Upgrading from Dynamics AX to Dynamics 365 Finance and Operations is a looming (and exciting) reality for all businesses utilizing AX today. Mainstream support for even the most recent version of AX (2012 R3) is ending in 2021. Upgrading isn’t a simple process, but it will be well worth it, in the end, thanks to our four steps: the new features and functionality, modern user experience, integrated business operations, and enhanced business intelligence.
An enterprise software upgrade is a great time for a fresh start. No doubt at least some of your business processes have changed since your last upgrade, or maybe even since you initially implemented Dynamics AX. This is a great time to look to clean-up, roll additional business processes into Dynamics, utilize new tools, and leverage improved best practices for 2019 and beyond.
Step 1: Analysis and Scoping
The first step is to get organized with all of your business processes. At Stoneridge, we like to go through an exercise that we call the enterprise process review (EPR). The primary output of the enterprise process review activity is simply an overview of your key business processes and some documentation that describes each process and how it is performed today. This catalog becomes the foundation of the upgrade project and is key to understanding the work effort involved.
With all the improvements and additions that Microsoft has made in feature set and functionality, it would be good to take look at any business processes not currently utilizing Dynamics, as you may find benefits from bringing those into the Dynamics fold. More than likely, there’s some new functionality that you could leverage and just get more ROI and potentially eliminate other third-party systems that you’re currently using.
As you work your way through the business process analysis journey, you really want to look for the areas that your business stakeholders or your subject matter experts are indicating some inefficiencies, whether it be general complaints or some opportunities for improvement. The upgrade may be a very good time to dig in and resolve those issues.
Once you have your Process Library complete, we’ll cross-reference system changes between AX and Finance and Operations to determine what is new, what has changed that you were using, and if anything has been removed from the system. This is where having a knowledgeable partner to assist is a huge benefit as there isn’t one central place to compare features between AX and Finance and Operations.
Microsoft does provide a tool within the upgrade to identify depreciated features and, in some instances, changed features based on what it sees in your environment as you’re going through the upgrade analysis tool. This is fairly limited and should not be considered a replacement of a manual analysis of potential changes.
Lifecycle Services is a tool set that Microsoft Services provides that will be essential to your upgrade and to your life after the upgrade. As you are going through the business process analysis, I’d encourage you to check out Lifecycle Services and look at what they have provided in their business process modeler. Lifecycle Services is a nice tool set for you to organize your business processes.
The next major portion of the analysis and scoping face is a code review. At Stoneridge, we have built a tool to analyze custom code within your current system. We generate a report that lists out custom objects, models, layers, and ISV’s. Once that report is generated, we can assess if those customizations are still needed, if there are alternative options to replace customizations, and the best way to move any required customizations to Finance and Operations.
By comparing the customization report to the process library, it will be evident which customizations should move into Finance and Operations and which can be eliminated. For example, in the 2009 environment, you may have built a custom positive pay feature because it didn’t exist as native functionality when you implemented the product. However, in Finance and Operations, positive pay is now a native feature, so you may not need to update your code to the new system.
Additionally, you may determine that an ISV that you have is being replaced by native functionality and decide not to bring it forward. If there are ISV solutions that you want to continue utilizing, this is the time to communicate with them to ensure they have a version of their product that is compatible with Dynamics 365. At this time, the majority of ISVs have made their solutions compatible with Dynamics 365 or even enhanced their functionality.
Step 2: Cleanup
Microsoft has a tool in Lifecycle Services that will recommend data cleanup, including database size reduction. This tool will also highlight some SQL configurations and other compatibility challenges that you will want to make or change to optimize upgrade processing time.
You’ll also want to take a close look at the upgrade code analysis report. This step will give you a better understanding of the amount of work it will take to clean up code, which includes merging layers to get to a one-layer model as much as possible. You might be surprised to find where code exists depending on how tightly you conformed to best practices during any development effort performed in the past.
Finally, if you have some duplications or old data, this is a good time to do some purging and archiving. You may not want to carry forward volumes of data that you don’t need, from both the perspective of having a clean start but also because huge amounts of data can impact the processing time and overall time to complete the upgrade.
Step 3: Code and Data Upgrade
For AX 2009, the data upgrade that’s available is limited. From a technology standpoint, this means you’ll be using the data import/export framework to extract data from your AX 2009 environment into an Excel or CSV file format. That data is then imported into Dynamics 365 with the migration utility tool. The data import for AX 2009 is limited to entities such as customers and vendors. Transactional data is possible to import but not recommended.
There is no automatic code upgrade available from Microsoft if you are currently on AX 2009. The best strategy to upgrade code from AX 2009 to Finance and Operations is by first upgrading to AX 2012 and then upgrading to Finance and Operations.
AX 2012 users can upgrade their full data and code directly into Finance and Operations.
In Dynamics 365, Microsoft is taking a more agile approach to updates, so you’ll see updates released more frequently. Because of this, they’ve introduced a less intrusive customization approach that utilizes Extensions. This is an entirely new development architecture provided in D365. The previously available “Lift and Shift” upgrade approach is no longer an option, and all upgrades will require moving to the Extension model.
Step 4: Process Design and Testing
Next, I’d like to cover process design. So logically, you’ll get through the code and the data upgrades and then have a well-established environment before you get into process redesign or new feature implementation. However, you can get some of that started early and do some multi-threading of project work streams, especially if you’re leveraging any of the new features. If you’re taking a business process that isn’t currently being used or isn’t leveraging Dynamics AX and you want to roll that out, you can do some proof-of-concept as a separate thread from the code and data upgrade work effort that’s going on. You have access to a trial instance of Dynamics 365 so before you even get serious about doing the work, you can start doing some proof-of-concept and evaluating new features.
Lastly, I want to emphasize testing. With upgrades, there is a tendency to overlook testing and say “well, we’re just upgrading”. The reality is that a lot of the processes are going to be similar. However, I still want to encourage a process we use called Joint Process Design. During this process, you’re taking each of your processes, working through them, doing a proof-of-concept and hashing out any potential gaps or issues. You just don’t want to assume that everything is going to transfer exactly.
The Joint Process Design exercise is an effective testing and training activity, especially for the project team, but we do also encourage stand-alone testing where you build out your test scripts, use case scenarios and make sure to work through those thoroughly in the process of the upgrade.
After fully testing the system, you’re ready to deploy and go-live.
Contact Stoneridge Software for more information on the four steps to upgrade from Dynamics AX to Dynamics 365 for Finance and Operations or the Joint Process Design.