Kirill Tatarinov: Convergence 2009

ANNOUNCER: Ladies and gentlemen, please welcome General Manager, Microsoft Business Solutions Marketing, Chris Caren.

CHRIS CAREN: Good morning. Thank you, Dan, for that great intro, and good to have you here.

So good morning, everyone, my name is Chris Caren, and I am your host for the event. It’s great to have so many people here. On behalf of Microsoft, it’s great to be back in New Orleans as a company. This is our first major conference back in the city since Katrina in 2005, and yesterday, as a matter of fact, I made it out of downtown to a project that a lot of you volunteered with. We had about 400 people, customers, partners, Microsoft employees out in the Ninth Ward to do a day of community service working on some of the areas of New Orleans that are still recovering, working with Habitat for Humanity to build homes, put up siding. We gave some money on behalf of the event to the City of New Orleans. We had the Lieutenant Governor out to accept the check and give his thanks for our community work here. But it’s just amazing to see a city that went through so much hardship to be coming back so strong. And if you’re in downtown it’s sort of less apparent how much rebuilding has to happen still, but the city is definitely on the upswing, and on behalf of Microsoft, it’s great to be back here. It’s actually the first time Convergence has been in New Orleans, and we look forward to being back here in the years to come.

I mentioned the theme of sustainability, and the fact we had this volunteer project yesterday, which we’ll talk more about on Thursday, we’re also for the first time asking, not just for Microsoft, but for other corporations in the world, having a very environmentally friendly, low-impact event as all of us being here, everything from energy usage to traffic and things like that. There’s a lot more information on page four of your pamphlet outlining some details about the event, and how you can play your part to make this as environmentally friendly as possible.

If you actually look at the plastic cups that are used at the event, they’re not plastic, I figured out yesterday, they’re actually made of corn somehow. They’re not edible, but they work really well as a cup. So, we’re doing everything we can to minimize the impact of the event. And as part of us all being here, we’re giving about $7.5 million back to the community through a variety of revenue streams.

So we’ve about volunteerism, yes, it’s great. (Applause.) We talked about volunteerism, and today we kick off the event. We had some time yesterday with a lot of our partners, we have a few thousand partners in the audience as well. But today it’s all about our customers, and I wanted to just offer a few words of advice from talking to the people who have been to Convergence in years past about what makes it a valuable and most educational experience. One big theme was: Interact. So, do all you can to meet people you don’t know, colleagues in your industry, peers that might be using your product in different sort of industries or scenarios, talk with partners. It’s a great way to get feedback from Microsoft. We have several hundred people here from all aspects of the Dynamics organization. We’d love to get your feedback on product investments and product research, on how we can do better at doing business with you, and be more simple and easy to work with, and be a partner with. So, please do all you can to interact with people here that share some aspect of the work you do back in your organization.

We also do our best to make this the highest possible quality event. And although scores for this event tend to be high, in fact very high compared to a lot of Microsoft events, we’re still working to make it better and better. As Bob mentioned in the warm-up, we have evaluations online. Please, if you can, fill that out to give us feedback on how to make this event better. One person, one lucky person, will get a $5,000 prize for submitting their feedback, and for every person that completes their evaluation Microsoft gives $1 to the Boys and Girls Club of Southeast Louisiana. (Applause.)

So as far as the actual agenda, it’s a four-day event, as you well know. We have 10 track sessions in total, a few new tracks beyond the typical ones that cover products and learning from the field. One I’ll point out is called the business leadership track. The first time we’re doing this here in North America. We did it in Copenhagen a few months ago with great success and feedback. We have a number of notable business leaders in this track. I’ll point out two, but there’s all host of great presenters. Tom Kelly is CEO of a company called IDEO. IDEO is probably one of the most innovative companies out there that designs a whole host of great consumer and industrial products. Tom is going to talk to you about innovation in general, and how he helps advise companies on how to become more innovative.

Another speaker I’ll point out is a gentleman named Jeffrey Hollender, who is CEO of Seventh Generation. Seventh Generation, as you might know produces some environmentally friendly consumer products, but also is really best in class at running a very environmentally sustainable organization. They’ve used Dynamics NAV in a very unique way to better track and manage their carbon footprint, energy usage, and things like that.

So those are all great examples of some of the sessions in the business leadership keynote and there are more there, and more in the other nine track sessions as well.

The other thing I would ask you to do, again, looking for leveraging the feedback of past participants to make the event more valuable is really balance your focus on short-term learnings and needs that you want to take back to your organization to improve how you operate, and how you leverage our solutions with also some of the longer-term changes, impacts, bets you can make as a company to really transform the role of software in enabling your organization to head in the direction you want. So, think about short-term impacts, and things to take away to get quick value from the event, and think about long-term learning.

On that note, Thursday we come back here for our second keynote. Kevin Schofield is going to be joining us. Kevin is General Manager in Microsoft Research. He actually spoke a year ago, and even though we had Steve Ballmer here a year ago, Kevin actually blew Steve away on the scores on the quality of the presentation, on the value, and all the things that matter. So, we’re bringing Kevin back, and back to my point around long-term technology future, that’s what Kevin is going to focus on, the future of technology in business, hopefully give you some ideas on how to think about your organization not sort of next year, but three years and five years out. So, we’ll look forward to that keynote on Thursday morning.

I’m going to wrap myself right now, and just again thank you for taking the time out of your busy work schedule to come to New Orleans. It’s great to be back here in the city and see how much the city is rebuilding, and going back to where it was from years past. Do all you can to interact with your peers, with your partners, with Microsoft, engage in the track sessions, learn all you can, challenge yourself to take away as many learnings as possible, and most importantly enjoy the rest of the event.

With that, I will leave you, and enjoy the keynote this morning. Thank you.

ANNOUNCER: Ladies and gentlemen, please welcome Corporate Vice President, Microsoft Business Solutions, Kirill Tatarinov.

KIRILL TATARINOV: Well, good morning, everybody. Welcome to Convergence 2009. I’m very excited to be here with you and to be able to welcome you to New Orleans.

It’s been about a year since the last time we had a chance to talk to many of you. Lots of things happened in the year. The world seems like a completely different place today. But almost 7,000 of us came together for this event to talk, to connect, to reinstate our commitment to each other. And I think 7,000 people coming together in trying times like this in and of itself is a huge testament to this business, to our future success, and to our partnerships, and to our ability to work together.

Now, most of the folks in the room are our existing customers. And, first, I want to thank you for your confidence, I want to thank you for your commitment to Microsoft Dynamics, and I want to thank you for your continued support. If there’s one thing I want you to take way from this event, it is our commitment to your success. And if there is one thing I want you to bring back to your organizations, to your business, to your shareholders, is the knowledge that through Dynamics and through your choice of that technology, you’re much better positioned to endure and prevail in those trying economic times, to survive and to position yourself for the future, to embrace the change, and to win in this tough economic environment.

As we look around us, as we think about everything that’s happen, the change is the only constant. Lots of things are changing, the economy is changing, political environment is changing, technology, new innovations are coming into place, work force is undergoing dramatic change. There are so-called “Generation Y” people coming into the business, and they have completely different expectations of what type of technologies they want, and what type of business process they want you as business owners and business managers to deliver to them.

People quite naturally want to tune their business to the realities of the current macro economic conditions, and today those conditions are effectively forcing people to slow down, to think about cost cutting, to think about reducing. Very few people are able to zoom out of the current environment and look broadly and look outside and really position themselves for the future, position themselves for future success, position themselves for opportunity. And really what change creates is the opportunity. And that is very important for us to think about. And this is very important for us to be able to position ourselves to the future.

One politician recently said in Davos: Do not waste a good crisis. And as unorthodox as that may sound, there is a certain truth to that. The crisis that the economy is in today creates opportunity for our businesses. We all know those sacred cows that may exist in our businesses. We all know of the old arcane systems that may be running somewhere, and we just don’t want to touch it. We continue to band-aid it. We all know about some old business process which you just continue to cope with.

We have it ourselves, and we’re now taking opportunities to really go after those inefficiencies, and position ourselves for the future, position ourselves for success, and really drive forward, embrace this crisis, embrace the change, and turn it into the opportunity. And this is really why we picked up the Power of Possibilities as the tagline for this event. Opportunity creates the possibilities. And it’s really about the possibilities that change creates for us.

People very commonly fall into traps thinking that it’s just going to repeat, and today many people fall into a trap thinking that what we’re going through right now is going to end, and it’s going to go back to normal again. Well, folks, I don’t know how long it’s going to continue, and I think today nobody knows.

The consensus that I’m hearing from some analysts, as we had a chance to discuss here yesterday, is that it’s somewhere in the middle of 2010 when we’re going to see the beginning of the recovery process. But, when it comes back it is not going to be back to normal. It is going to be different, and today we’re living through a situation, we’re living through an environment that nobody has seen before. Nobody who is in the world of business has gone through what the world is going through right now. So, it’s never going to be back to normal. It is going to be different.

And by virtue of that being different, we need to position ourselves today for the different world that will emerge. And here today we want to talk about our commitment, and want to talk about the opportunity the current environment creates for us to work together, to embrace this change, to turn it into opportunity, to turn it into possibility, to endure, prevail, survive and thrive in this economic crisis and beyond.

To embrace the possibility and opportunity you need to actually turn your business into a dynamic state, into a dynamic environment. The word dynamic by itself has a number of interesting connotations to it. It’s a very special word. If you are describing a person, if you’re thinking of somebody and you were describing somebody who is a dynamic personality, you could probably think about somebody who is intelligent, energetic, aggressive, forceful, a leader, somebody who has a lot of charisma, and somebody who is prepared to deal with change.

You think about your business, as you think about your business and where you want your business to be, all those same characteristics really apply. And as the business owner at every level in your organization, you want to create environments, and you need to create environments that position ourselves for embracing change and positions your organization to be able to survive and thrive in this economy. And those dynamic qualities, enabling you to drive those dynamic qualities in your business, is our vision for Microsoft business applications. It’s also our commitment to you. Our strategy is to give you a set of tools, and give you technologies, methodologies, and solutions that will help you turn your business, make your businesses into dynamic businesses.

So when we think about core qualities, and core characteristics of the Dynamic Business, we have just to think about people, people who are the lifeblood of organizations. We think about process, business process that is the backbone of any organization, and we talk about ecosystems, we talk about the connectedness of the environment, the environment that we need to be all connected to.

So we can talk about all these qualities interdependently, and we can talk about thing that we together do to embrace people, process, and ecosystem, but it’s also about interconnecting those qualities, and interconnecting those ingredients, and driving them together in a very cohesive, integrated manner.

That’s what we’re going to talk about in the next 60 minutes or so. We’re going to talk about dynamic business, we’re going to talk about our vision to help you become dynamic businesses. And we’re going to talk about our commitment in the areas of people, in the areas of process, and in the areas of ecosystems.

I want to do it using some examples. And when we were thinking about dynamic business, and we’re thinking about qualities, and we’re thinking about context that would best articulate the dynamic business concept we wanted to find the customer, wanted to find the organization that is well in the state of becoming a dynamic business through the usage of technology, and through the usage of the processes. It was a pretty tough task to find a customer like that out of almost 3,000 who we have.

There are many, many terrific examples. But, we wanted to find somebody who is able to handle change during a state of emergency, who was able to embrace this change, would be able to continue to drive the business during the state of change and state of emergency. And we found one story that was truly compelling. That is the story of the American Red Cross. It’s a story that takes place right here in New Orleans during hurricane Katrina. And we’re going to follow this story throughout this speech, and throughout this keynote, and see how the American Red Cross organization was able to turn themselves into the dynamic business and survive and thrive in the state of emergency.

Let’s roll the video.

(Video segment.)

People, people are the lifeblood of any business. People drive business results, people generate business success. We as business leaders and managers, it’s our responsibility to empower our people, to enable our people to do more things, and to drive better results. We’re focusing their talents, we’re focusing their skills, focusing their knowledge, we’re focusing their well-being.

Most importantly, we need to focus on giving them modern tools that help them be more productive. We need to think of their role. We need to think of what roles they play in organizations, and how we can empower the roles that they’re playing to be more productive, and generate more results. Ultimately it’s all about productivity, and it’s all about empowering these people to be more productive.

If there’s one significant innovation that we were able to bring to the market in the last few years it is the role-tailored user experience. It is a user experience that tailors individual people in your organization, enabling them to do their job easily, giving them a familiar, simple, and intuitive user interface. Giving them experience that makes them want to use the software, as opposed to traditional systems that people really want to run away from.

Approximately 60 percent of the people who use computers in business run Microsoft Office every day, and by delivering software that is very familiar to them, by delivering software that looks like and plays just like Outlook, just like the rest of the Office environment, instantly allows them to look at business applications and start running it.

There are examples of people in the industry who basically take on technology, take on dynamic products with the role-tailored UI and start using them without ever having to open the book, without ever having to open the mail. And that’s effectively where the modern technology might go. We have a generation of people coming into the business who expect that simplicity, who expect that included user experience, and it’s our job to give them it, and it’s our job to give them that easy to use, intuitive user experience that they can embrace instantly, and they instantly raise their productivity and make them so much more productive.

I could talk for a long time about great innovations that we drove into our role-tailored experience and our user environment, but I thought it would be more appropriate for me to invite Errol and Jesper to join me here on stage, and to play a few roles for us, and to show us some very cool scenarios on how role-tailored experience leads in the organization and delivers great results.

Gentlemen.

JESPER LACHANCE: Good morning.

KIRILL TATARINOV: Good morning, Errol, Jesper.

JESPER LACHANCE: Thank you, Kirill.

Well, the role-tailored user experience is all about personal productivity, and to really showcase that we’ve created a scenario where I as a customer, Contoso, will be placing a purchase order at Errol’s Fabricam.

So right here I have my role center. It provides me with a great overview of what’s going on right now. I can even see the impact of the work that I’m doing. I can see that I have received a notification from Eduardo. Eduardo says, please get me 10 of these plus, well, some accessories.

So I can go ahead and click on this, and I’m taken directly to the entity, the item card where this notification was created. So, I can see that Eduardo wants solar panels, and actually without opening the replenishment “fast tab” I can see that the replenishment system is to purchase. So, I will go ahead and create a purchase order. So, I’ve forgotten all about the vendor number, and the vendor name, but “filter as you type” will help me find it anyway. So, I can just write E, and you can see the number is bold, but I can move this filter onto “post code, phone number, and contact,” and there’s where I find Errol. So, it’s that easy to find the vendor anyway.

Let me move on to the lines, I’ll add an item, and the item I was adding is the solar panel. Again, “filter as you type” helps me find the right item, and let me get 10 of these, that was what Eduardo wanted. So, I’ll just add the other items that he was talking about, five of these, and as you can see as I type in the item picker helps me find out that it is the right thing that I’m ordering, so five more of these.

So what I want to do now is I want to go ahead and release this sales order. And as you can see on my action pane up here, it has been grouped into the stages of my process. So, in this case we want to release. I’ll go ahead and do that.

KIRILL TATARINOV: The business process was presumably defined as part of the system set up, and it’s manifested itself in this tab on the top.

JESPER LACHANCE: Exactly, and it also helps new users coming in, because the process is mimicked right there on the action pane. So, Errol allows me to send my purchase orders electronically. So, I will go ahead and just click Send E-Purchase Order. And I’m now connecting to a service in the cloud, and once the connection has been established I’m sending off the purchase order.

KIRILL TATARINOV: This software plus service, the software is running on premises, and in the – it goes up, and then presumably to Errol.

JESPER LACHANCE: And then over to Errol, exactly. I get the vendor number in return, this way we have a reference for future talk.

KIRILL TATARINOV: Very good.

JESPER LACHANCE: Let’s see what happens at Fabricam.

KIRILL TATARINOV: Let’s go take a look at Fabricam.

ERROL SCHOENFISH: Good morning, Kirill.

KIRILL TATARINOV: Good morning, Errol. What do we have here?

ERROL SCHOENFISH: Today I’m going to play the part of a sales-order processing person here at Fabricam. And at Fabricam we’re increasing productivity by approving our sales order process time for the sales order process person, and then we’re also improving productivity for an executive. And I’ll show you a little bit about that. First of all you see that we did receive this order from Contoso, it’s a Web order that came in. So, what I used to do is manually send some approval documents around, in this case this particular document will invoke a credit limit approval process, with the simple  

KIRILL TATARINOV: As it should.

ERROL SCHOENFISH: As it should, yes, because it’s a fairly large order. So, with a simple click of a button I can submit an approval inside of my Microsoft Dynamics GP system, and then that will send off an approval process in the system. Now this particular approval needs an executive approval, so I was hoping that you could play that role for me today.

KIRILL TATARINOV: It depends on the amount.

ERROL SCHOENFISH: Well, I know that you’re here on stage, so you’re not at your computer, but we do have your phone here, and this is just a standard mobile device. And we have an application there that you can approve this on your mobile phone. It just takes a moment to come up, it’s going to retrieve the information. And really all you have to do is there’s a drop-down at the top.

KIRILL TATARINOV: For $20,000?

ERROL SCHOENFISH: Yes.

KIRILL TATARINOV: Do you folks really think I should do it?

ERROL SCHOENFISH: And then check the box, and do submit.

KIRILL TATARINOV: All right, $20,000, here we go, submit.

ERROL SCHOENFISH: And it’s as easy as that. So, that will then get back to me and we can finish the approval process. Now that’s a great footprint for when you’re on the go, but as an executive you also want to see some more information. And here we have an example of…let’s say you’re back at the hotel after a very hard day at Convergence, and you want to see some information. So, here we see the results of our improvement in our sales order processing time, along with the resulting customer satisfaction increase that happens as a result of that.

Now we know that you need to make key executive decisions, so we’ve given you the ability to drill down on information, so that you can see even more detailed information in your system. In fact, with a simple couple of clicks you can go all the way back to the Microsoft Dynamics GP system to see even more information. So, what we’ve done here is really improved productivity for both the sales order processing person, and an executive that’s on the go.

KIRILL TATARINOV: Very nice.

ERROL SCHOENFISH: And now that you’ve done the approval, we can see what’s happening back at Contoso.

KIRILL TATARINOV: Terrific, thank you, Errol.

ERROL SCHOENFISH: Thank you.

KIRILL TATARINOV: Excellent.

JESPER LACHANCE: Welcome to the Contoso warehouse. I don’t need a full computer in order to do my work.

KIRILL TATARINOV: Are you the house manager of sorts?

JESPER LACHANCE: Don’t I look like one?

KIRILL TATARINOV: Your role has changed?

JESPER LACHANCE: Completely, just like Superman, taking off the glasses and we don’t recognize him. So, in this case I have a mobile device, and that’s all I need in order to do my work. I can see items have been delivered, so I can  

KIRILL TATARINOV: That was quick.

JESPER LACHANCE: It’s very fast, those Fabricam guys, they know what to do.

KIRILL TATARINOV: They know what to do, yes.

JESPER LACHANCE: Exactly. So, what I can do is I can simply click “receive,” and what I will get here is a list of all my expected arrivals. So, basically if we just need to get it up on the screen. So, I have a list of all my expected arrivals, and if I go ahead and scan one of the items right here, the list filters, and I can see that the order coming in is actually from Fabricam. So, I’ll go ahead and select this one, and I can see that basically it consists of three different types of items. Let me go ahead and scan this one again. There we go. It says that it should be a quantity of five, and a quick look at that, it seems to be okay, five of those. I will scan the next type of item right here, and five of those, as well. That seems right. Let me go ahead and scan the last part. Oh man, 10 of these, let me take some time, let me just count. But, I can only get to nine, what about you Kirill? OK. I can only get to nine, so I will go ahead and  

KIRILL TATARINOV: Here’s the driver with the missing a box.

JESPER LACHANCE: Oh man, thanks a lot. So, I just received a new box. I will go ahead and see, I have posted the order already. Let me just get into my expected arrivals, the Fabricam order is still there, but let me see where this is going. This seems to be from the Fabricam order, as well. And the last scan of the day, let me just go ahead and do that, and now it says that expected quantity is one. And that’s correct. I will go ahead and register. I click menu and post. And basically I’ve posted my receipt, and we have supported the process without any paper trail.

So we think that we have shown how the role-tailored user experience is familiar. It’s simple, and it’s desirable.

KIRILL TATARINOV: Very good, Jesper.

JESPER LACHANCE: Thank you, Kirill.

KIRILL TATARINOV: Thank you very much, great demo. (Applause.)

What a great story and a demo.

(Video segment.)

It really emphasizes the value and advantages that role-tailored experience brings to our customers today. In fact, many of you already take advantage of role-tailored experience through the usage of our latest technologies. There are many more customers who are really successful and really drive very concrete, specific, tangible improvements in their productivity through that innovation. Look at this number, 50 percent less time on reporting, 60 percent faster order processing, doubling productivity. These are all real statistics that our customers generate and showed to us, and showed to all of you as the proof point of how this innovation works for them. It’s really amazing to these results.

Let me highlight one of those customers in particular, I thought it was a great, great story for a couple of reasons. So, Miles Kimball is the online catalogue vendor, and they have been in the catalogue business for a long time. In fact, they entered the business in 1933. They have about 500 people in their organization today. They exemplify the company that was able to embrace change, obviously moving just from the traditional print cataloguing to online cataloguing is something that they went through. And in the process, they really had very ambitious goals to almost triple the amount of revenue within five years, increase volume of transactions, and do that all without increasing their cost.

They obviously needed to manage operations in such a way that it was completely supported. Miles Kimball hired one of our great partners, Junction Solutions, who I’m sure is somewhere here in the room, and Junction is our partner in the retail industry. Junction brought Microsoft Dynamics AX to Miles Kimball. It expanded Dynamics AX with Junction software, a retail solution for multi-channel sales, and implemented with the customer. A great success story. You can see the terrific results that Miles Kimball was able to generate through their investment. I want to thank you Miles Kimball, who I hope is somewhere here, for testing our technologies, and for betting on our solutions. And I want to thank Junction Solutions for driving it to a successful implementation, and creating the phenomenal track record for one of our customers.

Focus, focus is the backbone of an organization. And if you put structure in place that enables us to drive disciplined, well-coordinated business, business that is truly buttoned down, business that truly enables us to drive compliance, and enables us to drive predictable innovation. At the same time, the business process as we implement it in our organizations must be really flexible. It must be really adaptable. If you think about the changes that we’re having to react to in today’s economic climate, we have to slow down, we have to accelerate, we have to fine tune, we have to rebuild some connections and some processes. And as we run our business process, flexibility and adaptability really becomes a key.

The time that it takes from the business decisions made at the CEO office to make it to the shop floor, and to make it to the store, and to make it to the airline counter – that time it takes for that decision to actually be implemented in the system is actually what differentiates good from great. In today’s economy, the time that it takes to implement the decision in your system also means survival. And sometimes, in some cases, when you’re just not able to fine tune your systems to implement and include changes in the pace that is required, you may not be around. That is why it is so important for business process to be adaptable and adaptive. That is why it is so important for business process to be flexible, that it is so important for business process to be integrated where you can connect different organizations within your company, where you can connect different disciplines, and different functions, professional services and sales to the systems developers, all of those functions need to work together and function.

It’s also about integration between IT and business process, something that’s largely as an industry there is still a lot of work for us to do. A truly flexible business process enables us to integrate and to come out of the box.

And last, but not least, in implementing adaptive business process, implementing business processes that would take you into the future, the feeling is to be focused on industry vertical, and micro vertical of your choice. And it’s the case where you want to be working with true professionals who understand your industry, and understand your vertical very, very deeply, and those people are our partners, many of whom are here in the room, partners to understand your verticals, and partners who are ready to help our customers embrace the business process and create the business process fine tuned for specific needs of the vertical and micro vertical way you run your operations.

Business process is one area where we have already implemented quite the wealth of capabilities across the products with our ERP products, across our portfolio. But we obviously are not stopping there. We’re continuing to invest very heavily in business process and ability to create adaptive and flexible business processes, effectively taking it to the next level.

So what I want to show you today, and I want to invite Lachlan to join me and help us do that, I want to show you something very innovative, I want to show you something that is still to come in the future. I want to show you something where we take advantage, and we essentially up-take the massive innovations that are happening in Microsoft outside of the world of Dynamics, but something that will ultimately bring enormous power to Dynamics products and to all of you as Dynamics customers.

Lachlan, let’s take a look at what you have here.

LACHLAN CASH: Good morning, Kirill. Good morning, everyone.

At Microsoft Dynamics, we’re committed to innovation. We’ve introduced role-tailored user interfaces to the business application, and we’ll continue to innovate on process adaptability. So, let’s have a look at a small example of how people can adapt processes.

Kirill, this is a Microsoft Surface device, it’s a multi-touch, multi-user device. We can both collaborate on it. And you’ll see here that we can start different applications that are loaded, and of course being a multi-touch device, we can interact through this in many different ways. I can interact with the applications using both my hands, and I can manipulate the images. We can both work at the same time.

But this is a business conference, how can we apply this technology to a business application? So let’s have a look at an example of that. So, this is my warehouse command center. It’s an application, and when you think of this device, it’s as kiosk type device, and if you think of a warehouse environment, where we have people walking around and they need to get information from the business application, so this application sits on the Surface device, and so potential a dirty, dusty environment, they don’t need to use the keyboard to interact.

Now I have my employee badge here, I can use that to actually sign on. It will authenticate me. I’m going to play Ellen.

KIRILL TATARINOV: Hello, Ellen.

LACHLAN CASH: I didn’t dress up today. So, what you see here is a top-down view of the warehouse, and I actually have a heat map. So, this is the business analytics information showing me the pick rates through the warehouse. Now I might have a campus-type facility. I can actually look at my production plans, for example, or my warehouse in my campus facility. This gives me the ability to actually view the assets that I have in terms of my warehouse management.

Now, it is a touch application, and you’ll see that I’m looking at the top-down projected view of the heat map of my warehouse, and you’ll see down the front here we have the picking space, and it’s largely warm, that’s where most of the orange is. But have an outlier right at the back here. And so what this means is that if I touch this bin, it will give me some information about the statistics of that bin. And what this really means for me as a warehouse manager is that my people need to actually walk backwards all the way up to the back of the warehouse during their picking day. Now, you’ll see this has a small capacity, and it means that I need to replenish it from the bulk area, which means that I probably need to do this a number of times during the day. So, it would make more sense if I actually moved this up to the staging area. I can simply drag this, and drop it into my staging area. And, of course, you’ll see here that this is the moves that are pending, so if I release these moves, this will go and update the business applications, and generate the relevant movement for us so that we can move that stock.

KIRILL TATARINOV: That’s great. That’s the Surface device front end and Dynamics backend running the actual processing.

LACHLAN CASH: Exactly. And so that’s the ability to give an intuitive user interface to the people in the business application. But what happens if the business changes, what happens if you, for example, you’re a distribution company, economic circumstances say, I should go into service and look at the profitability of our products, and provide after-sale service. How do we adapt the business application?

So let’s have a look at an example of how we might be able to do this.

KIRILL TATARINOV: What do we have here, Lachlan?

LACHLAN CASH: This is an HP Touch Smart device. Really the best thing about this one is that it’s running Windows 7, and you can see I’ve got some innovative ways to interact with the application that will give me some previews. I can work around. Traditionally, in business processes I might be working on diagramming my processes, and we might all have these in terms of diagrams, but this is the purchase process and of course we might have diagrammed it all the way through to the receiving process, so we can have, for example, the ability to look at my delivering. I have my verified process in terms of what happens.

KIRILL TATARINOV: This is a Visio diagram we’re looking at.

LACHLAN CASH: Exactly. It’s a standard process tool.

KIRILL TATARINOV: So I model my business process in Visio.

LACHLAN CASH: Exactly. So, that’s a static diagram tool, but we think we could make this a much more dynamic process. So, we’re working on, for example, a business process editor building on the foundation that we’ve introduced into our products in terms of the last release, in terms of workflow, for example. Now the really nice thing about Windows 7 is that it’s touch-enabled. You’ll see here that I have my overview of my processes, I can go in and modify my existing processes. I can see my operations. I can see my receiving. And I can see my verified products. If we’re going to introduce service, it’s going to change the receiving process when goods come in, for example, and I need to route them through service management.

So let’s have a look at the power. When someone comes in and we register to receive, I might want to notify service management, for example, and I might actually want to move this over to the service department.

KIRILL TATARINOV: Two extra steps introduced in the process.

LACHLAN CASH: Exactly. Now some of them could be physical, and of course this one is a notification after the receive is executed in the business app to actually notify the people in service management through the business applications. So, I can choose who is going to be notified. I can send it to Daniel, for example, our service technician. I can put conditions on this in terms of this might be actually a stock item or, of course, if it’s a service, it’s a sold item, for example. And I can escalate this if no one has actually picked it up after a certain amount of time. I assign this to Mary, our service manager, and I’m going to do it after potentially two to five hours. And then so once the configuration is actually done, we can actually activate this and put it back into the business application.

KIRILL TATARINOV: It goes back into the system.

LACHLAN CASH: Exactly. So, that’s what we’re doing in terms of looking at how we can really put adaptability in the business processes. Now, this is the sort of process change. Let’s look at the life of the service technician, and what he might have in terms of experience.

KIRILL TATARINOV: Right. You’re saying that he will see those changes?

LACHLAN CASH: Yes.

KIRILL TATARINOV: Wow.

LACHLAN CASH: So what you’ll see here is that we can go into the service management, now I might have a service object, it might be the tag, for example, that is riding along with the object here. So, I’m going to take this, I’m going to put it onto the device, and it’s going to register the service details from the business applications.

So you’ll see here, for example, that we have the service order details that I can look at. I have my service history, the details about what’s happened with that. I can have the diagram in terms of the schematic or the process of the item that I’m working on. But, you’ll see the specific process. I’ll have service, I have diagnose, I have repair, and then we’ll go to our close out.

So let’s go to our diagnostic page. So, you see here we’ve got our process. I need to do my checklist. Again, I’ve got my diagram that I can work with, but I can also do some more rich media. In this particular case I have a cab diagram that I can actually look at, drill into, and see more details about the specific part that I might need to repair, for example.

So we can check off the processes that we need to work what, and of course I can move to the next step. OK. And so this is, of course, the repair phase. We might, for example, need to look at some rich media, for example, about how this product is actually put together. I can look at my service orders. I can look at my schematics. So, we can look at, for example, the media, there’s actually a video, for example, that might actually put the product back. So, the service technician maybe just wants to play his music, but might want to use that to actually see what he needs to do to put it back together.

So that’s rich information that we can provide so that people can do their jobs, they can fix the item, for example, in a much quicker fashion, and get it back to the customer in a more efficient time.

So I’m going to complete the steps, and of course we go the service checkout. So, this will be where we can put in some details bout hat we’ve done. This is where we update the business applications. So, this is the job done. I can close out my jobs, for example, I can sign it off, and of course I can finalize it, which of course sends it back to the business application. So, a really small example of how –

KIRILL TATARINOV: Outstanding.

LACHLAN CASH: – we’re looking at visionary sort of technology that Microsoft has, and how we can use that to help people and adapt processes in the business applications.

KIRILL TATARINOV: Terrific, Lachlan. Thank you very much. What a great demo. (Applause.)

(Video segment.)

KIRILL TATARINOV: What a terrific story. In the demonstration, you basically saw how we’re binding the world of consumers and the world of business. This is a very exciting trend in general that we see happening in the high-tech world called consumerization of IT, where consumer technologies are coming into business and really pushing the envelope even farther.

This is a unique opportunity to Microsoft to bring both consumer experience and consumer innovation and business innovation. And by binding them together, we continue to push the envelope and will continue to innovate even more in automating business processes and bringing it all to the business.

Many of our customers take advantage of business process automation that we bring through Microsoft Dynamics today. Some examples that I want to highlight here: 40-percent cost reduction, 13-month return on investment, 20-percent cost reduction by implementing the product. All those are real statistics that many of our customers see today, and many of you experience in your organization.

There’s one specific example that I want to highlight and the one company that I want to talk about in a little more detail, a company called Network Equipment Technologies. They’re based in Fremont, California, and they were founded in 1983. They’re about 320 employees, and they’re providing network and exchange solutions for the government and for enterprise customers worldwide.

They used to run their business in Oracle, and that was the backbone of their processing. And they were in a situation where the system just didn’t scale to their increased needs and they were kind o hit from two different angles. On one end, they supplied to the government, and they were being continuously asked to increase the reporting capabilities and compliance that they need to present to the government on an ongoing basis. At the same time, they were going through tough times, and they needed to reduce cost and drive operational efficiency.

So what they really needed was a modern ERP system as the backbone for their operation. They worked with our part FullScope, who I know is here in the room. And FullScope helped them choose Dynamics AX and FullScope helped them implement Dynamics AX, replacing Oracle and JD Edwards, and effectively providing very solid backbone solutions that enabled them to meet the requirements of the government in terms of compliance and reporting, and at the same time meet all the stringent requirements and conditions on operational efficiencies and guidelines.

So thank you to FullScope, thank you to Network Equipment Technologies, great results, great success. They’re also a customer excellence award winner who’s being recognized here today, so Network Technologies, congratulations on your work and all the other award winners who are here in the room, congratulations to you also. (Applause.)

Full Dynamic business means you need to be running your business responsibly and in today’s world, being responsible and being environmentally responsible is increasingly important for all of us. It’s not by chance that we have this conference run as one of the first green events in this country, and we’ll continue to stay very committed and very focused on that.

This is why we’ve made an investment and today we’re announcing environmental sustainability dashboard for Dynamics AX, which is effectively add-on to Dynamics AX systems that brings on dashboard and ability for you to check your environmental footprint.

It aggregates information from different meter readers, from energy bills, and basically gives you a complete picture of CO2 footprint and carbon footprint that your organization brings to the world, which becomes increasingly important. And with governments across the world now requiring organizations to report on carbon footprints and to really control it and measure it in the statewide and ultimately worldwide basis.

So this is a case where we’re effectively leading the pack, we’re so much ahead of many others, creating technology and working with different regulatory bodies and different nonprofit organizations around the world, taking it to the next level and enabling organizations today to basically get on the path of being more environmentally responsible.

Now, in addition to that environmental sustainability dashboard in AX, we also have environmental sustainability theme surface in the Sure Stack. Methodologies through Sure Stack is available for Dynamics AX and AD and GT and it effectively enables you to become more environmentally sustainable through the usage of those products.

Ecosystem. In the world we live today, no business is an island. Everything connected and everything interconnected. Ten, 15 years ago, it was conceivable to find medium-sized organizations that would effectively be running in a stand-alone fashion within the boundaries of their own state or within the boundaries of their own little village. It’s not possible today.

Even the smallest manufacturing organization would be working with suppliers from elsewhere in the world, would be importing goods, will be importing material from places like Brazil, China, and so on and so forth. Which basically creates enormous demand for ecosystems being managed in a different and precedent way. Which creates a requirement for systems that surround those organizations be able to support this very vast, very broad ecosystem that span suppliers, vendors, customers and so on and so forth.

Making this ecosystem connected is a very important commitment from us to you, our customers. It’s also a very important quality of dynamic business. In our belief, you cannot be dynamic business without really taking care of the ecosystem and fully embracing it.

When I think about connected ecosystem, I really think about two things: Obviously, I think about cloud computing and I think about software plus services that enables you to connect software that you run on premises in your IT organization and the cloud and make it all work together. And through that, enable connections between myriad of communities that you have to deal with every day, whether it’s customer, whether it’s supplier, whether it’s vendor or whether it’s press, whether it’s government. Whoever it is you need to interact with, you can interact in real time through cloud computing through software plus services.

And the second thing that I think about when I think about well managed, coordinated, and connected ecosystems is customer relationship management tools. Products, that really help you manage the ecosystems that you live within, and Dynamics CRM is the prime example, the prime tool that enables you to really put your arms around ecosystem, to really put your arms around communities that you interact with.

If you think about the world today and if you think about the No. 1 thing that we all need to think about and care about, it’s the well-being of our existing customers. It’s understanding what our existing customers are doing, it’s understanding how they’re using our products, it’s understanding whether they’re getting the right level of service. It’s understanding whether there is additional opportunity for us to work with them.

That’s why Dynamics CRM is so important today. That’s why Dynamics CRM is being extensively used by many organizations around the world and being extensively looked at by many, even in difficult times like this.

I was talking to one of our partners leading to this event, and he called CRM technology recession-proof. Basically, CRM is what enables you to take care of your customers and there is nothing that’s more important than taking care of your customers in difficult times like this.

We have some very exciting announcements in the area of Dynamics CRM that we’re bringing to you today. First of all, we’re announcing an update to Dynamics CRM online that comes live this month. And this update brings a wealth of innovation, but most importantly, it addresses complicity, and it addresses times to value. It basically gives you and gives people in your organization ability to run online CRM systems with ease and take more advantage of the innovation that we bring to market.

I think it also exemplifies our commitment to ongoing innovation in that online service. We launched the service approximately a year ago and we’ve already updated it twice, responding to the needs of our customers and responding to the needs of our community in real time in the Internet time.

The second announcement that we’re making today in the area of CRM is we’re announcing a set of accelerators, effectively freely downloadable add-ons to Dynamics CRM systems that expands Dynamics CRM system capability, and effectively gives our customers more. I think that exemplifies, yet again, our commitment to our existing customers, where that ongoing innovation gives you more from your investment, and nothing can be more important today than that.

Also, the context of Dynamics CRM. I’m very excited today that EDS is now an HP company, and HP is a big, platinum sponsor of this event, so thank you, Hewlett Packard. EDS, an HP company, has expanded their commitment to Dynamics CRM, a commitment that they made over a year ago now, and now they’re going to be deploying and they’re going to be ready to deploy Dynamics CRM for their customers out of their data centers on a worldwide basis, which really stresses a core differentiator for Dynamics CRM, and that is power of choice.

You want to deploy Dynamics CRM in your own IT organization and run on premises? You can do it. In North America, you can use Dynamics CRM from our data centers, we’ll host it for you in a very cost effective, scalable fashion. And with EDS announcements and with almost 200 other partners who are ready to host Dynamics CRM with extensions for specific vertical industries that they may develop, we can do it too. And that power of choice is unrivaled in the industry, and that power of choice is truly unique to Dynamics CRM systems.

We will show you Dynamics CRM in a minute, and we’ll show you some very concrete example. And that example will be very different from what you’ve seen already. You’ve seen innovation in exiting products, you’ll see some breakthrough innovation with Surface and Windows 7, with this example, we’re really showing you how you take care of your existing customers today with technology that’s available today, a scenario that is very, very real, very, very live, and you can start using it right as you walk outside this room.

I will invite Reuben and show off Dynamics CRM. Reuben?

REUBEN KRIPPNER: Hi.

KIRILL TATARINOV: Welcome.

REUBEN KRIPPNER: Thank you. (Applause.) So good morning, all. I’m going to spend a few minutes today building on the message around ecosystem, managing that and growing that ecosystem. There’s no question that during these tough times, the ability to manage customer retention and boost customer retention is a high priority for all organizations.

So what we’re going to take you through today is how Microsoft Dynamics CRM can deliver on those objectives. What I’m going to show you leverages a number of our CRM solution accelerators. These are available to you today at no charge and you can download them and start using them.

So the scenario I’m going to run you through today involves a fictional company called Fabricam, they’re a manufacturer of IT hardware, and we’re about to manage an issue with Contoso, who’s one of our more valuable customers.

So Claire, who’s the IT manager at Contoso has been informed by her IT department that there’s a problem with one of the Fabricam servers, it just won’t power up. So, she obviously wants to get that issue resolved as quickly as possible.

Fabricam has provided for their customers a self-service portal which utilizes our e-service accelerator. So, that’s the starting point for our demonstration today. Claire’s going to log onto that portal and as you can see here, she’s got a number of options that she can work with. So, she can go in and she can actually modify her profile information, change her contact details and so on. She can also create and review any service cases that she needs to, however, her starting point today is she wants to search the knowledge base. If she can actually find the answer to her question herself, it’s going to be more efficient for everyone.

So she goes in to search the knowledge base. The model number of the server is JH-5,000 so she’s going to use that as her search stem. And it’s going to return a number of articles. So, the first one, obviously, involves Coca-Cola spillage, which obviously we can’t do much about. And the second one, the server is exploding on shut-down, which is not a good situation, but it doesn’t quite cover the scenario that she faces.

So what she decides is she’s going to create a new server case. So, she goes in here. She can put her title here. So, let’s say power-up problem with server. She can pick the relevant product, in this case the JH-5,000. The case type is obviously a problem, and she can put some notes in there as well.

So she goes ahead and creates that case. And effectively, that’s where that interaction concludes as far as Claire’s concerned. What actually happens from here is that I’m now in the persona of Harry Ellis, who’s a Liverpool football fan, but he actually is the account manager for Contoso.

KIRILL TATARINOV: Got a message.

REUBEN KRIPPNER: And he’s just got a message through IM. It’s informing him that there’s an urgent issue involving Contos, who’s a gold customer. So, as the account manager, he should be concerned and be able to help deal with that.

So he clicks on the link, and that then opens up the relevant case. He can see the information that Clare has actually filled in there, and also his eyes are drawn immediately to the product alert. That’s indicating that this particular product, the JH-5,000 is going out of mainstream support at the end of this year. So, that’s obviously noteworthy.

What he also wants to do is find some background information so he can help set expectations with Claire. So, he goes first of all into the case history and it’s quite clear that the number of cases around this particular product at Contoso are steadily increasing. There’s obviously too much Coca-Cola consumption in the server room, but apart from that, we’ll deal with it the best we can.

The next one that he goes into is the case load analysis. This enables us to compare the existing products with other products in that range and gives us a great deal of information. So, we can see, first of all, that we’ve got a high customer count for this server. We’ve also got a reasonably high service case rate and the average resolution time is four and a half hours. So, that’s great in terms of helping set expectations for Claire.

He then does a comparison with a couple of the other products and notes that the 6500 model has still a substantial customer base, has a much lower case load and also has a much lower resolution time. So, he’s now got a picture that’s starting to point out that, you know, here’s a cross-sell opportunity, let’s give Contoso the options around that.

He then wants to find out some more information and background on this particular server. So, he clicks within the chart. This actually launches an enterprise search, so it’s using our search accelerator.

KIRILL TATARINOV: Yes.

REUBEN KRIPPNER: This is based using SharePoint, and it brings back all kinds of contextual information about that product. So, there’s some technical brochures, some case references, some slide decks, and so on.

It also brings back some information from CRM. That is, we’re running a couple of events that showcase the capabilities of this new product. So, this is a great starting point to give Claire and Kintoso an idea on potentially planting the seeds for the cross-sell.

So he launches that, it launches the CRM campaign or event record in this case. He can find out the dates and so on. He can drill into the event details, find out the logistics, the registration count, and so forth. So, he thinks it’s a good idea to actually go and invite Claire to this particular event.

So all he has to do – there’s a pre-defined e-mail template as part of this campaign, as part of this event. So, he then launches that. It’s already personalized. All he needs to do is actually go and address that. He can then track that in CRM and send that off.

So Clare receives that invitation. That invitation has a link to a Web landing page where Claire can enter her registration details, and that’s then recorded directly in CRM.

What it also does behind the scenes is it actually creates a sales opportunity. So, what we’ve seen here today is how we’ve taken a customer service issue, how we’ve transferred that potentially into an opportunity, we’ve been able to manage the customer’s expectations in terms of repair time or service time, so it’s been a pretty good day for Harry Ellis. What he wants to conclude, though, with is just having a quick sort of status check in terms of how he’s performing.

So he goes and launches CRM. This takes him into his sales performance dashboard. Now, for anyone who’s in a sales organization, you’re definitely not competitive and you definitely don’t care where you stack in terms of the ranking, but this gives you that year-to-date information. So, he can see that he’s actually improving year to date. He’s now ranked No. 4, which is pretty good considering there’s five people in the team.

From a current pipeline perspective, he can actually see where he stacks up in terms of stages and opportunities and so forth. He can get a view of his top five deals for Q1, and he can also – more importantly, he can track how he’s performed year to date and how he’s tracking against the team average. So, in realistic terms, Harry’s pretty well placed.

So what we’ve sort of covered today is that, first of all, how CRM, Dynamics CRM can better manage customer service, how you can derive potential opportunities from that. During these tough times, there’s been – there’s no time where CRM has been more high value. Your ability to manage that process is vital, and this also fuels your ability to manage your ecosystem more effectively.

KIRILL TATARINOV: Very good.

REUBEN KRIPPNER: So with that, I’ll hand back to Kirill.

KIRILL TATARINOV: Thank you very much.

REUBEN KRIPPNER: Thank you. (Applause.)

(Video segment, ARC Ecosystem.)

KIRILL TATARINOV: What a great demo and a video. The most exciting thing about this demo, in my opinion, is this is something that you can start using today. With Dynamics CRM 4.0 and accelerators that we announced today, this is what’s available and this is a set of tools that can help you today with your existing customers and managing those relationships.

Many of our customers take full advantage of our innovation in the area of ecosystems and making this ecosystem more connected. Just look at some of the statistics: 30 percent decrease in call time, 40 percent savings in campaigns, 6 month ROI on implementing the system, pretty astounding statistics for business applications.

Let me highlight one of these customers in a little more detail. This is a company called Panel. They’re basically a medical laboratory, the area of medical testing for hospitals, clinics across seven different states. They have about 1300 employees and they provide specialized testing that hospitals can’t perform themselves.

Obviously, as you can imagine with hospitals being your customer, the requirements for customer service are paramount. And this was the case where Panel really struggles in that area. They had long response times, their employees who were supporting hospitals were frustrated because they had no idea what was going on, obviously management were unhappy.

They installed Dynamics CRM, which provided them a single database where they basically have a 360-degree view of their customers, of those hospitals, the response times, the delivery times, basically the health of the environment. And they’re now connected through Outlook and they’re able to drive that complete ecosystem of many hospitals across seven states being serviced by this laboratory. So, thank you for Panel of Spokane, Washington, our home state, for being such a great customer and such a great case study for how Dynamics CRM can bring such phenomenal results to a fairly significant organization. (Applause.)

We spent most of the last hour talking about the three qualities of dynamic business. we talked about process, the backbone of the organization, we talked about people, the life blood of every business. We talk about ecosystem, the fact that you cannot be driving your business in a disconnected fashion in today’s world. We talked about enhanced capabilities, productivity, connectedness and adaptability. And you saw many examples from our customers that are driving this innovation in their environment today, and you saw some great demonstrations and you saw some great videos demonstrating you how those three capabilities turned the businesses that you’ve seen into the dynamic state.

It’s very important also to think about the intersection of those three qualities and how we drive the intersection and integration of people, strategy, business process and ecosystem through the investments that we make in our products. Our mission in Microsoft is to give you a set of tools and give you solutions that will help you and help your organization become a dynamic business. With investments in Live ERP and CRM solutions, with investments in innovation, with investments in technology, that is technology that is backed up by a significant vendor with a significant commitment, you’re well on the path of coming the dynamic business.

We’ve seen an example of a business that is well on the way of becoming a Dynamic business, and you see how they are uptaking this technology and really driving it forward. And to me, this is probably one of the most dramatic examples that we could find.

So let’s take a look at the final video of how all of this came together for the Red Cross organization.

(Video Segment, ARC Conclusion.)

KIRILL TATARINOV: What an incredible achievement. Let’s give Red Cross a round of applause. (Applause.)

It is truly humbling to see one of our customers achieve this level of success. This is the story that I will always remember. I’m truly proud of being able to deliver this technology and this level for an organization like this.

We talked about our vision and we talked about people, process, and ecosystem being something that we drive. Our vision is truly helping people navigate through change in those turbulent times. And we talk about our commitment to helping your organizations become people ready and really take it up a notch and really connect the strategy, business process, ecosystem, make people more productive, how all of those aspects come together through a broad range of innovation that’s coming to you from Microsoft really enables you to become the dynamic business, really enables you to strive to endure and prevail in this current economic conditions, really enables you to be ready for a change, really enables you to change into the future and survive and strive as the economy starts to come back.

I want to emphasize our commitment to you, really want to emphasize our commitment to our portfolio of products. I want to emphasize our commitments to our partners who are here with you in the room who are probably sitting next to you. Our partners who are incredibly knowledgeable, our partners who understand your needs, who understand the needs of your vertical, and who are uniquely positioned to bring Microsoft innovation and Microsoft solutions into your organization.

Our commitment to strategy, our commitment to help you become the dynamic business is unwavering and unrivaled. We will stay the course, we will continue to innovate, we will continue to do our best to help you endure, prevail, and win. I am confident that you will out run your competition because you make the decision to run your business with Microsoft Dynamics.

I want to thank you for that, and I want to thank you for coming here and spending time with us in the next three days. I want to thank you for your commitment, and I want to thank you for your support. Enjoy the conference, have a terrific week. Feel free to e-mail me if you have any comments, feedback, questions, and thank you all very much.

(Applause.)

END