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Navigating the New Cloud Opportunities of Microsoft Dynamics NAV 2009 R2

by Vjekoslav Babic
NAV Consultant, Microsoft Services, Microsoft
February 23 2011

While technology progresses at a seemingly unstoppable pace and the opportunities of cloud computing and SaaS enterprise solutions seem limitless, Microsoft Dynamics NAV partners and customers have been left, to some degree, scratching their heads.  For small and mid-sized businesses, Dynamics NAV has historically offered little in terms of solutions not delivered on-premise.

But with Microsoft Dynamics NAV 2009 R2, the latest NAV release, Microsoft has taken the steps needed to not only enable unprecedented flexibility in deployment options, but also demonstrate its determination to enter the cloud market for small and mid-market ERP, if not directly, then by enabling the Dynamics partner channel.

Before the Dynamics NAV 2009 R2 release, NAV wasn't too cloud-friendly. In fact, SaaS offerings for NAV have been pretty much earthbound. Its architecture and technical capacities largely favored the on-premise deployment model. Hosting was possible, but it offered few of the benefits that SaaS software offerings typically bring to the table. If we had talked in a "pre-R2" world about compelling advantages of a SaaS Dynamics NAV solution, then it likely would have been a short conversation. NAV was simply a domestic animal - as long as you kept it on-premise, it served you well.

R2 is changing this fundamentally.

NAV over Internet

There are two primary reasons for low feasibility of SaaS NAV (I'll touch on what it means to run NAV "in the cloud" a bit later) in previous versions. In versions prior to 2009, NAV was a fat-client without any support for distributed architectures, and while 2009 resolved this issue, it brought a new one: it didn't allow non-intranet deployment due to security restrictions. R2 is now addressing both these issues, efficiently.

To put it simply, earlier ...

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About Vjekoslav Babic

Vjekoslav Babić is an independent Microsoft Dynamics NAV consultant, trainer, author and blogger, with 10 years of experience in NAV and 16 years of experience in IT.

As a solutions architect and a project manager with a leading Microsoft Dynamics President's Club service provider company, as a Microsoft Dynamics NAV consultant with Microsoft Services, and as an independent consultant, he has been working on Microsoft Dynamics NAV implementations ranging from tiny one-man-bands to international mega-corporations, delivering services and trainings all over the world.

In 2008, Vjekoslav co-authored the acclaimed book "Implementing Microsoft Dynamics NAV 2009". Vjekoslav runs an active blog about NAV implementation, project management and development best practices, acts as a columnist and editorial advisory board member at, and as a columnist in a number of other web or printed periodicals in Croatia and worldwide. Vjekoslav is also a frequent speaker at Microsoft or Microsoft Dynamics conferences.

Since spring 2010, Vjekoslav has been awarded the prestigious Microsoft Most Valuable Professional (MVP) award for Microsoft Dynamics NAV.

Submitted by wishlist on Mon, 07/04/2011 - 10:43 Permalink

I don't agree that hosting reduces the cost of IT. It merely moves it - either to some other place in the financial statements, or to some other time. In the long run, it will cost the end user more. The Microsoft SaaS licence model requries the customer to rent every piece of the technology stack installed on the server. When you start adding up the cost of renting not just NAV, but Windows, SQL Server, Terminal Services, perhaps Sharepoint and Office, the costs quickly escalate. And just because the server is sitting somewhere in the Cloud, doesnt mean it is being managed and maintained for free. Somewhere, there are techies sitting running backups, maintaining user rights and managing firewalls (at least we trust so), and someone (ie the customer) still has to pay for them. Companies tend to keep their ERP deployments for at least 5 years. For anything beyond 3 years, outright purchase is cheaper.

In reply to by anonymous_stub (not verified)