Dynamics 365
Optimizing Dynamics 365 Licensing During
a Global Cloud Transformation
a Global Cloud Transformation
Client industry
Manufacturing & distribution
Implementation period
3 months
Challenge
As part of a phased migration from on-premises Dynamics solutions to Microsoft Dynamics 365, a global company faced a significant increase in licensing costs following Microsoft's enforcement of licensing compliance requirements.
Manufacturing & distribution
Implementation period
3 months
Challenge
As part of a phased migration from on-premises Dynamics solutions to Microsoft Dynamics 365, a global company faced a significant increase in licensing costs following Microsoft's enforcement of licensing compliance requirements.
Key takeaways:
- An audit of Dynamics 365 usage, roles, and licensing requirements
- Roles and responsibilities optimized to align with actual usage
- Processes for moving to Power Platform applications identified
- Overall licensing costs reduced by 30%
Navigating Unexpected Licensing Costs During Cloud Migration
For years, the client had successfully operated its business using an on-premises Dynamics environment. As part of its long-term digital transformation strategy, the company initiated a gradual migration to Microsoft Dynamics 365 Finance, Supply Chain Management, Project Operations, and Commerce.
The transition was designed to modernize business operations while minimizing disruption to users across multiple countries and business units. However, as the migration progressed, the organization encountered an unexpected challenge. Microsoft's increased focus on licensing compliance and user entitlement management revealed that many existing access models no longer aligned with cloud licensing requirements. As a result, projected licensing costs increased significantly, creating pressure on both the transformation budget and the business case for the migration.
Understanding How Employees Actually Used Dynamics 365
To address the issue, our team began with a detailed assessment of the client's Dynamics 365 environment. We analyzed user activity, business processes, security roles, and licensing assignments across multiple departments.
The review uncovered several areas where employees were assigned licenses that exceeded their actual day-to-day requirements. In many cases, users needed access to only a limited set of functions but held more expensive licenses. The organization had also accumulated role structures that evolved over time and no longer reflected current responsibilities.
Redesigning Roles and Access Models
With a detailed understanding of user behavior and operational needs, we redesigned the licensing strategy around actual business responsibilities rather than historical role assignments. Employee roles were reviewed, consolidated, and aligned with specific functional requirements. Access permissions were refined to ensure users received the appropriate level of functionality without unnecessary licensing overhead.
Leveraging Power Platform for Targeted Business Scenarios
During the assessment, we identified several business processes that did not require full Dynamics 365 capabilities but still needed dedicated digital solutions. To address these requirements, we proposed a series of Power Platform-based applications tailored to specific operational tasks. By moving targeted scenarios into lightweight Power Apps solutions, the client was able to provide users with the functionality they needed without assigning higher-cost Dynamics 365 licenses.
The result was a more flexible application landscape where employees could perform task-specific activities through purpose-built tools while core business processes remained within Dynamics 365.
Achieving Cost Savings Without Sacrificing Functionality
By combining licensing analysis, role optimization, and Power Platform alternatives, the client achieved a significant reduction in licensing expenses while preserving business continuity throughout the cloud migration. The initiative delivered a 30% reduction in licensing costs, improved compliance with Microsoft licensing requirements, and established a scalable governance model for managing user access in the future.
Today, the organization continues its Dynamics 365 cloud transformation with greater cost predictability, a streamlined licensing structure, and a technology landscape better aligned with the way employees actually work.
For years, the client had successfully operated its business using an on-premises Dynamics environment. As part of its long-term digital transformation strategy, the company initiated a gradual migration to Microsoft Dynamics 365 Finance, Supply Chain Management, Project Operations, and Commerce.
The transition was designed to modernize business operations while minimizing disruption to users across multiple countries and business units. However, as the migration progressed, the organization encountered an unexpected challenge. Microsoft's increased focus on licensing compliance and user entitlement management revealed that many existing access models no longer aligned with cloud licensing requirements. As a result, projected licensing costs increased significantly, creating pressure on both the transformation budget and the business case for the migration.
Understanding How Employees Actually Used Dynamics 365
To address the issue, our team began with a detailed assessment of the client's Dynamics 365 environment. We analyzed user activity, business processes, security roles, and licensing assignments across multiple departments.
The review uncovered several areas where employees were assigned licenses that exceeded their actual day-to-day requirements. In many cases, users needed access to only a limited set of functions but held more expensive licenses. The organization had also accumulated role structures that evolved over time and no longer reflected current responsibilities.
Redesigning Roles and Access Models
With a detailed understanding of user behavior and operational needs, we redesigned the licensing strategy around actual business responsibilities rather than historical role assignments. Employee roles were reviewed, consolidated, and aligned with specific functional requirements. Access permissions were refined to ensure users received the appropriate level of functionality without unnecessary licensing overhead.
Leveraging Power Platform for Targeted Business Scenarios
During the assessment, we identified several business processes that did not require full Dynamics 365 capabilities but still needed dedicated digital solutions. To address these requirements, we proposed a series of Power Platform-based applications tailored to specific operational tasks. By moving targeted scenarios into lightweight Power Apps solutions, the client was able to provide users with the functionality they needed without assigning higher-cost Dynamics 365 licenses.
The result was a more flexible application landscape where employees could perform task-specific activities through purpose-built tools while core business processes remained within Dynamics 365.
Achieving Cost Savings Without Sacrificing Functionality
By combining licensing analysis, role optimization, and Power Platform alternatives, the client achieved a significant reduction in licensing expenses while preserving business continuity throughout the cloud migration. The initiative delivered a 30% reduction in licensing costs, improved compliance with Microsoft licensing requirements, and established a scalable governance model for managing user access in the future.
Today, the organization continues its Dynamics 365 cloud transformation with greater cost predictability, a streamlined licensing structure, and a technology landscape better aligned with the way employees actually work.
Related case studies