Microsoft Corporation

Microsoft BizTalk Server and Microsoft Dynamics: A Line of Business Management and Integration Solutions for the Extended Enterprise

Large organizations struggle to maintain a balance between centralization in order to control system and information complexity across the extended enterprise and decentralization in order to encourage flexibility and agility among local subsidiaries or divisions. Through deployment of Microsoft Dynamics™ and Microsoft^® BizTalk Server, enterprises can realize not only a simple, high-value solution that offers visibility, insight and control of information across the entire organization, but also the flexibility and agility that branch offices and subsidiaries require in order to innovate, grow, and compete effectively.

This white paper will be of interest to the business decision maker who is looking to find a robust, high value solution that provides cross-functional integration and coordination of line of business and supply chain management applications across the extended enterprise.



The information contained in this document represents the current view of Microsoft Corporation on the issues discussed as of the date of publication. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information presented after the date of publication.

This White Paper is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS DOCUMENT.

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© 2006 Microsoft Corporation. All rights reserved.

Microsoft, Microsoft BizTalk Server and Microsoft Dynamics are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries.

All other trademarks are property of their respective owners.

Contents

Introduction

In the past, these conflicting organizational needs have been poorly reconciled. While it is possible to integrate, unify and control information across various core business divisions such as financial services, operations, and human resources, the integration has primarily been accomplished through the deployment of monolithic software solutions that are often complex and costly. Moreover, it is all too common that the integration has been achieved at the cost of sacrificing agility and flexibility at the periphery of the organization. The alternative solution—seen in more decentralized organizations—has been to allow divisions and subsidiaries to deploy the software and system solutions that best meet their specific needs. While this enables divisions to retain agility and responsiveness in the face of their particular market demands, the drawback is limited visibility and insight across the organization as a whole—which, in the long run, can be very costly.

The necessity of managing resources across the extended enterprise raises specific challenges, including:

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  Lack of Integration. The larger the organization, the more challenging it is to connect systems, processes and people. Rapid growth or a business acquisition can transform a midsize organization into a large organization overnight. Without effective connectivity across departments, efficient work processes are compromised. Poorly integrated business processes and limited visibility into workflow are not only costly, but they have a considerable negative impact on organizational agility and competitiveness.
  
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  Outdated or Inflexible Integration Solutions. Most enterprise organizations already have an integration solution in place. These Enterprise Resource Planning (ERP) solutions, until very recently, have been monolithic, proprietary (non-standards based), and difficult to customize or add new functionality to in response to changing business needs.
  
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  Efficiency Tradeoffs in the Extended Enterprise. The argument for greater central control of branch and subsidiary resources is fairly clear—alignment of business goals can more readily be accomplished by standardizing business processes across the organization. Yet despite this, many organizations maintain decentralized business practices—and for good reason as well: customer needs are often better supported by local adaptation rather than central standardization. The net result, unfortunately, is that many large organizations have systems in place that were intended to be monolithic centralized systems but instead have been deployed in a decentralized fashion, reducing the level of integration and increasing costs—precisely what ERP systems were designed to control.
  

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  Inefficiencies beyond the Extended Enterprise Boundaries. Effective interactions both with trading partners and end-customers require a new approach. More and more large organizations are demanding that their supply chain partners be compliant with their own technology and regulatory needs. And end-customers are demanding a more seamless customer experience. Effective integration of both groups requires greater visibility into the key trading partner and customer service processes.
  

The Microsoft Solution for the Extended Enterprise

Microsoft® BizTalk Server, a business process management server, helps organizations efficiently connect people, processes, and information across the extended enterprise. BizTalk Server enables organizations to automate and optimize business processes, thereby helping to grow their business.

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  Real-time visibility across the extended organization: Microsoft Dynamics integrates and automates critical lines of business processes, providing organizations with a unified and integrated view of financials, operations and customer relationship management (CRM). Microsoft BizTalk Server not only extends that visibility across business units and the supply chain, but also provides real-time insight into critical business processes, helping businesses to respond to problems before they escalate.
  
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  Flexibility: The combination of Microsoft Dynamics and BizTalk enables companies to integrate and standardize where it serves business needs to do so. At the same time the combination serves to support flexible, adaptive business processes in those areas where it promotes competitive agility.
  
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  Efficient collaboration with trading partners: Using BizTalk Server to connect to your supply chain enables effective collaboration, without the need for trading partners to change or disrupt their key business applications in order to integrate.
  

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  Ease of deployment: Both Microsoft Dynamics and BizTalk Server fit easily into any organization’s existing infrastructure, simplifying deployment and delivering integrated applications out to branch offices and subsidiaries faster than other solutions.
  
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  Ease of use: Microsoft Dynamics and Microsoft BizTalk Sever work like commonly used Microsoft Office products that are already familiar to many organizations, eliminating the need for lengthy training and ensuring faster time to value.
  
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  Effective tools to gain business process insight: The combination of Microsoft Dynamics and BizTalk Server enables organizations to integrate and automate critical financial and CRM processes, not only throughout the central organization but also across the extended organization and the supply chain.
  

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  Increase ROI: Microsoft Dynamics and BizTalk Server not only integrate with existing organizational technologies, and with technologies in common use across the partner supply chain; they also leverage those technologies to provide deep business insights. The joint deployment provides a substantial return on investment because:
  
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    The technologies are easy to deploy, use and maintain, making additional expenses such as lengthy outside training unnecessary.
    
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    Integration of multiple business management solutions across the extended organization promotes the organizational flexibility and insight necessary to grow and compete more effectively.
    

Microsoft Dynamics

Microsoft BizTalk Server

Business Scenarios

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  To replace an outdated business management solution. Many of the older ERP solutions are very difficult to integrate, and, in those cases where the organization has deployed multiple ERP instances, difficult to consolidate. In addition, older ERP systems do not support the sophisticated real-time analytics that many of the more recent business management solutions support.
  
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  To integrate their current Microsoft Dynamics solution. Some Microsoft Dynamics customers are looking to integrate their business management solution across the branch offices or subsidiaries of the extended enterprise.
  
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  A less costly or complex business management solution. As previously mentioned, many large organizations have multiple ERP instances in which the same solution is deployed at both the central (hub) and branch office sites. For organizations that operate within the borders of a single country or regional area, the central site connects directly to multiple branch offices in a two-tier network. For larger or international organizations, a central site attaches to regional sites, which in turn connect to branch offices, forming a three-tier network. Many organizations that want an integration solution throughout the enterprise do not require highly complex and costly ERP solutions at the lower tiers, and instead seek business management solution alternatives that offer a better return on investment.
  

Figure 1. Two- and three-tier organizations.

Divisional or Branch Office Solution

CarboGen, part of the larger company Solutia Pharmaceuticals, is an award-winning example¹ of the effectiveness of BizTalk-Dynamics synergy. Although the parent company uses SAP as its ERP solution, CarboGen was looking for a business management solution that would support their mission of helping clients obtain pre-clinical and clinical batches of pharmaceutical ingredients as fast as possible. They needed a solution that integrated “islands of customized applications,” was easily customizable, and had lower maintenance and per user costs than the SAP solution. They selected a Microsoft Dynamics business management solution to provide customizable databases, customer order and tracking functionality, and sophisticated project management capabilities. BizTalk Server provided the integration backbone connecting the Microsoft Dynamics solution with the Solutia-wide CRM solution, allowing information to flow readily between the parent company and the CarboGen division. The combined result is a customizable solution that improved planning, project tracking, reporting, and divisional efficiencies. For the complete details, see the customer evidence at http://members.microsoft.com/CustomerEvidence/Search/EvidenceDetails.aspx?EvidenceID=2490&LanguageID=1.

Supply Chain

Microsoft Corporation, a worldwide leader in software, services and internet solutions, wanted to improve delivery speed and cut inventory costs for the production of Xbox360™. Managing its suppliers and its outsourced semiconductor manufacturing needs required an effective way to gain tight control over manufacturing, as well an easier way to bring on new contractors—neither of which was supported by its original system of electronic data interchange (EDI). The company decided to adopt its own Microsoft BizTalk Server, which provided a standards-based means of integrating shop floor manufacturing systems with its ERP application, as well supporting integration with its critical manufacturing planning system, its work-in-progress tracking and yield system, and Microsoft Dynamics. BizTalk also supported integration across the supply chain, increasing efficiencies and on-time deliveries. As a result, Microsoft expects to realize a significant reduction in inventory carrying costs. Go to the link below for full case study details. http://members.microsoft.com/CustomerEvidence/Search/EvidenceDetails.aspx?EvidenceID=13511&LanguageID=1.

Single Customer View

McKinstry Company, an engineering, mechanical construction and facilities management company in the Pacific Northwest, processed its different services in separate divisions throughout the region. While these separate divisions supported the ability to tailor projects to local customer needs, because each group used its own software applications to manage its business services, the result was a series of unconnected IT systems across the enterprise. These systems included division-specific customer databases, which, because they were not connected, failed to provide an integrated view of customers, resulting in duplicate sales efforts and lost sales opportunities. To address this problem, the company decided to implement the Microsoft CRM solution, which provides a sales tracking system that stores all customer information in a single location. To connect the disparate systems and software across the company, McKinstry chose Microsoft BizTalk Server, which also provides the rule-based messaging system to automatically and correctly route sales information throughout the organization. The net result of these deployments is increased workflow efficiencies, more sales opportunities, and decreased administrative costs. For full details of the case study, go to http://members.microsoft.com/CustomerEvidence/Search/EvidenceDetails.aspx?EvidenceID=4003&LanguageID=1.

Summary

Related Links

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  Microsoft BizTalk Server at http://www.microsoft.com/biztalk/default.mspx
  
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  Microsoft Dynamics at http://www.microsoft.com/dynamics/default.mspx