Steve Ballmer and Kirill Tatarinov: Convergence 2011 Keynote

ANNOUNCER: Ladies and gentlemen, please welcome corporate vice president, Microsoft Business Solutions, Kirill Tatarinov. (Cheers, applause.)

KIRILL TATARINOV: Well, good morning, everybody. It is my great pleasure to welcome you to Atlanta, to Convergence 2011. This is our 15th Convergence and my fourth in my role as the leader of Microsoft Dynamics.

We have over 9,300 people here today. So, this is the second largest Convergence. So, we’re just a few folks short of being the biggest ever.

We represent here 20 different industries, coming from 36 different countries. Some people have to travel very near, coming from Atlanta. Over 500 people are Atlanta locals. Thank you for hosting us. And over 36 people from 16 companies came from as far as New Zealand. Thank you for taking the trip.

Whether it’s near or far, welcome to Convergence. We have an amazing show for you this week, and we’re very excited you are here with us.

This week, we’re celebrating a pretty substantial milestone for all of us who are involved with Microsoft Dynamics, the 10-year anniversary of Microsoft being the vendor delivering business applications to our business customers.

Ten years ago this month, we entered this business by acquiring Great Plains, and it’s an amazing road, and it’s an amazing journey that we’ve been on together with you.

Ten years ago, we had less than 30,000 customers working on Microsoft Dynamics GP. Today, we have over 350,000 customers, and 5 million users logging into Dynamics every morning. (Cheers, applause.)

Many of our customers are truly Dynamics customers for life, and here in the room over a thousand people have been working with Dynamics for over 10 years.

And at the show, at Convergence, we love telling the stories of our customers. We love telling the stories of how the products are used and how products make the businesses run and be more successful.

And I’d like to start the show to introduce a couple of customers, both are here today, who have been running Dynamics for over 10 years, and who have been with us on this amazing journey.

Let me start with a company called Black Box Network Services. They are the leader in communications and infrastructure products. They’ve been in business for over 35 years. And they started their journey with Dynamics 10 years ago by acquiring Dynamics SL. They got Dynamics SL for just 56 users back then, and they’ve stayed with Dynamics SL for portions of their organization.

In the last 10 years, Black Box went through an amazing transformation. The company grew double digit. The company has been cash-flow positive. The company acquired 46 different companies, and they’re now a substantial organization at a global scale, being the leader in what they do, not only in networking equipment but also in voice and communications.

During the journey, during this process, they also bought Dynamics GP for some other parts of their organization, and today, there’s a large group of people from Black Box here at Convergence looking at Dynamics AX and looking at the latest version of Dynamics AX to deploy it for the global part of their company.

As Black Box went through this journey, lots of things changed in their organization: new products, new organizations, new employees. One thing stayed constant. It is evolving Dynamics solutions that help them run their business, help them grow without incurring extra costs of supporting extra, additional employees, and continue to be successful and continue to drive those positive cash flows for their shareholders.

The second company that I want to highlight, and the second 10-year Dynamics user, is a company called NK Parts. They actually started as a subsidiary of a Japanese organization called Nippon Konpo that started in the ’50s as the distributor of automotive parts. And they started as a subsidiary, but then they grew with Nippon Konpo, and they’re now a global supply chain leader with offices all over the world, Latin America, still Japan, and the United States.

The logo of this company actually symbolizes the Japanese symbol for mother embracing child, and that’s the value that NKP as a company globally brings to their employees. They take care of their customers like mothers take care of their child.

NKP still has a strong presence in Japan, and obviously with the natural disaster that Japan has experienced last month, our thoughts and support go to NK Parts employees in Japan, and all of our partners and customers and business associates in Japan, as they recover from that natural disaster.

Ten years ago, NK Parts chose Dynamics NAV as the backbone for their operations. As Curt Lambert, the software coordinator from NK Parts, tell us, Dynamics NAV became the backbone for their innovation. Lots of things changed in their business, lots of new businesses were entered, lots of new offices opened around the world, and Dynamics NAV stayed with them, and the Dynamics NAV product evolved to support their evolving changes.

Through Dynamics NAV they were able to virtually eliminate all of the discrepancies from their inventory processes, and that has helped them to stay in business through the very hard economic situation, and continue to grow and continue to be very successful.

Our vision for business applications is what we call the Dynamic Business. The Dynamic Business is the one that does not stand still. The Dynamic Business is the one that succeeds in any environment. The Dynamic Business is the one that takes advantage of challenges and turns them into opportunities. The Dynamic Business is our commitment to you, our customers, and the Dynamic Business is what we strive to deliver with Microsoft Dynamics business applications.

We help you become Dynamic Businesses by maximizing productivity of your people. We’re making sure that people in your organization, the biggest assets that you have, have the most modern and the most elegant interfaces to work with.

We’re committed to you to make sure that your people, people in your organization run the software that they love, run the software that they come to work to use every day, and that is our commitment to you.

We’re making sure that you are becoming Dynamic Businesses, but helping you fine-tune your business processes, and making sure that your business processes stay in line with the changing business environment.

We’re helping you make sure that you stay ahead of the curve, and you continue to be the most competitive in your industry and in your vertical.

And we’re helping you to become a Dynamic Business by making sure that you can uptake all of the modern advances in communications and collaboration technologies to empower your ecosystem, to make it vibrant, to make sure that you’re connected, to make sure that everybody who you work with can interact with you in real time.

The Dynamic Business is our commitment to you, the Dynamic Business is our vision, and helping your people become more productive, giving you agile, flexible business processes and connecting your ecosystem are three promises from us to you in the world of business applications.

Now, to me as the leader of Microsoft Dynamics, Convergence is a very special event. This is an opportunity for us to come to you on an annual basis, and effectively report on what we’ve done to you in the last 12 months.

And looking back 12 months from Convergence 2010, I am truly proud of what we were able to do for you, and I’m truly proud of innovations, and I’m truly proud of great advancements that we were able to bring to the entire portfolio of our products, and serve our entire ecosystem of customers and partners.

Microsoft Dynamics AX for Retail became the first Dynamics-branded product for a special industry. We’re enabling retailers large and small around the world in 38 countries now to become dynamic retailers.

We delivered truly unique scenarios for our retail customers, connecting front office, connecting salespeople, connecting point-of-sale devices in stores with back office infrastructure, making that communication really wide and vibrant for the first time, and enabling retailers to embrace the changes driven by consumers that are, in fact, embracing new technologies, and in many cases outpacing retailers’ ability to cope with those changes.

Our commitment and our mission to our retail customers is to help them stay ahead of the curve, help them stay ahead of the technology advancements that come to consumers.

Dynamics NAV 2009 R2. Dynamics NAV remains one of the largest products in our portfolio, and in many geographies the largest product in our portfolio, and we have a very vibrant and growing group of Dynamics NAV customers.

Last December, ahead of schedule, we delivered an update to an already great product, really deepening capabilities in business intelligence and providing an enormous depth of report and analytics that customers can get from Dynamics NAV deployments.

This was also a release that took interoperability to a completely new level by connecting Dynamics NAV with a broad range of Microsoft products such as Dynamics CRM, but also connecting Dynamics NAV with the cloud, and enabling a new, broad set of scenarios for our existing and new Dynamics NAV customers, scenarios like online payment processes, scenarios like running Dynamics NAV from the partner-hosted cloud, and SaaSplaza is one of those successful partners who are now successfully hosting Dynamics NAV for any of our customers, taking advantage of application virtualization technology that is now part of the Dynamics NAV product.

Microsoft Dynamics CRM 2011 and Microsoft Dynamics CRM Online. In January, we launched what I consider seminal and historic product for CRM industry. The product takes sales force automation and customer scenarios to an unprecedented level of depth.

It is a known fact that sales force automation is typically viewed by salespeople as the jail they’re put into by their managers, and many people in the industry view traditional sales force automation technologies as a sales prevention tool.

With Dynamics CRM 2011 we’re essentially unlocking the productivity of salespeople, and not only are we empowering the sales managers to understand what’s going on in their sales organization and how can they manage their quotas and how can they manage their sales processes with much better efficiency, but we’re also empowering salespeople, and we’re giving them the tools that they love to use, and for the first time you have a sales professional who is empowered by the tools that helps organizations manage their sales processes at scale and with high precision.

And the same goes to customer care. With the deep customer care capabilities that come with the product, with customer care accelerators we provide capability that helps call centers and support organizations for companies of all sizes worldwide to run on this modern technology and be much more efficient.

And it’s worth noting that Microsoft, 100 percent of Microsoft, this year runs on Microsoft Dynamics CRM, and that is another testament of how the product is ready for a super global scale. (Applause.)

Microsoft Dynamics SL 2011. The product was made generally available just a couple of weeks ago, and we have a very loyal and very committed group of Dynamics SL customers and Dynamics SL partners, and it is our pleasure to bring this update to the Dynamics SL community, an update that takes full power of Microsoft Office 2010 to the Dynamics SL community, Project 2010, SharePoint 2010, Outlook 2010.

It’s also a release that brings a RoleTailored user experience to SL customers, and a very deep set of analytics. We’re very excited about this availability of Dynamics SL 2011.

And last but not least, Microsoft Dynamics GP 2010 R2. Many of you remember last year Microsoft Dynamics GP 2010 took Convergence 2010 by storm, and by far Dynamics GP has the largest install base here in the United States, and that install base and that customer population is growing.

And we’re very excited to bring to you Dynamics GP 2010 R2, an update to even greater depth of capabilities in the areas of business analytics, giving you the ability to analyze your data, giving you the ability to get even deeper insight into what’s going in your organization, and access it with ease through very simple interfaces and through very simple gadgets that can be placed on your desktop.

So, really this is an opportunity to bring Dynamics GP to everybody in your organization, to everybody in your company, to make sure that everybody in your organization can run this product and take full advantage of it.

That innovation across the Microsoft Dynamics portfolio followed the common blueprint and common direction that we set for the entire set of Dynamics products, for the entire lineup.

With every release, with every product, and every engineering group that is working hard to continue to bring you that innovation, the focus is on simplicity. We’re making sure that you get a business application that empowers your people. We’re making sure that you get a business application that is easy to use. We’re making sure that we give you a business application that provides deep insight to everybody in your organization, and we give you a business application that your people, people in your organization love to use. Simplicity is the most important brand differentiator for Microsoft Dynamics.

We continue to bring value, and with every release on every product in our portfolio the focus on making it easier for IT organizations to support those products.

We’re making sure that you can add more people, and you can scale out without incurring incremental costs. We’re making sure that you can add people to your organization without having to invest more in supporting those people. And the promise of value and our commitment, our brand promise of value in Dynamics, is unrivaled in the industry.

And agility is another very important attribute of what you’re getting from Microsoft Dynamics and what you expect to getting from us in the future, agility of innovation that we give to you, innovation that you can update with ease, but most importantly agility as an attribute of your organization and how we enable you to stay agile and stay ahead of the curve, continue to innovate, continue to fine-tune your business processes and stay ahead of the competition.

By delivering this broad range of products in our portfolio, we are able to empower companies, very different companies, to do an amazing thing. And by supporting this diverse portfolio of products, targeting many different industries, we can support different organizations with different scale, in different geographies, with different cultures and different regulations.

So, what I would like to do now is to show you some of those very diverse organizations and how they use Microsoft Dynamics in their own words. Patagonia is a very well-known supplier of clothing and equipment for outdoorsman. Hard Rock is a well-known brand in food and entertainment and rock memorabilia, with over 200 locations and great collections of Hard Rock memories around the world. And Amax is really a small organization with just a handful of people, who are yet delivering more than 200 million worth of products as a distributor of a global corporation, Stanley Bostitch, here in the United States, an organization that went through a very significant transformation as they spun off from the parent.

So, let’s hear from Patagonia, Amax and Hard Rock in their own words how they became dynamic, and how they can use innovation coming to them from Microsoft Dynamics.

(Video segment.)

(Applause.)

KIRILL TATARINOV: Amax deployed GP in under 12 weeks, and now everybody at Amax can run the product.

Hard Rock, three people supporting over 3 million in the audience, and they’re running Dynamics CRM, a kick-ass product for a kick-ass service.

And Patagonia, Patagonia continues the exciting experiment started by their founders 30 years ago, and continues to tweak and improve their business processes by running Dynamics AX as the backbone of their operation.

And Kim, Gary and Rose are here in the room here today. Let’s give them another applause. (Applause.)

Now, types of things we’re able to do with Dynamics, and types of innovations that we’re able to deliver across our portfolio of products, is enabled by everything that’s going on inside Microsoft, and by the entire power of innovation that is happening in the Microsoft stack.

Our advances in virtualization, based on server and applications, help Dynamics run at scale and help Dynamics run at scale on the desktop.

The advancements in the cloud and the advancement on Windows Azure is what enables us to take Dynamics into the cloud. And advancements in SQL Server and advancements in business intelligence is what enables us to bring those insightful technologies to you and help your people make faster and better decisions, and surface those scenarios through Microsoft Dynamics to you.

And it would be very fair to say that Microsoft Dynamics shines because these are ERP and CRM systems coming to you from Microsoft.

Now, ladies and gentlemen, it is my absolute pleasure to welcome onstage and bring to you Mr. Steve Ballmer, CEO of Microsoft. (Applause.)

STEVE BALLMER: Well, thanks to Kirill, and thanks to all of you. I really love the Convergence event. It brings together so many people who are focused on being stronger, better and faster than the competition, so their businesses can win and have real impact.

At Microsoft we come to work every day focused on creating products and services that do just that, that help you win.

As Kirill said, it was 10 years ago we made a bet. We said that if we are really going to do the most we can do as a company to help our customers get the most out of their technology investments and win, we need to be right at the heart of what makes businesses run, and that includes mission-critical business applications.

That original commitment led to the acquisition of Great Plains 10 years ago. When we got into the business, this market was highly, highly fragmented. Companies were using sort of groups of disparate, cobbled-together systems, or they were trapped in rigid business processes that were quite hard to change.

People have done some work on that as we approach the year 2000, but suffice it to say, the people who we spoke with, many of whom are actually here today, said, enough already, I need technology solutions that I can bet on for the long run.

And so to those of you in the room this morning who have been with us on this journey from the start, and to those of you who joined us along the way, I want to say thanks very much for 10 outstanding years. (Cheers, applause.)

Ten years is a long time. Imagine what it would be like to try to do business with the technology that we had 10 years ago. 2001, it used to be a Space Odyssey, now it feels like a lifetime ago.

Back in 2001, only about 50 percent of people in the United States had a cellphone, and it had one basic function, to make phone calls. The idea that the device you carry with you in your pocket would manage email, pictures, search the Internet, play music, log into the CRM system, seemed pretty far-fetched.

It was the era before social networks, when there was no such thing as YouTube or Facebook or MySpace or LinkedIn or Xbox LIVE or Twitter.

Ten years ago, transactions with customers and suppliers mainly happened still through fax machines. Business was conducted with a lot of paper.

In 2001, CRM and ERP systems were only really affordable to enterprises with significant IT resources, in a sense for the elite few.

But what is even more interesting than looking back is imagining how remarkable your businesses will be 10 years from now, given the technology advancements that we are seeing come into play and come to market.

Today, we’re in a position to deliver a range of devices and services that help you do business from anywhere, with anyone, and, of course, at any time.

We’re making a broad set of investments to do this. An important one of those is Microsoft Dynamics. And while some may see Microsoft Dynamics as some kind of stand-alone business unit, it’s really a very direct beneficiary of all the other areas of innovation from across Microsoft, as well as a key integration point for a number of technologies.

So, I want to take a moment to share what we’re doing in other areas of Microsoft, and then try to talk about what that may mean in the context of Dynamics.

Let’s start with devices. Through our deep partnerships with leading hardware designers we’re delivering a variety of experiences across an incredible range of devices. There are more than 1 billion Windows PCs in the hands of customers around the world today, and in January we announced that the next version of Windows will support system-on-chip architectures from Intel, AMD and ARM. So, whatever device that you use now or in the future, Windows will be there.

Windows Phones are changing what people expect from their Smartphone. Our early users tell us that they love it, and I’m certainly thrilled with the partnership that we’ve put in place with Nokia that will bring the Windows Phone experience to millions of users worldwide. So, it’s not surprise that both Gartner and IDC predict we’ll be the number two phone software vendor by 2015.

In entertainment we’re not only transforming the living room with Kinect and Xbox LIVE, we’re starting to bring the living room to you wherever you go as we begin to make games and content available on any device.

Last November, we introduced Kinect to the world, and two months later the Guinness Book of World Records named it the fastest-selling consumer device in history, 8 million sold in just 60 days.

The Kinect is basically a sensor for your Xbox that turns you, your body, your voice into the controller. If you jump, your on-screen character jumps. If you wave your hand, your movie selections will scroll by. No remote control, no training necessary.

Kinect is a result of many years of research in our labs, and while we’re currently using these kinds of advances for the entertainment world, we’re bringing this technology into businesses by connecting it, for example, to the Windows PC and the Windows Phone.

Next there’s our decision engine, Bing. I like to think of Bing as the “Little Engine that Could.” We keep on climbing as more and more and more and more and more people give it a shot. If it wasn’t so dark in here, I’d do an audience poll. Make Bing your default search engine today.

Since launch, market share in the U.S. is up considerably, up almost 50 percent. And the little engine should make a big impact in the way people use information, not just on the Internet but everywhere. In essence we’re building a mind reader that predicts what you’re trying to accomplish, and helps you get it done from whatever device you’re using.

In productivity Office 2010 is uniting the desktop, the phone and the browser, so that you can create, communicate and collaborate from anywhere.

Later this year, we’ll launch Office 365, which is the Microsoft Office cloud service. With Office 365 organizations of all sizes, from sole proprietor to hundreds of thousands, pay a monthly subscription fee to access enterprise-grade productivity software, including Office and SharePoint, Exchange, and our new real-time unified communications solution, Lync.

People tell us that using Lync instead of a traditional phone or videoconferencing solution is like going from AM radio to HDTV. It’s one rich experience that unites voice and IM, audio and video, and webconferencing.

As I see it, the cloud is probably the most important technological generation going forward for the next 10 years. By combining the scale of the Internet with the power of smart devices and the security of the enterprise datacenter, it’s an engine to drive growth and productivity for all of us.

The Microsoft Azure cloud platform is revolutionizing how we create, store, use information and computing resources. In the process it’s also changing how we use technology to understand the world and to act on the insights that we gain.

Make no mistake, when it comes to the cloud, Microsoft’s all in. Every one — every one of our products will be engineered to deliver the full benefits of the cloud. Every one, the whole Dynamics set, for example, will give customers the ability to instantly scale computing resources to the specific requirements of your business, and to open up new markets.

We announced a joint venture with Toyota last week to bring telematics from the cloud to Toyota owners in over 176 countries across the planet.

We’re connecting people and information across organizations, and we’re changing the way businesses analyze and act upon data.

So, what does all of this mean for you as Dynamics customers, and the software that you depend on to run your businesses? It means that the innovation that finds its way into Windows or Office or Kinect in Xbox or SQL Server and Bing will be applied to our Dynamics business applications.

As an example, just think about what we’ve done with Dynamics CRM. It doesn’t just work with Outlook, it’s in Outlook. Users tell us that the familiarity of how our ERP and CRM look and work, since it’s just like Office, is a major benefit. In fact, it’s very hard to tell where one stops and the other starts.

And we’re seeing new scenarios where customers can get even more value when Dynamics CRM Online, Office 365, Windows Azure and other cloud services are working together.

Then there’s business intelligence or BI. Historically, in this industry BI has been bolted on, and comes with extra cost and complexity. With Dynamics it’s a completely integral part of our business application.

The real beauty of all this lies not just in the way that we bring the full power of Microsoft innovation to you, but also in how we’re addressing the biggest challenges that companies have faced for decades, how to balance the benefits of technology against the cost and complexity traditionally involved with business applications.

Dynamics is different. Our mission is to transform complexity into simplicity. Our focus is on turning technology investments into tangible business value. And our goal is to give you agile solutions so that you can be dynamic: simplicity, value, and agility, to respond to changing business conditions, and seize opportunities at a pace not seen before.

A key part of delivering on this commitment is to deliver Dynamics in the cloud. We launched Dynamics CRM Online in January. It’s the first and only business application that lets you manage and migrate across the cloud and on-premises on your own terms. And the fact that we launched this release, the online offering before the on-premises version shows the promise we think that the cloud holds.

We know that some of you, some businesses want the cloud now, some later, and some may want a hybrid solution for quite a while. So, we created options and choices for you to deploy solutions in the cloud that can move on-premise, the other way around, or the option to use both.

In the three months since Dynamics CRM Online launched, we’ve seen already 40,000 trials. The level of interest is clear.

We also see lots of opportunities for the more than 27,000 customers and over 1.7 million total Dynamics CRM users today.

We believe that ERP and CRM should really be for everyone, not just the technology elite or the privileged few with deep pockets and big IT departments, but for companies of all sizes that are looking for simpler and more affordable ways to run their businesses.

Smaller companies want a competitive edge, too, and many large companies are very tired of the complexity and cost of their current legacy systems, and certainly the users are desirous of a simplicity that lets all of us access important business data.

I love hearing stories of how Microsoft products and services are helping businesses like those in this room make a real impact.

I’d like to talk a little bit about a customer who’s using Dynamics CRM Online, not just to transform their business but actually to help save people’s lives.

That company is BioMedix Vascular Solutions, and they developed a diagnostic device to detect peripheral vascular disease. It’s a condition that raises the risk of stroke or heart attack significantly for 10 million people in the United States alone. BioMedix also provides software to help monitor and manage individualized treatments.

Early detection of this disease makes a real difference, but today, only one in four people with the disease actually gets treatment.

John Romans, the CEO of the company, took over the business from his father-in-law. The business was struggling a little bit. They were getting pretty hustled and competed with by pretty fierce competitors. At the time, this testing was done only by vascular specialists. But John Romans oversaw the redesign of BioMedix’s testing hardware and software, and got their solutions into primary care clinics.

The results are astounding. In 2007, only 35,000 people were tested for peripheral artery disease. This year, they crossed the 300,000 mark in terms of people tested.

But their IT systems couldn’t keep up with that growth. So, John and his leadership team knew they needed a system that would scale and have the sophistication to manage the complex flow of data between primary care doctors, vascular specialists, and BioMedix itself. The solution had to be easy to use, and had to integrate with Outlook. The answer was a cloud-based solution built on Microsoft SharePoint Online, Exchange Online and Dynamics CRM Online.

Now, John and his team can focus on their core business rather than worrying about managing IT systems and wondering if they can scale. They have the potential to reach everyone who suffers from peripheral artery disease, and make a huge difference in the lives of literally millions of people.

A second great story comes to us from Hydra-Power Systems. They’re a leading manufacturer and distributor of custom hydraulic systems, based out of Portland, Oregon. Bob Jablonski is their operations manager. I’m told Bob’s here in the room today, and I’ll have a chance to see him later, but I think you’ll love his story.

According to Bob, their ERP system is simply the company’s brains, it’s their lifeblood. It runs all the processes the whole company uses every day. That’s why he’s been using Dynamics AX 2009 for a couple of years now.

But when Bob heard about the new reporting and analytics capabilities in Dynamics AX 2012, he jumped at the chance to be one of the 200 or so customers and partners to try AX 2012 early as part of our Technology Adoption Program.

Now, this is somewhat unbelievable but tells you a lot, Bob himself is doing the entire upgrade. He got the reporting services, the enterprise portal, and the data cubes up and running all by himself. (Cheers, applause.)

Now, I’m not recommending that all of you do an ERP upgrade all by yourself, but it tells you something. Dynamics AX 2012 is giving Hydra-Power the ability to easily integrate Web services, such as UPS and vendor invoicing. It automates manual tasks that used to take a lot of time. Bob will tell you that, because of the deep integration with SQL Server, with SharePoint and Office, that Dynamics AX 2012 is simple, it’s intuitive and it’s powerful. But, more importantly, more importantly, he’d say that it gives Hydra-Power the edge that only a really big company could have had in the past.

The timing couldn’t be better for Bob. During the last six months, business is really up. Hydra-Power is growing and hiring. And Dynamics AX 2012 makes training new employees much easier than ever before. In fact, before AX 2012, the only place they weren’t using Dynamics was on the shop floor. And now, Bob has touch screens down on the shop floor to facilitate real-time timekeeping. That greatly helps them with their costing, and he says that now his Dynamics ERP system really is for absolutely everybody at Hydra-Power but the janitors. That really is ERP for everyone. And I think maybe even someday we’ll have the capability that Bob will want to bring on line the janitors.

I’m excited to let you know that the same experience that Bob had in bringing to Hydra-Power is coming to all of you. Today, the public beta of Dynamics AX 2012 is available, and product general availability is set for August of this year. This new version of Dynamics AX is a game-changer. It’s ERP for everyone. It looks like and works with Office. It’s tailored to individual roles in your company. It makes it much simpler to model your organization visually, and to change your business processes quickly.

It brings powerful industry specific capabilities. It’s loaded with easy-to-use reporting and analytic tools, and built in BI that supports better insights and faster decision-making. And, as Bob can tell you, quick deployment and minimal user training means Dynamics AX 2012 truly delivers rapid time to value. This makes Dynamics AX 2012 a powerful foundation, I think, for business success.

The opportunities for your business to deliver new innovations, create new markets and reach new customers really have never been greater — no matter what industry you’re in — than you are today. And at Microsoft, our dedication to your success has never been sharper.

Simplicity, value, agility; simplicity, value, agility; let everybody use this stuff, give the kinds of value and insights that are transformational, and let you stay agile as a business. Those were the three words that Kirill and I really wanted to underscore for you today. But I think what’s really going to bring it to life, what’s really going to put the exclamation point on that, which will let you share our enthusiasm, and kind of wonder at what’s possible, is actually the most exciting part, I think, of this morning’s presentation, and that will actually be the demonstration of the product, to actually have a chance to see them in action. And I hope as you watch the demonstration here in just a second, you get a real sense of what’s possible, and of the kind of simplicity, value and agility we hope to bring to all of your businesses, and many, many more.

Thanks for you time this morning. Please enjoy the demonstrations. And, of course, thanks so much for your business. (Applause.)

KIRILL TATARINOV: Thank you, Steve. Thanks, everybody.

What we’re going to do now is to show you a real live example of a company that is in the business of manufacturing high-tech toys, and selling those toys through multiple channels, wholesale to major retailers. That company has just gone through a major transformation. They changed their organization. And I’m going to show you how that major change can be implemented in the system.

That company is growing, and they’re adding employees, and we’re going to show you how easy it is to add employees in the system. That company is selling products. We’re going to show you sales scenarios. And we’re going to show you a manufacturing scenario. And we’re going to show you how it all comes back together in the executive suite, and how business executives can see all the data, and can see the deepest insights in the business. What we’re going to show you is how Tailspin company becomes a true Dynamics business.

I’m going to have three of my colleagues join me on stage to help demonstrate how it all works together, Lachlan, Varun, and Caroline will be helping me show how this whole process falls through, and how Tailspin Toys becomes Dynamics. Let’s start with Lachlan, and let’s start with Exchange, and let’s start at the executive interface that CFO types can look at.

Lachlan, welcome on stage.

LACHLAN CASH: Thanks, Kirill.

So, everybody, this is Microsoft Dynamics AX 2012. The simplicity and agility comes from our continued work around RoleTailored interfaces. Someone like the CFO has that visibility into the information, and the control that they have to view what’s happening in the business. So, I have my relevant KPIs. Of course, I can drill into this. This is all based on the work that we’re doing around SQL Server, the SQL Server reporting services. I can see my business. We’re traditionally in wholesalers. Of course, we’re going into new groups in terms of direct materials, selling online and additional suppliers. So, I’ve got that visibility across the organization.

KIRILL TATARINOV: That’s what you have now. That’s what’s in the organization?

LACHLAN CASH: Exactly. So, visibility is one thing. But we need to be able to control the organization.

KIRILL TATARINOV: And change it.

LACHLAN CASH: Control and change.

So, what I have in Dynamics AX 2012 is the ability to visualize our organization structure, and have that related to our financial dimension structure, account structure, as transactions go through the system.

So, what I have here is one view. This is my HR organization view, so I can see my different departments, for example, relevant to my organization. I can see it relevant to, for example, a geographical view. So, I can look at, for example, my production, and then the different departments within production.

And if I see down the bottom, these are actually cost centers. So, this is related to departments and cost centers.

KIRILL TATARINOV: So, this is not just a picture, this is really the view of what’s going on in the business presented in a form that any executive can consume.

LACHLAN CASH: Exactly. And that’s the key thing. This is very related to the financial dimension structure.

So, for example, however I want to segment different parts of my financial information, this might be, for example, my administrative expenses. So, I could segment it based on my department cost center, and then all the way down to a vendor if I want reporting and visibility down to there. And I can also relate that organizational control down to the actual accounts, and how we control the account and transactions going through.

KIRILL TATARINOV: It’s got an amazing granularity here.

LACHLAN CASH: So, that’s the key thing, is that we have that visibility. We have that control, but we can also change it. So, I can see it’s based on my legal entity structure, for example, as well. So, I can see my legal relevance to my org. But, we can also go and see what I have here is my operational control. Those organizations we can use to control transactions going through the system, not just tracking my departments for analyst codes.

So, what I can see here is that I have, for example, a service reporting up to the org, but what I want to do is change it and report it up to my sales org. So, I can put that direct materials together with my sales  

KIRILL TATARINOV: So, the change has happened, now we want to make sure that the system supports this change and fully reflects the changing business reality.

LACHLAN CASH: Exactly. And so we want that control to happen here.

So, we’re going to go into edit mode. So, I’m going to click this into edit mode. All I need to do is simply cut. So, if I zoom here I’ve got the ability to cut that change here. And simply say, cut and then go over to my sales and marketing, because this is where I want to actually position this.

KIRILL TATARINOV: And of course, not everybody in the organization is able to do cut and paste on the entire financial structure of the system. There are permissions and security modes that are built into Dynamics AX 2012 that enable it to control, based on the individual roles in the company.

LACHLAN CASH: Exactly. So, what I’ve done is pasted that in there, and you’ll see that service, now, from a control perspective reports up to sales and marketing. So, from an all-over group perspective I can do that cost control.

KIRILL TATARINOV: And, again, it’s not just the feature change that you saw, all of the underlying models that are implemented in Dynamics AX 2012, and financial structures now have been updated.

LACHLAN CASH: Exactly. Now, we can use these organizational elements to control, this is a new concept in Dynamics AX 2012, in terms of policy. So, this is procurement policy. So, I can use my company structure and use that to control different policies around how we do procurement across the organization. So, it could be how we do requisitions, how they’re converted across. So, what we’ve done is actually implemented control. What happens, essentially when a new employee gets added? How can we use the organization relevant to control how the users interact with the system?

So, I can find David, David is a new sales rep for  

KIRILL TATARINOV: So, we recruited David. He’s coming on board. Now, we need to make sure that all of the things that David needs to do in our company are done for David in real time.

LACHLAN CASH: Exactly. Of course, we want to control how the user interacts with the system. So, you’ll see he’s an employee, but what I want to do  

KIRILL TATARINOV: That comes from just HR applications.

LACHLAN CASH: Exactly. What I notice here is that I can add roles. So, this is what we’ve done a major amount of work to simplify the setup and administration of the system, so that when people are being added we’ve got predefined roles out of the box, across our persona model. So, I can find  David is a new sales representative, I can simply add him to the system. So, he’s got that role now. He can act in the organization as that.

KIRILL TATARINOV: Now, everything that David needs from the ERP system is provisioned, and David is set up to be successful.

LACHLAN CASH: Right. So, when he logs on, he sees specifically what he needs to see. Now, we have a lot more granular control, because of that organizational structure. What I can do here is actually go in and say that he’s a sales representative, but I want to grant him access to only work in the U.S. organization. So, we have that granularity to use that organizational control to organize how the user behaves in that system, not only just what functionality he gets, but what actually he can do within the system.

So, I’ve simply granted him access to my U.S. organization, so he’s on-boarded. He has access to the system.

So, we’ve implemented change control. Now employees can use the system. So, of course, they can see the system through employee-based portals. And, of course, this is all the work that we’re doing around SharePoint, Web-based technology. Of course, someone like a sales rep might be on the road. So, they might use a device like this one. This is the new Windows Tablet-type device.

What I can, of course, because David is on the road, I can of course access my employee portal here, and I can see all the functions that I typically access when I’m out and about, like my expenses, my travel requisitions. So, of course, that’s the visibility that we have not only just to the executives in the organization, but down to the employees so they can interact with the system.

KIRILL TATARINOV: That’s great. That’s terrific. Terrific. Thank you, Lachlan.

So, you saw how the change in the organization  you saw pretty dramatic change in the organization was implemented in the system just in a matter of a few clicks. As most of you know, especially our partners who work with many different ERP systems out there, to make the change like this, in any other ERP product would require weeks and weeks of coding, testing and deployment. Here, it’s just a few clicks. And that portal that you saw, it comes straight out of the box. Normally to implement portals, self-service portals for employees, takes weeks and weeks of development. Here, it comes with the product, new employees get seamlessly added, get full access with all of the people, and get all of the information that they need to be successful.

So, now we’ll go to our second segment, and Varun is going to play the role of David the salesman, who just joined Tailspin Toys, and as salesmen are supposed to do, Varun is on the road trying to sell 500 helicopters, and he’s about to go to a major retailer and try to make his first sale ever.

All right, Varun.

VARUN KRISHNA: Thanks, Kirill.

As Kirill said, I’m new to the company. I want to impress my boss and close some deals. This morning, I’m meeting with one of our largest accounts, Wingtip Toys. They’re a large toy retail company based here in Atlanta, Georgia. And what we’re discussing with Wingtip is doing a Demo Days event in the store to promote a new toy helicopter that we’ve developed.

KIRILL TATARINOV: So, Demo Days is a tool that we gave this new sales rep, so he can convince retailers to buy those 500 helicopters. These are quite expensive items. It’s essentially marketing and promotion. Think of it as in-store promotion that can encourage retailers to deal with us.

VARUN KRISHNA: Absolutely. So, because I’m on the road this morning, I’m equipped with my Windows Phone 7, a device that allows me to be productive on the road. What I’m going to do now is actually open up an app that I downloaded from the Microsoft Dynamics Marketplace. This app is going to connect me to Microsoft Dynamics CRM Online, in the cloud, right here on the device. I have access to all of my key sales information, as well as settings, and synchronization capabilities in real time with Microsoft Dynamics CRM.

Now, today the task is actually pretty simple. All I need to do is actually submit a request for a Demo Days event for my manager to approve back at headquarters.

KIRILL TATARINOV: What you really need to do, my friend, is to sell 500 helicopters. Demo Days is just a means of getting there.

VARUN KRISHNA: That’s correct. Thank you for reminding me of that goal. So, really the task is quite simple. All I need to do is go ahead and update the request on the phone. I’m going to change the status reason in this case to submit it for approval, and then I save that. What that’s going to do is actually send that request back to my manager, who is back at headquarters.

Now, like millions of people every day, he starts his day in Microsoft Outlook. So, I’m going to switch roles now and we’ll have a look at what his day looks like. This is a real-time dashboard in Microsoft Dynamics CRM. It is embedded natively inside of the Outlook experience. It’s going to provide me with a 360-degree view of all my key sales information. Now, here in the upper right-hand corner I see that request from David, Wingtip Toys, from the device, delivered to me inside the dashboard.

With just one click I’m going to go into the actual request form. Now, here I have some information at my disposal, but I’m not sure if I want to approve this opportunity yet. David is a new sales guy. He’s out on the road. I want to make sure that he’s done his homework on this particular account before I decide to proceed.

With just one more click I’m now inside of the actual account form. Now, inside this experience I have a wealth of capabilities at my disposal. I also have actions that I can actually initiate on my own. Now, because I’m running Office 365, I have real-time instant messaging, collaboration, video chat capabilities, from within this experience. I can talk to David and find out how his trip went. Now, at the same time, I also have interactive, internal social capabilities. I can see what people in my company are actually saying about this particular account.

I’m also harnessing the power of the social realm, bringing in a real-time Twitter feed from Wingtip toys directly into this experience. And finally, I even have an income heat map distribution that gives me demographic data around the event, so I can determine if there’s going to be sufficient demand to actually have the event here.

So, Kirill, I think I’ve got  

KIRILL TATARINOV: So, it’s really the power of social and all the information, public information that’s available in the cloud, brought to you through Dynamics CRM, in the familiar Outlook experience, allowing you to get a true 360-degree view of everything that people know about that particular opportunity.

VARUN KRISHNA: That’s correct, Kirill, seamless integration that takes advantage of the cloud. I’ve gone ahead and approved this event, and now behind the scenes workflow in Microsoft Dynamics CRM is kicking in and managing these processes for me.

KIRILL TATARINOV: So, the system is set up to know that this approval is sufficient, and David on the road can proceed. There are other things that are happening, such as Web portal, that are automatically created, and many other things that may be required to be generated as a result of that approval, happen behind the scenes automatically.

VARUN KRISHNA: That’s correct. So, what we have here is actually our company website. We run it in Windows Azure. And what CRM has done is it’s actually updated a Bing map that we have on our website. So, customers around the country can actually come to our website. We’ll see that an event is now active in Atlanta. And they can actually just register for it to attend.

KIRILL TATARINOV: That’s great.

VARUN KRISHNA: So, let’s fast-forward a little bit. We’ve had  

KIRILL TATARINOV: How about selling those 500 helicopters?

VARUN KRISHNA: Right, I have the goal in mind. So, we’ve had the event. It was a great success. We were able to generate a lot of customer demand and to my delight, Wingtip is ready to place that order. I can actually take that order directly from the device itself again. In this particular case, I’m on my same device, I’m going to simply go back to the home screen here, flip over to my mobile sales dashboard, and take that sales order. So, I’m going to order in this case for Wingtip Toys the helicopter model that we’ve developed. So, in this particular case  

KIRILL TATARINOV: This is a high-end toy, which is going to Wingtip.

VARUN KRISHNA: Absolutely. So, I’m going to order in this case 500 devices. And the order is now in CRM.

KIRILL TATARINOV: So, the order is placed. It flows back to the CRM system. It gets registered. Now, CRM and ERP are connected in real time and that order gets automatically approved, assuming it’s set up to be approved. And it flows back into the ERP system that triggers our manufacturing processes, and triggers supply-chain decisions that the company would have to make.

Thank you, Varun.

VARUN KRISHNA: Thank you, sir.

KIRILL TATARINOV: Let’s go to manufacturing. Lachlan will show us what’s happening back at headquarters and how the manufacturing processes of the toys is going.

Lachlan.

LACHLAN CASH: Okay. So, this is a sales order. It’s come from CRM. It’s back in AX. What we can see here is that we can see the parts for the 500 pieces. And so what we wanted to see is we have visibility across not only just the sales, we saw the CFO, we have visibility there, but we have visibility down at the shop floor, the manufacturing sort of cycle. So, I can see my product, if I go up to plan here, I can have a look at my default order settings specifically for this helicopter.

Now, the default order type is Kanban. And what we’re doing in this release is allowing you to gradually implement concepts of lean manufacturing mixed with traditional discrete-based processing in the application. So, this is a revolutionary approach to how we’re giving you the ability to plan.

KIRILL TATARINOV: So, this is truly unique. No other product supports those mixed modes of manufacturing. That’s a key point here.

LACHLAN CASH: Exactly. And so what we’re giving you the ability to do is really decouple the supply and execution of how you manage your production cycle.

KIRILL TATARINOV: Excellent.

LACHLAN CASH: So, let me go into this sales order here and what we’re going to do is drill and so what I can do from the sales order, of course, is drill in to see the explosion, which gives me visibility of how this helicopter is going to be made. So, what I have here, of course, is this helicopter is going to be made with a lean approach. So, what we’re doing is allowing you to start to implement lean concepts for the products in your inventory that make sense in terms of what you’re offering.

Now, you’ll see that part of my bill of materials here is actually done with purchasing. So, the planning engine will be able to generate. We can generate planned orders, and we can do that. You’ll see it also generates the planned production order, because part of it is actually produced through a production cycle. And then, of course, we have different parts.

So, we have complete visibility, and we have the ability to have mixed modes. So, this is really where we have uniqueness. Now, what we’re also doing is providing visibility for the procurement people to collaborate with vendors and suppliers. So, what we’ve done is expanded our capabilities around, for example, requisition for quotes. So, this is one example where a procurement person could really collaborate with their supplier. So, what you’ll notice here is that I have a few requisitions here. Some are received, some are sent. And you’ll notice I have a send button up the top here. What this gives me the ability to do as a procurement person is simply put in my RFQs, and actually hit send.

Now, what’s unique is that we will generate an email for you. That email has a unique URL. At the time of sending, it will generate a page for the procurement person, and publish that out so that the vendor, when they come and logon, all they have to do is put in the details of what quote information they’re going to supply for that particular part.

And so, this is out on an Azure service. It’s generated on the fly as we generate those quotes. So, what traditionally would have happened is, the procurement person would have faxed orders 

KIRILL TATARINOV: That is really an example that Steve was talking about, of how traditionally people used to do those type of processes, lots of paper, lots of factors, or implementing highly customized, biz spoke, expensive systems that would support those type of EDI processes. Here, it’s out of the box.

LACHLAN CASH: Exactly.

KIRILL TATARINOV: It’s Dynamics AX sending email, interacting with Windows Azure, RFQ website is created automatically, and all of that flows seamlessly, integrating products with the cloud, and delivers what the customer needs.

LACHLAN CASH: Exactly. And this is all based on the services infrastructure work that we’ve done in Dynamics AX 2012.

So, what I can also do is attach documentation, for example, so the vendor is looking at the information that’s going to be very specific to what they want a quote on. Of course, they can create them with, you’ll see in I’m in Word, we have a new Office add-in capability in Word, so I can extract data and build documents in Word to get data out of business applications to build those.

Now, what the vendor will do is, of course, hit the submit button down at the bottom, and that’s all they need to do. What’s going to happen then, of course, is that will come back into Dynamics AX, and then I can simply compare replies. So, if I had a few different quotes go out to a few different suppliers, I have, of course, the ability to get that information back, and analyze it.

And so, of course, that’s essentially some visibility across the procurement, production and manufacturing cycle. We also have visibility down to the shop floor, for example. So this is, of course, the electronic Kanban board. Of course, those Kanbans that we generate in terms of production. I have the ability to see actually what’s happening, and I can manipulate that, as I might do if I’m on the shop floor.

KIRILL TATARINOV: So, of course, traditionally, those types of shop floor displays were just computer screens. In the last five years, with touch coming into the industry, we now see many of our manufacturing customers deploying those type of screen powered covered by Windows 7 on the shop floor. But that’s not where it ends. It continues, and the innovation that we’re bringing to the market with Kinect, would enable people on the shop floor, where routinely they cannot necessarily touch the display, they may have gloves, or they may have other restrictions that would prevent them from even touching a computer. And Kinect, as Steve said, is something that is now revolutionizing entertainment, and we expect it to revolutionize manufacturing and other business scenarios in a very similar fashion.

So, now you see Lachlan manipulating essentially the same screen that you saw on his computer with the Kinect controller connected to the PC, and manipulating user interface on the manufacturing floor.

LACHLAN CASH: And the key thing that you pointed out is that I might not want to touch the computer. So, if I’m on the shop floor, I can simply walk up to the board, interact with it, and simply by some gestures, I can get the information about what’s actually happening. So, if I see my different capacity, I might want to adjust different orders. So, by simply gesturing I can move periods, I can say that I’m a little over-capacity on, for example, on Monday, and so I might want to actually move that to Tuesday, and reschedule that.

Now, it’s going to take a nice photo of me, someone in a suit on the shop floor. The key thing, of course, is that you have the visibility of recognition. You can use that as an audit trail of who actually changed the data in the system. So, a small example of how we can innovate the work we’re doing with Microsoft Research, for example.

KIRILL TATARINOV: Thank you. Thank you very much, what a great demonstration. (Applause.)

So, you see the power of capabilities that we’re not bringing to everybody in ERP in the generic terms, but bringing to very specific industries highly tailored to the needs of those industries, and manufacturing being a prime example where we bring unique capabilities to our manufacturing companies, and we know that the manufacturing industry is represented here in the room at the most scale. I’m very excited that those capabilities are coming to you, and you are now able to do a lot more things with those technologies than you can do you with any other product in the market.

So, now back at the headquarters. Lots of things are happening in the business. Sales are going on. We’re manufacturing. All of the processes are going forward. And it generates lots and lots of data. And what typically happens when business executives get to the data, they’re drowned in lots of data that’s out there, and people very often don’t know what to do with it. Not anymore. Carolyn is here from our SQL Server team, and Carolyn is going to show us how we are going to make fun with data.

CAROLYN CHAU: That’s right.

KIRILL TATARINOV: And how data can be consumed in a very unique way.

CAROLYN CHAU: That’s right.

All right. So, I’m here to tell you today about Project “Crescent.” Project “Crescent” is about enabling anyone with just a Web browser to be able to access, explore and visualize data in meaningful ways. And when they find the insights that they’re looking for, they can go ahead and present those insights, and share them with others.

So, here I have Project “Crescent,” and you can see it’s running in the Web browser. And once I can show you this in the Web browser, I’m going to go ahead and F11 just so I get a little more space on the screen.

KIRILL TATARINOV: Now, remember, we’re starting with an empty screen. We’re starting with the white page. Let’s see where we get in just a few minutes.

CAROLYN CHAU: Okay. So, you can see, even though it’s a thin application, it’s got a very rich experience. I’ve got a Microsoft Office-looking ribbon on the top. And on the right-hand side is the Tailspin data that I have to work with. It’s the sales data, and I can look at it by product, and by population and region. And I’m going to go ahead and just start by typing in a quick title, Tailspin Toys. And to explore the data, all I have to do is start adding things that are in my browser.

The first thing I have to do is click on products, and the application is smart enough, as you can see, to tell me and select the most interesting thing about products, and I immediately get the information that I’m looking for. So, I’ve got product names, and images in the category, and I can go ahead and scroll down and just kind of preview my product.

Now, one of the core tenets of “Crescent” is the ability to transform the look of the data within a single click. So, right now, I have this nice table, but I can change the look of that data to this call-out card look just within a single click. I didn’t have to relay it out, or anything like that.

So, next I’m going to start breaking out my data by some of the dimensions that I’ve got. So, let’s take demographics first. These are the kind of users we have that purchase our toys, and I’m going to look at those by revenue. So, I’ve got my different demographics by revenue. And, again, a single click to transform the look of data. I’m going to change that to a column chart. And, voila, I have a column chart.

Next, I’m going to look at categories, and go ahead and break out the quantity of my data by category. Go ahead and click. And select category. Again, I can just make it a little bit bigger, everything shows up as a little table. I can verify the data. And then I can change it to just the bar chart by clicking there.

That’s a pretty good couple of clicks?

KIRILL TATARINOV: That’s pretty cool. Is it all live?

CAROLYN CHAU: Oh, he’s taken the punch line. Okay. So, right behind the scenes, right, we understand the data that’s in the system, and automatically I get interactivity. So, if I want to look at Trainers, I can go ahead and click on that product category, and I get the contribution that tells me that most of my Trainer purchases are made by my intermediate category users. If I click on intermediate, I can see what kind of products that they buy, and then the collective pitch is our new product line, I can click on that, and see that it is only sold right now to our professional users. That’s exactly what we planned for now.

KIRILL TATARINOV: That’s great. So, all those models that are defined in Dynamics flow seamlessly into SQL and provide those BI capabilities in real life.

CAROLYN CHAU: Exactly.

Next, let’s go ahead and compare the category sales by quantity and revenue, and to do that I’m going to change this to a bubble chart. And I need a couple more measures, so I’m going to add revenue so I can compare it to my quantities. And then, I’m going to add the number of products. And that’s going to give me the size of the bubbles. And let’s go ahead and add some data labels so we know what we’re looking at.

All right. So, just a couple of clicks, and I can see that Trainers, there are five of those products, and we sell a lot of them, but we don’t make a lot of revenue off of them. The Collected Kits, which is our new product line, we have the greatest revenue generation for, even though we don’t sell as many of them.

All right. So, what do you think we should do next?

KIRILL TATARINOV: Let’s see what happens over time?

CAROLYN CHAU: Let’s see what happens over time. Time is a great dimension, right. So, let’s go ahead and add month, and you can see that the application knows that charting something over time means I want to see it over time, and I want to put that in lots of different slices and views. Okay, shall we play this thing?

KIRILL TATARINOV: Yes, let’s see what happens.

CAROLYN CHAU: All right. So, when I play it what we’re going to do is look for the bouncing balls. We’re going to look for jumps in sales, because of the different initiatives that we’ve put in place. So, let’s go ahead and play it. And you can see it’s kind of small, so I can pop it out and get a nice bigger view of it.

And the first thing that’s going to happen is the holidays are going to come up, and I’m going to see a jump in Trainer, those are my holiday sales going up, and the next thing we did was a reorganization, right. We changed our sales organization around our new product line Collected Kits, and there is a sales jump from that. Pretty cool, huh?

KIRILL TATARINOV: That’s quite amazing.

CAROLYN CHAU: Yes, all right.

KIRILL TATARINOV: Isn’t this amazing. (Cheers and applause.)

CAROLYN CHAU: So, I can even track over time what’s happening by clicking on the different bubbles. And I can see the different trails of that data.

KIRILL TATARINOV: So, this is training data that we can now use in our future planning?

CAROLYN CHAU: Exactly. All right, so let’s go ahead and pop that back in, and you can see when I pop it back in, it keeps the context of the interactivity that I did while it’s popped up. So, I didn’t lose any of that context.

All right. The next thing I’m going to show you is, Project “Crescent” another one of its core tenets is the ability to navigate a lot of data at once. And we do that by enabling a couple of different views, and one of them is called this banding view. And a banding view allows me, in this case, to look at each of the individual products, and information about those products.

So, let’s go ahead and add some reason data, and I’ll add the reason name, and the match, and then down here I’m going to go ahead and in just revenue. All right. So, on the right-hand side I have information about all of my products. But, on the left-hand side I have information about my individual products. And I can go ahead and navigate those and see those change as I navigate.

So, it’s really the great ability to see different slices of data at different levels of granularity. And when I get a report that I really like, what do I want to do with it? I want to tell the story of that data, and I want to do that through presenting it. So, I can go ahead and do full screen.

KIRILL TATARINOV: And that’s a report that you can take to the boards, to meetings, on your Windows Tablet, and show it off to people.

CAROLYN CHAU: Right. And then I can really go ahead and tell the story of the data. I can walk them through, show them the changes interactively, I can play the data over time. See the different trends, all of that is still enabled while I’m in presentation mode.

KIRILL TATARINOV: That is truly amazing. Who would have thought that data, and manipulating data, can be so much fun.

Thank you, Carolyn. Thank you, our demoers.

(Applause.)

Thank you, guys, amazing demonstration, amazing technology, thank you very much.

So, in just a few minutes, in just a few minutes you saw how we implemented change, how we drove sales, how we implemented very dynamic marketing scenarios. You saw a manufacturing floor, and you showed amazing ways to manipulate data and to make data fun, data manipulation that comes to you with the next version of Microsoft SQL Server, integrated with the next version of Microsoft Dynamics, and truly unleashing all the data for business professionals.

What you also saw in this demonstration is the cloud. I didn’t stress it during the demo, but the cloud was all over that demo. And cloud is truly a very exciting, very important transformation that we’re experiencing. Cloud powered by Internet, and cloud that transforms the business of consumers and the world of business.

Microsoft has the most experience in the cloud, with many different technologies that we had in the cloud for many, many years, technologies like Windows Update, that daily patches billions of devices, technologies like MSN and many, many other tools and products, and approaches that we had in the cloud. In the demo, you saw Office 365. In this demo you saw Dynamics CRM Online. In this demo you saw Windows Azure working together with Microsoft Dynamics AX.

The question that often comes up, as it relates to the cloud, are you Microsoft going to put Dynamics ERP, core ERP, in the cloud? And if you are going to do it, when are you going to do it, and how are you going to do it? And this is a very important point, because a business application to us is not just a tool, it’s not just technology, it’s not just the product; business applications is the entire ecosystem.

We deliberately depend on our partners, our partners who help us bring those products to you, our partners who help us service and customize and fine-tune those products, our partners who deliver very important and very unique customizations, and additions for specific verticals in very unique geographies.

We deliberately depend on this ecosystem, and whatever we do, we bring the ecosystem with us. And as it relates to Dynamics ERP, it is hugely important for us to take the entire ERP ecosystem into the cloud. And that is a unique approach. No one else in the industry has taken this approach, and that approach is making our strategies, and our approach to ERP truly unique.

And today, I’m very proud to announce the next generation of Microsoft Dynamics ERP technologies will be available in the cloud. And, not only that, but the entire ecosystem, everybody who works with you and brings to you all those customizations, and all of the changes that you make in the Dynamics ERP system today will work in the cloud when Microsoft Dynamics ERP is available in the cloud. And we’re able to do that, and we’re able to drive this amazing innovation that technically, of course, you understand is very, very complex. We are only able to do it by being able to access an amazing innovation coming to us from Windows Azure, from SQL Azure and Office 365.

So, Microsoft Dynamics ERP Online is essentially surfacing the power of the proven cloud platform that would enable that at scale, innovation in the cloud for all of our customers, for all of our partners, for the entire ecosystem, enabling a broad range of scenarios, enabling seamless coexistence of cloud scenarios, on premises scenarios, or scenarios hosted, and run by our partners, as many of them do today.

I’m very excited about this announcement. This is truly unique. In our view, this is just another step in an amazing journey that we’ve been on for the last 10 years since our entrance in the market of business applications, the journey that is aimed at serving your needs; the journey that is aimed at solving your problems; the journey that is aimed at helping you be dynamic; the journey that is aimed at helping you be successful at whatever environment and whatever business climate we’re in; the journey that enables you to win under any condition.

I’m very excited about the future. The future of Dynamics is bright. The future of business applications from Microsoft is powerful, and it enables you to get to the new level of success. I’m very happy you’re here with us for this journey. I’m very happy you’re joining us for Convergence 2011. I’m confident that you’re going to walk away from this show knowing more about our products, knowing more about directions and becoming more successful.

Thank you very much. Enjoy the room. (Applause.)

END