Chapter 6

Dynamics 365 Implementation Process

In this chapter, we will highlight some of the important steps and phases of the Dynamics 365 Implementation process to help you better prepare yourself and your company for a successful deployment of Dynamics 365.

dynamics 365 implementation

Application Lifecycle Management

Regardless of its nature, everything has a life and its own lifecycle. The same applies to your solution. The application lifecycle management (ALM) represents everything there is to an application from the concept, moving through implementation, then continuous operation and at the end migrating to a new solution.

Your Dynamics 365 ALM process largely depends on whether you are implementing one or more of the Dynamics 365 applications, integrating with other solutions, and the customization.

Your implementation team must have the appropriate tools and resources to effectively manage all aspects of the solution including application governance, requirement management, configuration, application development, testing, deployment, and support.

So, whether you are new or seasonal to implementing the business applications, let us walk you through some of the processes of implementing Dynamics 365 business applications.

Before we get started, we want to highlight that this is not an official implementation guide of Dynamics 365 of Microsoft, Agile Dynamics Solutions, or any Microsoft Partner. This guide is for information purposes only and we shall not be held responsible nor liable for any damage or injury howsoever arising therefrom. We highly recommend you get in touch with a local certified Microsoft partner for more information.

Step #1: Project Initiation & Installation

The project initiation phase is the first phase within the project management life cycle, as it involves starting up a new project. Within the initiation phase, the business problem or opportunity is identified, a solution is defined, a project is formed, and a project team is appointed to build and deliver the solution to the customer.

A business case is created to define the problem or opportunity in detail and identify to prevent expensive mistakes further down during the implementation process.

“By failing to prepare, you are preparing to fail.” – Benjamin Franklin.

Phase #1: Solution Architecture Design

The first phase of step one is your vision of what you are looking for, where you are heading, and what problems you want to solve. When you understand what your business needs, only then you can find a solution to solve your problems.

Vision helps you to form a business strategy where your processes, data, and people are joined and solution strategy will help you address how using Dynamics 365 applications will help your business.

Solution architecture is about following a systematic approach that identifies your desired solution and the important elements needed to construct it. With a solution architecture vision, you will be able to transform your business vision into logical sections that will become a blueprint for building your solution.

Therefore, having a clearly defined vision will help you build your business strategy. Based on that you can outline your business processes and determine how your people are connected in and around your organization.

Understanding of how your data is currently utilized and how it supports your future vision. Planning your data strategy upfront also allows for better scalability.

From there you can develop your solution strategy and apply project management, change management, and governance and control methodologies. Remember, you are investing in the platform, not just the application.

Phase #2: Business Processes Mapping and Management

Modern business applications primarily improve inefficient processes by automating, optimizing, centralizing, and standardizing, allowing business solutions to become more scalable.

Your business processes are the main drivers to start defining the solution implemented in your project and every organization has unique ways of running its business.

And when implementing solutions like Dynamics 365 curating and utilizing these processes is important to keep sight of the basic truth of business requirements. When the project starts, putting the business process view of the organization at the core pays dividends.

Therefore, creating a vision of how a business is transformed through technology makes it is easier to focus on the activities needed to achieve that goal. This vision needs to include the understanding of how the business currently works and the state that it wants to reach after.

It is easier to find good opportunities to optimize your process using business process mapping. Remember, processes are the heart of every business, they show how a business operates.

But processes that work today may not remain competitive tomorrow. When reviewing your business processes, it is important to keep in mind how innovative technologies can improve process outcomes and collaboration.

Similarly, there may be multiple areas in your processes that would benefit from modern options now available. Technology is a key differentiator. Remember, chances are that your competitors may well be considering these options and looking to incorporate them.

Phase #3: Project Governance Model

All system implementation projects, including Dynamics 365 applications, need good project governance to succeed. This is crucial for the success of business application implementation as only having good software and technical knowledge is not sufficient.

project governance dynamics 365 during implementation

Implementing business applications and going through a digital transformation of your business needs significant and sustained participation from business users representing many different roles, disciplines, and skills. Many, if not most business participants, may not have previous experience implementing business application or business transformation projects, let alone Dynamics 365.

It requires s business users to gain sufficient knowledge of the standard capabilities of the Dynamics 365 application to better map their underlying business requirements to the out-of-the-box solution.

project governance dynamics 365 understanding and having clear purpose

Therefore, you should define the project governance model as early as possible, and certainly as part of the Initiate phase of the project, because it directly influences the project approach, oversight, resources, and project plan.

Phase #4: Data Strategy & Policies Planning

Having proper data strategy and policies planning is one of the most important steps in the implementation of your business application including Dynamics 365.

A good data strategy and policy planning is about understanding and giving the right balance of compliance and security, productivity, collaboration, isolation, performance, and maintainability.

A strategy to manage environment provisioning and access—and controlling resources within them—is key to:

  • Securing data and resource access
  • Organizing and structuring solution components
  • Governing and managing capacity

Imagine this as containers that store, manage, and share your organization’s data and other aspects such as data model, application metadata, process definitions, and the security constructs to control access to data and apps.

So, whether you manage a single or multiple-app environment to improve collaboration across teams your data strategy and policy will determine the way how others can access information.

data strategy and policy in dynamics 365 implementation

Defining your data strategy is crucial when implementing business applications and changing things can be very costly later in the lifecycle of the application. Wrong planning can create unnecessary data fragmentation and increase the complexity of your solutions. Early environment planning aligned to your organization’s digital roadmap is fundamental to success.

Step #2: Implementation Processes

Now, you will turn the strategies and plans you have prepared during step #1 into actions in order to accomplish successful implementation and achieve your strategic objectives and goals.

Phase #5: Data Management and Governance

Data are the most valuable asset of any business and also one of the biggest challenges as the amount of data being generated is growing exponentially and at least 2.5 quintillion bytes of data is produced every day.

However, with the right data, organizations can make informed decisions, improve customer engagement, and gather real-time information about products in the field.

And regardless of your role, data are part of your processes and day-to-day tasks, and knowing how you are using data, where you store them, how you are generating data, how do you access it and share it is essential for your Dynamics 365 implementation project.

Having the right data flowing in your business means you have set up a well-functioning business in which you have the most up-to-date and accurate information about your customers and products and can provide a superior experience to your staff and customers.

Having proper data governance, data integration, data security, and data quality are not just best practices; they are necessary for your business’s survival because every business wants to be data-driven and compete for customers’ attention.

Data management covers so many different areas, it is easy to get overwhelmed. By starting with the right people, process, and data, you cannot go wrong.

Phase #6: System Security

Security is another essential part of your system and it protects your IT asset against theft, damage of your hardware and software, or data and disruption of service.

Microsoft Dynamics 365 is a software as a service (SaaS) which means your data and application are all hosted on Microsoft servers and it is accessed over the internet.

In this deployment model (on the cloud), the customer maintains ownership of the data but shares application control with the provider. Therefore, security, compliance, privacy, and data protection are shared responsibilities between provider and customer.

shared resposibility mode for hosting application

Microsoft takes its commitment seriously to safeguard customers’ data, to protect their right to make decisions about that data, and to be transparent about what happens to that data and Microsoft apply these principles to your data as follows:

  • Security Implement strong security measures to safeguard your data.
  • Privacy Protect your right to control and make decisions about your data to help keep it private.
  • Compliance Manage your data in compliance with the law and help you meet your compliance needs.
  • Transparency, be transparent about Microsoft enterprise cloud services, and explain what they do with your data in clear, plain language.

Microsoft has been defending against threats and providing security protections for Microsoft online services since 1994, and they invest over $1 billion dollars per year to continue their commitment to protecting Microsoft customers.

For these reasons, you can place your trust in Microsoft’s expertise. This confidence allows you to focus on running your business. Ninety-five percent of Fortune 500 businesses run on the trusted Microsoft Cloud.

Microsoft Privacy: You are the owner of your data; Microsoft doesn’t mine your data for advertising. If you ever choose to end the service, you can take your data with you.

Microsoft Compliance: Microsoft is responsible for the platform, including the services it offers, and provides a cloud service that can meet or exceed the security, privacy, and compliance needs of your organization. Microsoft complies with data protection and privacy laws applicable to cloud services, and our compliance with world-class industry standards is verified. Detailed information about compliance for our cloud services and solutions that help organizations meet regulatory requirements for data security is available at our online Microsoft Trust Center.

Phase #7: Transform Data into Insights: Reporting & Analytics

As I said having a tremendous amount of data is a big challenge for companies. Manually creating valuable insights from large amounts of data is no longer doable and companies must shift from manual data mining and analyzing to moving to report using business intelligence.

Business intelligence solutions are vital for operations to manage ever-increasing data sources and transform the data into insight in near real-time. Your organization’s intelligence strategy should be based on a modern data estate, with a focus on how to strengthen the organization.

It comes without saying that the importance of data was never higher and for your company to effectively function, take smart and informed decisions, stay competitive, and deliver optimal business results you need to use your data as fast as possible.

As a part of the day-to-day usage of any application, users generate significant amounts of process-related and customer-related data— structured and unstructured.

Organizations are challenged by how to deal with ever-increasing amounts of data—and how to generate user value with it—especially when that data becomes siloed by the systems that generate or collect it.

Data silos make the goal of having a 360-degree view of each user even more challenging. Successful organizations can connect every facet of their business. Data from one system can be used to optimize the outcomes or processes within another.

Therefore, business intelligence, reporting, and analytics should be on top of your mind when implementing a new solution for your company.

Successful organizations will use data to empower their employees, intelligently engage their customers, transform their products and services, and optimize their operations.

However, due to budget, time, or skills constraints, some organizations decide to deliver a business solution as a first step, with a plan to improve insights and analytics capabilities at some point in the future.

Insights and analytics should be addressed in the early phases of a business solution, even if it doesn’t yet include all scenarios. Leaving these vital elements until later can affect the business and the user experience, eventually reducing adoption, increasing costs, and giving a negative perception of the value the solution has to offer.

Phase #8: Solution Testing

Testing your solution is a fundamental step during the implementation process of the Dynamics 365 application for your company to ensure it meets your business requirements, needs and ensure you can effectively operate your new system.

Performing your business processes during the test phase helps you to identify defects as early as possible in this process thus avoiding costly challenges that could delay the adoption, negatively influence users’ perception of the system, or users lose confidence in the new system thus affecting the change management process.

Therefore, having a properly planned and executed testing strategy will help you to increase adoption time, time to value and meet your expectations.

Remember, testing will help you confirm the effectiveness of the implementation team and the system. It helps you to answer a crucial question: “How to effectively operate your business with the new solution”.

It gives you the confidence that you and your team know what you are doing and what needs to be done. This helps build trust with shareholders and users for the system to help you run your operation.

Phase #9: Customization & Extension of Your Solution

Dynamics 365 applications offer a rich set of capabilities to help drive business value. However, each business is different regardless of the industry. Therefore, extending and customizing your solution will further help you achieve high ROI from your Dynamics 365 application.

Often complex business processes and requirements lead to highly advanced solutions with customizations and extensions to applications.

Therefore, extensibility and customization are very important to accommodate your organization or industry-specific business processes.

Microsoft Dynamics 365 Applications are made to use off-the-shelf solutions with embedded modern processes and further extend them. This tailors a solution to meet business needs, rather than having to build a custom solution from scratch with all the associated hassles and expenses to meet the precise requirements of your organization.

However, the organization needs to be aware of the impact when extending the solution. It’s important to strike the right balance between user experience, features requirement, and efficiency to achieve the right business value.

A key driver in the decision to extend is understanding the potential risks of extension to key solution characteristics, like its robustness, reliability, performance, usability, security, and ability to make updates.

Phase #10: Integration with 3rd Party

Dynamics 365 applications offer a rich and mature feature set across a wide variety of industries. However, if you need to extend your processes or incorporate data assets from other sources, then Dynamics 365 can easily be integrated with other Microsoft solutions as well as a myriad of third-party applications such as web portals, BI applications, and ERP systems.

Of course, like with other implementation phases, even integrating 3rd party tools with your Dynamics 365 solution requires some preparation.

Most importantly you should define business goals to ensure your integration work aligns with the overall direction of the business.

Organizations that integrate systems when building their business solution can achieve several key goals and benefits, including:

  • Increased productivity
  • Avoiding data silos
  • Reduced cost of operations
  • Reduced human errors
  • Process optimization
  • Process automation
  • Data centralization
  • Increased security
  • Regulatory compliance

Integration is one of the keys to ensuring you have access to your data and remove silos. It helps with reporting, visibility, and accessibility for the users.

With Microsoft cloud technology and Power Platform, low-code/no-code options, and the citizen developer concept, once the systems are integrated and the data is available in Dataverse, that journey can start without requiring massive investments upfront.

Step #3: Change Management

Change management is a crucial part of your implementation process when you are preparing the human aspects of using the system. Many people may resist changes, however, it is crucial to implement an effective change management plan for your company to avoid your employees falling back to old ways of doing business.

Remember, you have implemented your system for a reason to improve your business efficiencies and that comes with changes.

Phase #11: Prepare for Go-Live

This is the time everybody is waiting for and that is going live. But before that, an important phase is to prepare for go-live.

Preparing for going live is when all the parts of your Dynamics 365 Implementation project come together and are tested and validated to ensure everything works as expected, not just on their own, but as a whole.

Now, preparing the solution for successful deployment does not only includes the system being completed but includes a variety of activities such as training, preparing the production environment, conducting user acceptance testing (UAT), and all the other activities.

It is important to ensure you have training, adoption, and change management plans and know-how these plans contribute to the user experience and adoption of the new solution.

Remember, planning and preparing are key to avoiding delays that can impact the deployment execution.

Phase #12: Training Strategy

Training strategy is not only about teaching your employees how to use and navigate across the system but ultimately giving them the power they have been waiting for. Effective training strategies empower users to perform their tasks and give them confidence in the application and inspire a sense of delight when using the system effectively and correctly.

Dynamics 365 application training strategy should include some version of the following objectives. Many change management goals can also be addressed by ensuring that your training strategy clearly addresses these training-focused objectives:

  • Employees will gain the necessary knowledge required to use Dynamics 365 applications as a part of their day-to-day jobs safely and efficiently.
  • Training should be meaningful and not overwhelming, to provide users with an efficient way to do their jobs.
  • Training should help support business goals for the application (in other words, employees understand the “why” behind training materials and scenarios).
  • Training should be inclusive of everyone (for example, experienced users as well as new hires) so that all users of your application receive the education necessary to do their jobs.
  • Training should be an ongoing process that does not stop when the system goes live.

However, you should know Dynamics 365 is an ever-evolving and growing application. Because of this, training is an ongoing process that requires constant adaptation and updates. Therefore, effectively

Step #4: On-Going Support and Maintenance

Your responsibility doesn’t end once your solution is implemented. There is more than just implementing your solution. Let’s dive right in:

Phase #13: Servicing Your Solution

Now, despite your choice to implement Microsoft Dynamics 365 on-premises or in the cloud, you should do regular servicing of your application.

But you might be like, “hold on, isn’t Microsoft responsible for maintaining these environments?”.

And while this is true as Microsoft is responsible for maintaining the servers and their hardware, connection, security, and other aspects.

However, maintaining your Dynamics 365 solution is a lot like owning an apartment in a large building complex. The owner of the building is responsible for maintaining the building’s cleanliness, operation, lights, parking lot, gym, garden, and other common areas. However, it is your responsibility to keep your apartment in good condition such as working electric circuits, lights, plumbing, air-conditioning system, fridge, etc.

In a similar way, Microsoft, the owner of the software as a service (Saas) system, will be responsible for the platform—the building complex in our scenario. The customer is responsible for the upkeep of the health of their solution—the apartment.

Therefore, monitoring your solution and regularly servicing your solution is essential just like for your apartment or even for your car.

This applies to every solution you have, and not only Dynamics 365.

Phase #14: On-Going Support Mode

To ensure a good experience during the implementation of a project and after go-live, it’s important that you understand the different types of services that are available and how you can get the correct support for every scenario.

Microsoft tools and support help ensure the stability and effectiveness of your environment by providing infrastructure and application support. However, this support can be effective only if partners and clients correctly develop, test, configure, manage, and monitor the implemented system and its environments.

After the new Dynamics 365 system is live, there will continue to be a need for ongoing optimization of system use and productivity. There may be features in the Dynamics 365 system that the implementation and project teams decided to defer until after the system was live. Users may also find slightly different ways to utilize the system that help them be more productive.


Implementing a new ERP or CRM solution is a big project regardless you are a small or large enterprise, and many parties will be involved in this project.

Therefore, proper planning and preparation are crucial to successfully deploy business solutions for your organization.

Preparing yourself for ERP or CRM implementation can be a lengthy and difficult process for any company. But with the right methodology and strategy, you can see dramatic improvements in your business afterward.


This is not an official step-by-step implementation methodology used by Microsoft, Agile Dynamics Solutions, or any Microsoft Partner. It is for information purposes only to gain a general overview and understand how such a project can look like.

Dynamics 365 implementation project depends on many aspects, and you should consult with your Local Microsoft partner to get a better idea of how your project will be handled.

If you are considering Dynamics 365 as your ERP or CRM software and you are located in Malaysia kindly contact us.

Agile Dynamics Solutions is a leading Gold Microsoft Partner specializing in Microsoft Dynamics 365 ERP & CRM applications in Malaysia, Singapore, Cambodia, and other ASEAN countries. With 30+ years of experience, 100% implementation, and great customer service, ADS ensures your Dynamics 365 projects go live with confidence.

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Are you searching for a suitable ERP or CRM application for your business? Book a Dynamics 365 free demo with our experts to get a personalized approach for your business. We recommend the most suitable Microsoft Dynamics 365 applications based on your needs, help you to understand the licensing, and as well as provide guidance on deployment, implementation, and change management processes to go live with confidence. We are the leading Gold Microsoft partner helping businesses to digitally transform with Microsoft Dynamics 365 intelligent business applications.

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