaching teams
  • Identification of new sales opportunities: Dynamics 365 Sales helps sellers identify new sales opportunities within existing customer accounts through renewal prompts, internal referrals, and a holistic view of each customer.
  • Ease of use and time savings: Integration with other Microsoft products provides ease of use, time savings, and other benefits for end users and IT staff.
  • Improved forecasting: Dynamics 365 Sales enhances forecasting within companies by providing more reliable sales pipeline data, enabling improved forecasting for areas responsible for product or service delivery.

Get the full report

How accurate are these figures?

Measuring the return on investment for CRM is a notoriously inexact science. There are so many factors at play and a simple profits minus costs calculation can yield poor results

Why is it difficult to measuring the Return on Investment (ROI) for a CRM system like Dynamics Sales?

  • Estimating the Dynamics 365 ROI isn’t as simple as calculating the returns of something more tangible like a sales or marketing campaign.
  • Tracing the reasons for profits due to CRM investments is tough, especially at a strategic level. Some many other factors influence profit, that it’s difficult to isolate the profit attributed solely to CRM.
  • Additionally, there are many overheads that must be included in calculating the gains from a CRM system, including salaries, marketing campaigns, and other expenses. Accurately quantifying these costs can be complex.
  • To accurately measure Dynamics 365 ROI, you must assess various metrics such as cost per lead, revenue per lead, and overall revenue. This involves data analysis and tracking performance over time.

Other research

Broader research of companies that adopted the wider Dynamics 365 family, found

During the first three years of deployment, for each dollar spent, a company recovered an average of $16.97. That’s a Dynamics 365 ROI of 1597%

The researchers, Nucleus combined data from hundreds of companies across Europe, US and Canada.

In analysing the results of Microsoft Dynamics 365 deployments, Nucleus found that for every dollar spent, companies realised an average of $16.97 in returns. This is significantly higher than the average for both enterprise resource planning (ERP) and customer relationship management (CRM), which deliver, on average, $7.23 and $8.71 respectively. Nucleus found that companies taking advantage of Microsoft’s investments in cloud and usability, as well as integration and analytics, were able to achieve significant returns by increasing productivity and revenues and reducing costs.

Source: https://nucleusresearch.com/research/single/microsoft-dynamics-365-delivers-16-97-for-every-dollar-spent/

Obviously, this data doesn’t guarantee big cost savings and greater efficiency in your organisation. It’s possible to use Dynamics (or any CRM) and find and increase in costs and user frustration.

To make sure your CRM system is a success, you’ll need

  • Buy-in from your executive team
  • A strong project champion
  • Great project management skills – this can’t be just left up to the supplier
  • Planning for the configuration and implementation of the system.
  • Training and support
  • A continual focus on user adoption
  • Good user interface design
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📆 Last update: February 21, 2024

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