A few months ago I wrote about XRM for Financial Services, today I am going to update this article. I will also write about the differences between XRM and Application Rationalisation. The image below I hope illustrates nicely a how a well defined CRM project can transform into to an XRM project and then to a fully fledged line of business application. I must take this opportunity to thank my colleague Bruce McKee who helped me visualise this below:

XRM and Applications Rationalisation

When I think about Microsoft Dynamics I like to consider it in terms of Product & Platform. I described this last week on Working Lunch for Financial Services when I talked about Product + Platform. Product in terms of features, functions and workloads (Sales, Service & Marketing). Equally Platform and extensibility is a key strength and perhaps one of our primary advantages. When we think about Platform we can consider the XRM and Application Rationalisation aspect:

  • XRM – Anything Relationship Management (Broker Management, Stakeholder and Regulator Management, Counterparty, Custodian etc)
  • Application Rationalisation – Although not an obvious use of CRM. It can be thought about as replacing existing legacy built applications by taking advantage of out-of-the-box features and components such as mobile, security, workflow etc.


“XRM” & “Application Rationalisation” is about building these extended relationship management systems or replacing legacy and disparate systems with applications that are quick and low cost to develop, easy to maintain and with no compromise on capability.


I find it quite interesting that we often begin projects at the bottom left (the arrow numbered 1). This typically involves features and functionality around sales force automation and business processes for Sales, Service and Marketing. As we  start the project we quickly realise the benefits that go beyond the traditional usage of CRM and we start to extend the application in other areas of the business, the most obvious of which are those areas of the business that have some form of relationship management (or XRM, X=Anything so Anything Relationship Management). In the diagram above I am using insurance as an example where we might also use CRM for Broker Management.

As we move further to the right we start to get deeper into the business and arguably into more complex or line of business areas (the arrow numbered 2). This is where we move away from what I would traditionally call XRM and I now refer to Application Rationslisation. This is because we are seeing organisations using Microsoft Dynamics to replace their existing legacy applications, rationalising their many different systems by using the Microsoft Dynamics platform to achieve this. In the example above we are seeing how organisation are surfacing their claims and or their pricing information directly in Microsoft Dynamics. Now, this has nothing to do with what we are used to referring to CRM so why would we build it in Microsoft Dynamics? Hopefully by the end of this post I’ll have been able to provide you with a few reasons as to why considering using Microsoft Dynamics to replace you existing legacy application can make a significant impact to your business.

A word of caution however, application rationaliation is rarely done in a big bang approach. These applications are often very complex in nature with inbuilt business logic that can be difficult to extract. I have seen many successful implementations that have taken an iterative approach (iterative is almost always better). Perhaps starting with surfacing the legacy application in CRM (so that the user has one less application to open). The user can take advantage of the native Microsoft Dynamics application and then any new features that may be required are then built in Microsoft Dynamics. This increases user adoption. As times goes by legacy features are either dropped because they are no longer used or they are rebuilt in Dynamics and the legacy application is fully replaced.

I’ve seen very few organisations go through the process of analyzing usage of their systems. Unused features are very rarely removed yet they are maintained and continue to have an overhead (and cost) on the overall architecture. This process of rationalising systems provides a great opportunity to not only improve the experience for the users but also reduce the costs over the long term.

A quick note on iterative development. Are you really iterative? Or have you taken a waterfall approach and split the project or features into chunks and called those chunks iterations? If iterative or agile development is not working in the way you expect (it takes time to get it right) then study or even better, hire an expert to help. Microsoft Dynamics can help you and your organisation become  more agile but you need to understand the core principals of agile and iterative development to really maximise the benefits.

Whenever the topic of XRM or Application Rationalsation comes up I’m always asked why do people use Microsoft Dynamics as a platform. Here are my top reasons:

  • Office based outlook and familiar interface
  • Drive User adoption
  • Increase Time to value
  • Risk Reduction
  • Reduce implementation and support costs
  • Multi- channel / multi device
  • Scalability & Security

And if you are looking for applications that you think might be a ripe to build in Microsoft Dynamics, consider the following:

  • Applications that involve some form of relationship and activity management
  • Applications that require multiple experiences across channels & devices
  • Applications that have had low user adoption
  • Applications that have been difficult to change (agility) and maintain
  • Where users are having to open to many disparate applications and want to reduce to a single point of entry

The concept of  Microsoft Dynamics CRM as a platform has been around for many years and in that time I have had the pleasure of building three products on the platform:

  • A Hedge Fund / Asset Management system (Investor Relations, Fund & Investor Flows, Investor Reporting, Nominee and Custodian relationships)
  • A Corporate Banking CRM system (Wallet Share, Research, Call Reports, Client Reporting, Account Planning, Client & Product On Boarding)
  • A Data Residency Solution (Data residing within geographic region such as Switzerland)

I can’t imagine building the above as a greenfield project and by choosing to use Microsoft Dynamics CRM I was able to very quickly focus my efforts on the business needs of my customers and potential customers rather than worrying about technology. I hope the slides below help you to understand the reasons why I chose to use Microsoft Dynamics CRM as a platform.

When thinking about Microsoft Dynamics CRM as a platform I think it is worth thinking about two primary cases:

  1. Extended relationship Management – building out the platform to provide functionality beyond traditional sales, marketing and services to all those parts of the business that manage relationships: Clients, Suppliers, Counterparties, Stakeholders, or anyone or anything that involves point to point interaction and communication.
  2. Application Rationalisation – replacing legacy systems that have been built greenfield or replacing complex Access databases, Excel spread sheets, Lotus Notes applications etc.

The Problem we are trying to solve


  • Expensive and slow development / release cycles
  • Too many disparate applications
  • Lack of a consistent framework and best practise
  • High business and project risk – compliance adherence
  • High developer dependency
  • Little or no security, redundancy, backup or version control
  • Data accuracy and auditability concerns
  • Scalability, performance limitations
  • Cost of training, development team and ongoing maintenance

The Microsoft Dynamics Solution


  • Reduce Costs – By rationalizing on a single platform and taking advance of the native features Microsoft Dynamics enables you to reduce hidden costs
  • Faster Rollout – With many features of out the box and an extensible point and click customization engine developers and business analytics can make complex line-of-business- applications without starting from scratch
  • Mitigate Risks – With less to build and complex non functional requirements already in place (infrastructure definition, redundancy, high availability strategies, etc) the development team can focus on business and functional needs and deliver of time
  • Enhanced Automation – the Microsoft Dynamics platforms provides rich automation features out of the box and is based on the well known Windows Workflow Foundation so that developers and business analysts can further automate your business
  • Integration – Microsoft Dynamics provides many integrations to other Microsoft products (Office, Outlook, SharePoint, Lync etc) it is based on Microsoft SQL server and the platform architecture and fully documented SDK provides complex integration capabilities with back office systems using Custom .NET plugins and web services
  • Native Features – Microsoft provides many benefits beyond traditional CRM features (Sales, Marketing, Support)  Platform capabilities such as Mobility, Social, Business Process Mgmt, Business Intelligence, Outlook/Office/Lync, Configuration, Extensibility, Role based Security, Auditing, Deployment, Scalability, Manageability, Data Cleansing, Upgrade means that you team can focus on the features that deliver the most value to your business.
  • Usability – Microsoft Dynamics provides a consistent well known user interface. And is immediately familiar to any Microsoft Office Users. Furthermore the platform allows users to access the system through many different method: Browser, Mobile, Tablet, Online, Offline, Outlook
  • Scalability – The Microsoft Dynamics platform has over 3M Users and over 33,000 customers. Technical whitepapers fully that document heavy usage and infrastructure requirements such as 100,000 concurrent users with sub second performance. The platform gives you proven high availability, redundancy, security  and backup strategies right out of the box.

Out of the box building blocks

xrm out-of-the-box modules

The slide above illustrates some of the modules, and capabilities that Microsoft Dynamics gives us. It is difficult to make this slide interesting but just imaging having to build all the items above from scratch! The problem with green field applications is that you never know what you or more accurately what your business users might need. Trying to incorporate all the possible permutations is going to result in an overly complex architecture and and application. If you are an advocate of the concept of Minimal Viable Product (MVP) then you are most definitely going to want to avoid doing this. This would result in a system that is going to be difficult to maintain, difficult to add features to and becomes outdated very quickly. Sound familiar?

A platform like Microsoft Dynamics can enable you to focus on the business needs and provide you with the supportive architecture and platform to deliver those needs to the users.

To underscore this from a technical perspective, let me show you are summary of what happens when you create a new entity (table) in CRM:

XRM ripple effect

Some XRM Examples


I hope that was helpful, I’ll probably come back to this again in a few months time. Please feel free to add comments below.

In other news I will be attending Tech Ready in Seattle this year. Tech Ready is a Microsoft internal only conference and I’m very excited to be going. I hope to be able to blog the experience here. I’m waiting for official permission, though due to the confidential nature of the content I won’t be able to share everything.

This posting is provided “AS IS” with no warranties, and confers no rights.

Next on Mark Margolis’s Blog: Product, Project and Day to Day Prioritisation