What does a Dynamics 365 implementation actually cost?

The reason nobody answers the price question is fair enough, really: the answer genuinely depends on things the supplier does not know yet. But “it depends” is a useless answer when you need to set a budget. So let us at least be specific about what it depends on.

Separate licensing from the project

Two entirely different costs get conflated:

• Licences are a recurring monthly cost per user, set by Microsoft. Predictable and easy to look up.
• The implementation is a one-off cost to make the system fit your business. That is the part that varies.

When somebody says “Dynamics 365 costs X per user”, they have told you nothing about what actually makes up the project budget.

The five cost drivers

1. Number of users, and how different they are

Fifty users doing the same job is simpler than fifteen users across five roles each with their own workflow. It is the variation in processes, not the headcount, that drives the work.

2. Integrations

This is the single largest line item in most projects. An integration with a modern system that has a documented API is manageable. An integration with an older system without one, where data has to be extracted by indirect means, can on its own cost more than the rest of the setup.

The ERP integration is nearly always the heaviest. Business Central is relatively straightforward because it is the same ecosystem. Other systems vary a great deal.

3. Data migration

Moving contacts and companies is easy. Moving ten years of history with attachments, relationships and activity logs, from a system four departments have each used differently, is another matter entirely.

4. Custom development

Standard functionality is cheap. Customisation is not. Every customisation costs twice: once to build, and then a little more each time the platform updates.

It pays to be strict here. The question “does the process have to work this way, or does it work this way because the old system required it?” often saves substantial sums.

5. Training and adoption

The line item cut first and regretted most. A well-built system nobody uses properly returns nothing. Treat this as a real part of the budget, not the remainder.

Realistic ranges

With everything above as a caveat – these are the orders of magnitude we see in Norwegian projects:

The ranges are deliberately wide. A project at the bottom of a range and one at the top of the same range are rarely the same project – the difference is almost always integrations and migration.

Where you can genuinely influence the price

• Phase it. Put one app live for one department first. Faster value, and a much better understanding of the requirements for the next phase.
• Defer integrations that are not urgent. Three months of manual export is often cheaper than building the integration before you know you need it.
• Migrate less history. Ask what you have actually looked up in the past two years. The answer is usually “not much”.
• Clean the data yourselves, early. See above.
• Challenge every customisation. Three in ten tend to disappear once somebody asks why.

The price of a project like this is not a mystery. It is the sum of choices that are mostly yours – and most of them can be made before you have signed anything at all.

David Kjell CEO & AI Solution Architect