Choosing a suitable ERP solution is one of the most critical decisions any growing business must make. SAP B1 and Microsoft D365 are two of the most popular ERP systems for small to medium-sized businesses. Both ERP systems provide extensive functionality; however, there is a considerable amount of differentiation between SAP B1 and D365 based on the design of the ERP system, the potential for scalability, the deployment model used by the company (cloud vs on-premises), and the end-user’s experience when using the ERP system.
In this blog post, we will look at the comparison of SAP Business One vs Microsoft Dynamics 365 and point to key differences to help you make an informed decision as to which ERP system will be a better fit for your company.
What is SAP Business One and Microsoft Dynamics 365?
SAP B1 is an ERP software that was designed to cater particular needs of small and medium-sized enterprises. SAP B1 is an all-in-one business software that encompasses all essential business functions, including financials, inventory management, production, sales, and CRM (customer relationship management).
Microsoft Dynamics 365, specifically Microsoft’s Dynamics 365 Business Central, is Microsoft’s latest offering to the ERP down to mid-market businesses that provides both ERP functions as well as CRM functions, while being tightly integrated with the entire Microsoft tech stack, encompassing Office 365, Power BI and Azure.
When determining whether to go with SAP Business One vs Microsoft Dynamics 365, organizations need to take into account their anticipated long-term growth, the technology ecosystem they are currently using or plan on using in the near future, and how flexible they will be able to operate with respect to the operational processes within their company moving forward.
What are the differences between SAP Business One and Microsoft Dynamics
- Deployment and Cloud Capabilities
The primary difference between SAP Business One and Microsoft Dynamics 365 is in the way each solution can be deployed. SAP B1 allows for on-premise, hosted, or limited cloud deployment, and typically requires third-party providers for hosting in the cloud.
On the other hand, Microsoft Dynamics 365 was created to be a cloud-based service using the Microsoft Azure platform. As a true SaaS, Microsoft Dynamics 365 automatically updates regularly, is always accessible, and includes enterprise-level security with no need for any type of server maintenance.
For organizations focused on scalability through the use of cloud technology and who may have limited budgets for technology, Microsoft Dynamics 365 is likely a more attractive option versus SAP Business One.
- Scalability and Flexibility
SAP Business One is most suitable for smaller organizations with straightforward processes. However, as organizations grow or expand internationally, more difficulties may be encountered while customizing and scaling SAP Business One.
Microsoft Dynamics 365 was built to scale easily as an organization’s size grows. Organizations starting with Dynamics 365 can use Business Central first and add additional functionality such as Sales, Customer Service, and Supply Chain Management applications as they evolve and develop their ERP systems. This approach allows an organization to scale and advance their operations without the need to completely re-implement any of their current systems on a completely new platform.
- Integration and Ecosystem
SAP Business One is part of the SAP ecosystem and therefore may require additional connectors to enable integration with third-party systems.
Microsoft Dynamics 365 and Microsoft products (Excel, Outlook, Teams and Power BI) are natively integrated, thus enabling a seamless connection between the Microsoft environment and Dynamics 365. If your organization relies on Microsoft technologies heavily, Dynamics 365 is the better choice. Additionally, the Microsoft AppSource has thousands of extensions created specifically with reference to the requirements of your industry.
If your organization utilizes Microsoft technologies, Dynamics 365 has a clear advantage over SAP Business One for integration purposes.
- User Experience and Interface
SAP Business One has a very structured and logical user experience that has been developed to stay consistent and ensure reliability of the top-most possible standards. This is to enable standardized processes that can be supported through dedicated user training.
Microsoft Dynamics 365 has a modern-day user experience that includes a role-based dashboard and ai-based insights. Users will also recognize the Microsoft branding if your organization utilizes Microsoft technologies extensively, thus allowing for a faster and more efficient onboarding experience.
- Cost Structure and Licensing
SAP Business One’s costs incurred for implementation, licensing, and buildout of the infrastructure environment can be considered as upfront costs. There are also ongoing maintenance and upgrade costs associated with the total cost of ownership.
Microsoft Dynamics 365 has a subscription pricing model, which allows users to have a direct correlation between the features required and the number of users for Dynamics 365. The cloud-based solution allows organizations to achieve significant operational and maintenance cost savings.
- Industry Use Cases
SAP Business One is an ERP solution that is typically deployed by companies in the manufacturing, retailing and wholesaling industries where the organizations have a very strong requirement for basic ERP functionality.
Microsoft Dynamics 365 is used by a broad range of industries – professional services, distribution, manufacturing, e-commerce, digital transformation and digital analytics.
Making the right choice : SAP Business One vs Microsoft Dynamics 365
SAP Business One and Microsoft Dynamics 365 are both powerful ERP systems. However, the selection may vary based on your organization’s strategic objectives.
You should utilize SAP Business One if:
- You have well-established (stable) business processes as a small business.
- You prefer the SAP approach to ERP.
- You need strong on-premise functionality.
You should utilize Microsoft Dynamics 365 if:
- You want a cloud-first, scalable ERP.
- You utilize a large number of Microsoft tools.
- You are planning for future growth opportunities and digital innovation.
Having a firm understanding of the differences between SAP Business One and Microsoft Dynamics 365 will help guide you in selecting an ERP solution, which will allow you to grow your ERP solution both today and into the future.
