Convergence 2010 Keynote

Remarks by Stephen Elop, President, Microsoft Business Division; Michael Park, Corporate Vice President, Microsoft Business Solutions; and Kirill Tatarinov, Corporate Vice President, Microsoft Business Solutions
Atlanta, Georgia
April 25, 2010

ANNOUNCER: Ladies and gentlemen, please welcome corporate vice president, Microsoft Business Solutions, sales, marketing and operation, Michael Park. (Applause.)

MICHAEL PARK: Good morning. Welcome to Convergence.

My name is Michael Park, and I’m honored to be hosting you here at this year’s 14th annual Convergence in Atlanta.

It’s great to see, from where I can see, such a packed room of about 8,500 people, and I want to thank you first of all for taking time out of your weekend and your work schedules to be with us here, to learn and to connect.

The theme of Convergence is today, tomorrow, and together. And you’re going to see from the keynote session that we’re here to tell that story.

Stephen Elop, president of Microsoft Business Division, is going to talk about the vision of where we are today. Kirill Tatarinov is going to come up after Stephen and talk about relative to Microsoft Business Solutions where are we going.

And we’ve been hearkening hard to deliver content and presentation, some great demos, some great customer stories, and perhaps even a couple of celebrities, to really showcase for you some of the stories that we have to tell you.

And let’s talk about customers. Before we get going today, I want to take a moment to congratulate our customer excellence award winners. These customers have achieved outstanding success in using the Dynamics technology to drive their business forward, and we’re grateful for the adoption of the technology and the commitment to our solutions for their success.

So, let’s take a moment and give those customers a hand. (Applause.)

There’s also a great set of partners behind those customers, and so those partners as well we want to thank you. Thanks very much. (Applause.)

I also want to spend some time talking about a special customer who uses both Dynamics CRM and ERP, and this customer is UNICEF. The U.S. fund for UNICEF is a not-for-profit organization that’s really dedicated. Its mission is to save children’s lives all over the world. And we’ve got a short video to introduce you to UNICEF. Let’s roll the clip.

(Video segment.)


MICHAEL PARK: This is just a glimpse to the start of a very powerful story, and we’ll hear more about the UNICEF story as we go through the keynote today. We’re very proud that our solutions are helping them deliver on their mission.

Now, Convergence is designed by you. Every year we take feedback, and we get great ideas about how to make it better.

This year, we want to continue to improve that experience, so please send us your feedback. And it’s for a good cause as well. For every survey that’s submitted we’ll make a donation to UNICEF, and you’ll also be put into a raffle where there’s a lot of prizes, including our grand prize, which is a $5,000 travel voucher. So, please take the time to submit the survey, because it really helps us in thinking about how to make the experience better for all of you.

Volunteerism was another area that we hear a lot about, and we love to do in the local community. And at the pavilion this week we’re going to have the hospital art painting session all week. So, I’d encourage you to come in and do a little painting, because those paintings are actually going to be assessed, and the ones that actually look pretty good are going to be put up in the children’s hospital for the kids, to raise their spirits when they’re in the hospital.

We also want to make sure that it’s not just Microsoft talking to you, and so we’ve created the user communities, and they’ve been deeply involved.

So, for the customer user groups I want to thank you guys for your commitment to help us bring a deeper and more in depth dialogue to the equation. They’re deeply involved in helping us, setting up all of the content that you’re going to see in the interactive dialogue. So, it’s super that we actually have that kind of engagement, because we have a representation of Microsoft, our partners, and our customers in an interactive dialogue.

We also for the user group communities, for those of you who are members out there, we’re going to be integrating the technology to allow you guys to actually become part of the Dynamics community online. So, during Convergence, as you engage with the user groups, you will be engaging with the Microsoft Dynamics online communities as well, to broaden the sharing of information that we have across the ecosystems of our partners and our customers.

And lastly, social media. We hear that you guys want to be more involved in that, and we want the real-time feedback. So, make sure you go to the whacks for your favorite sites, join the conversation, and be involved with us, as this will continue on as we move forward beyond just this session of Convergence this week.

So, in closing, I hope you really maximize your time with us. There’s a whole component of learning and dialogue, nine general sessions, 400 concurrent general sessions about content that you can get information from, interactive discussions, hands-on labs. And then there’s the networking aspect, connecting customer to customer, making sure you’re meeting as partners other partners and other customers.

And also obviously be engaged with Microsoft at all levels. Convergence the name is actually designed to bring the customers, the partners, and the Microsoft resources together in this environment to learn together. We’ve got community learning centers, expo halls, and, of course, we’ve got all the receptions for that.

But most important have fun and enjoy the Convergence experience. I think we’ve got a lot of exciting stuff lined up for you. I want to thank you, and enjoy the keynote. (Applause.)

ANNOUNCER: Ladies and gentlemen, please welcome President, Microsoft Business Division, Stephen Elop. (Applause.)

STEPHEN ELOP: Thank you. Good morning. Thank you, and it’s great to be here. Indeed it’s an incredible opportunity to spend a Sunday morning with you. So, thank you very much for making that trip in.

I’ve got to tell you, these types of engagements, interacting with you, our customers and our partners, it’s a great big part of the reason that I enjoy my role at Microsoft so much.

And as Michael mentioned, there are 8,500 of you here in the audience today attending this 14th U.S. Convergence event, which is just simply amazing.

Now, think about just for a moment how far we’ve come since our first events in Orlando back in 1997. In ’97 there were about 150 people who attended, many of whom are in this audience today, which is a real testament to the commitment we have in both directions.

That first event was focused exclusively on Great Plains. The company, Great Plains, was headquartered in Fargo, North Dakota, and is indeed one of the two things for which Fargo is best known, and it had not yet been acquired by Microsoft.

There were only 24 breakout sessions at that first Convergence, and 15 exhibitors, and one of the exhibitors was Digital Equipment Corporation.

So, think about it, a lot has changed, and that’s a great indicator of just how much.

Now, while a lot has changed, there are some things that have remained remarkably consistent. For example, this event, Convergence, continues to serve as the place for us to learn, to learn about industry trends and related new technologies. It’s also the place for our community, for all of us to gather, to network, to party just a little bit, and to build some businesses together. So, it’s a great opportunity.

And as you can see, we remain committed. We remain committed to all of you in this audience, and to our new 300,000 Dynamics customers, and our more than 10,000 Dynamics partners worldwide.

So, thank you for this opportunity, thank you all for showing up on a Sunday morning. So, from Microsoft to you, thank you, and a round of applause. I really appreciate it. (Applause.)

Now, this is the second time that I have met with you in this forum. I was here two years ago, just a couple of weeks after I first joined Microsoft.

Now, back then, there were some new trends and things going on in information technology, things like social networking and cloud computing, things that were just beginning to get started in our business environment. They were certainly in the public domain, but they were just beginning to creep into the business.

Now, we are today in a very different place. We are at the center of a remarkable transition in and around just about everything we do related to technology. And just think about all of the changes that have taken place in the last two years. For example, there have been some significant changes in demographics, and the demographic profiles of companies around the world. Now, some of this is because of the rise of emerging markets, but some of it is because of the arrival of the millennial generation as they come into our workplace and redefine how we get things done.

So, I’ll tell you a story. I have five children. The eldest is my 18-year old son, who is just writing his final exam, actually in the next day or so, at the end of his first year of engineering in Hamilton, Ontario.

Now, the way he communicates is a bit different than some of us. It’s some sort of strange combination of Facebook, a bit of Twitter thrown in, some Skype, and certainly text messaging by the thousands a month. So, that’s how he communicates. E-mail, I’ve got to tell you, only once or twice do I get an e-mail from him a month, and it’s normally, “Hey Dad, Need some more money.” You’ve been there; if you have children in university, you’ve been there.

Yet in just a few years, hopefully, he’ll be entering the workforce. I say hopefully. We’ve got a few years to go here. But when he does, he is going to have to communicate effectively with each and every one of you somehow in your business, depending on where he lands, and you will have to communicate with him.

So, think about that challenge crossing multiple generations, communicating with people quite frankly who may still be most comfortable with the phone or voicemail or whatever.

So, bridging these generational gaps is a huge challenge for all of us, and is very much influencing how we design products for the future.

Now, changing demographics is one example, but there are a lot of other changes going on as well. For example, mobile devices and geographically dispersed teams are decoupling work from the physical office.

According to IDC, the world’s mobile worker population will pass the 1 billion mark this year, and it will grow to nearly 1.2 billion people by the year 2013. So, more than a third of the world’s workforce will be mobile connected and mobile working, and yet most organizations still don’t have a formal policy allowing employees to work remotely. So, we’ve got a lot of change going on there.

Another dynamic, another change is the whole consumerization of IT trend, this concept that technologies like Facebook and Twitter and all sorts of consumer hardware, they’re finding their way into the workplace. Our employees, our customers, they are more informed, they have smarter opinions, they are more deliberate in what they expect in the workplace. Yet they have it at home, they want to see it in the office. Why is it harder to get something done in the workplace than at home, why is that?

And as a result, those people are impacting our information technology decisions today more than ever before.

Just a few weeks ago, I was in Australia, and I was meeting with the CIO of a very large government ministry in the Australian government. And he was having a bit of a hard day. He came in and sat down in the meeting, and said that his boss, the minister of this particular department, was hacking on him, and the reason was because this minister’s mobile device wasn’t working well with the e-mail system within their environment. And, you know, that’s different today. Ten years ago, that wouldn’t have been the conversation, and yet the expectation of that minister was that things would work well and would work as they would expect them to, even in their personal lives.

Now, for all of this talk of change, I will tell you this. There is one change that is fundamentally redefining our industry and how we will get our jobs done, and that is the advent of cloud computing.

You and I have been through this type of generational change in the past: the advent of the graphical user interface, for example, a couple of decades ago; the browser-based Internet, and how that revolutionized computing in the mid-to-late ’90s. Cloud computing is just as big. This isn’t an obscure trend, it’s fundamentally redefining how we expect to get things done.

Now, the good news is this is not new for Microsoft. We have almost 15 years of experience dealing with very large cloud computing services. Indeed, our cloud infrastructure today supports more than 1 billion individuals, and 20 million businesses across all of the properties and all of the things that we do, including things like Windows Live and Hotmail, Xbox, our commercial online services, and a variety of others.

And we’re continuing to invest. We will spend this year alone $9.5 billion investing in research and development. About 70 percent of our engineers in our R&D teams today are focused on cloud computing related activities, and within the next two years that will grow to 90 percent. So, there’s no question Microsoft is committed to leading with this future, leading with cloud computing. As we like to say, we are all in, we’re all in to cloud computing.

But be aware that our intention is to fully embrace the cloud in a way that fits the needs of all of our customers, that helps take you from here to there, that allows you to take advantage of those new opportunities.

So, regardless of the size of your operations, from the smallest small and midsized business, to the very largest of enterprise, we are committed to ensuring that you get the same familiar, intuitive experience, the same enterprise grade capabilities, whether you’re running something on your own servers, in a partner hosted datacenter, or in a datacenter hosted by Microsoft.

Now, reflecting on the last two years, and on the feedback that you’ve provided, I know that you’re looking to take advantage, to help capitalize on some of these many changes and shifts that I just talked about, and I realize that some of you are just starting to consider some of their impact, like cloud computing, how does it impact your business.

My most important message to you today is to tell you that we are committed to partnering with you through this period of generational change, today together, tomorrow working together; that’s what we’re focused on doing.

Now, part of how we do that, of course, because we are a software company, is by delivering the products and solutions to help take advantage of these changes. We are in the middle today of the biggest wave of innovation delivered by Microsoft in our history. It is an amazing time in our company. Back in Redmond, the excitement, the energy, it is just unbelievable.

Let me share a few examples of some of the things that are going on right now in our company. Earlier this year, we introduced Bing, and every month since we introduced that, we’ve been taking share away from a certain large competitor, one step at a time, just working hard at that.

Windows 7, boy, what an impact. The PC industry is just going through remarkable growth. Windows 7 is a big part of that.

Windows Server 2008 R2, Exchange 2010, really changing the way some of the infrastructure is delivered.

And something that’s very near and dear to my heart, and to the heart of more than 500 million people who use our technology every day, we announced the Released to Manufacturing of Office 2010, SharePoint 2010, Project and Visio 2010 just last week. It was just an amazing moment of celebration, because when we land technology like that, we know we’re going to impact the lives of so many people in such a positive way.

The good news is for businesses we’ll be having a launch event on May 12th with general availability in mid June. So, we’re very, very excited.

Now, it is interesting that each of these products come out, they each have standalone value, and that’s great, but our true competitive differentiator is the value derived through a consistent and world-class experience across those products, and well-designed and deliberate interoperability across our solutions.

I said it to you two years ago, and I’m saying it again today, the whole must be greater than the sum of the parts, and that is absolutely our focus.

So, whether it’s SharePoint 2010, Exchange 2010, Office, those are all strong examples of our commitment to that philosophy.

But Dynamics and the upcoming Dynamics releases are further examples of how we are lighting up this principle of the whole being greater than the sum of the parts.

Let me pause for a moment. I’m going to ask a question of the audience. How many of you here are Dynamics GP customers or partners? Just clap your hands, let me know, let me hear from you. (Applause.)

By our count, there’s some thousands of you here in this audience, and so I’m thrilled that you’re here.

Well, we have some big news for all of you. You’ve been seeing it coming. You’ve been asking about it. What are you doing here? So, I am thrilled to announce today the availability of Microsoft Dynamics GP 2010. Thank you. This is a great product for you, and a round of applause for something that’s just going to make a great difference for you. (Applause.)

Now, this is an ERP solution for businesses that are looking for ease of use, as well as some advanced functionality, strong business intelligence reporting capabilities, and interoperability with other line-of-business applications.

Now, just as we have a long history of building this community, we also have a long history of listening to you, and we listened to you as we were building GP 2010.

For example, you’ve asked for software that’s tailored to the individual roles in your organization, for the salesperson, the HR leader, the finance role and so on. GP 2010 responds, and it responds by providing 15 new out-of-the-box role centers, focused on those different roles within your organization.

You’ve asked for ways to simplify everyday tasks. GP 2010 responds again, enabling you to easily create professional looking purchase orders and invoices, using familiar products like Microsoft Word.

You’ve asked for better ways to contact people and systems that connect them, bring them all together. Again 2010 responds with 380 Web Services right out of the box, allowing you to interconnect different systems and process.

And you’ve asked for ubiquitous access to data through familiar applications, make it easy for our end users. GP 2010 responds with 400 built-in Microsoft SQL Server and Excel reporting services, just all built in together.

These are just a few of the incredible things that we’re delivering in this product, and we’re going to demonstrate that to you in just a few moments, but there are some other things going on as well.

Let me ask you, in this audience, round of applause if you are using one of our other ERP systems, Dynamics SL, NAV, or AX. Any of you out there? (Applause.)

OK. Every one of these products has also received significant updates over the last year, and some of you are reaping the benefits of these updates, but some of you are still here to learn more about that. Go to the sessions, learn about these new releases, and really absorb the potential impact that they could have on your business.

So, a lot going on with ERP, but of course Dynamics is more than just ERP. We are seeing tremendous momentum around our Dynamics CRM products, and we’re committed to providing you with CRM innovation at a very rapid pace.

And so I’m also excited to announce a new service update for Dynamics CRM Online, more capability coming here. It represents our first wave in our effort to expand CRM Online into international markets, first by adding multilingual support for our North American customers, and by the end of this year Dynamics CRM Online will be available in 32 markets.

Now, look at the pace of innovation here. This will be the fifth release of CRM Online in the past two years, and this release further improves Dynamics CRM connectivity between online and on-premises and between the CRM world and all of our other application environments and portals; so a major point of connection.

Now, you start to get the theme, there’s all of these different products, there’s all this innovation, but, of course, the whole is greater than the sum of the parts. We want to show these to you all working together.

So, please join me in welcoming onstage Barry Givens and Andy Westby, who are going to give us a bit of a demonstration to show us how this all comes together. Barry and Andy, come out onstage. (Applause.)

BARRY GIVENS: Good morning, Stephen. How are you doing?

STEPHEN ELOP: Good morning. Looks like you kept that robe on from the Omni.

BARRY GIVENS: I just rolled right out of bed.

STEPHEN ELOP: Good morning.

ANDY WESTBY: Good morning.

STEPHEN ELOP: Why don’t we start over here.

BARRY GIVENS: Well, this morning, Andy and I are working for Contoso Entertainment Systems. Andy is our purchasing manager, and he’s off in the Office. I’m our customer service manager, and I get to work from home today.

One of the reasons I can do that is because —

STEPHEN ELOP: That explains the pink slippers and the robe.

BARRY GIVENS: You’ve got to be comfortable when you’re working at home.


BARRY GIVENS: So, we’re using CRM Online here, and let me sign in. I want to find out what happened last night in my context center.

And we’ll bring up the site. The first thing that greets me really is our dashboard here, and I can see that we did have a lot of calls last night, a lot of return requests, which is a little disconcerting.

One of the other things that we can see over here is that we’ve got a lot of products coming in to inventory around these satellite speakers. Now, this is GP 2010 data.

STEPHEN ELOP: OK, so let me just — you’re at home. I just want to get the scenario right. You’re at home, you’re in an environment where you’re connecting through your computer but accessing both CRM Online and on-premises GP capability, fully integrated all at the same time.

BARRY GIVENS: Yeah, that’s right. I get all this full business context even though I’m working with a cloud system.

So, I see a pattern like this, and I start to think, you know, that we may have some kind of a product defect or a product recall issue. So, I need to do some more research around this problem.

And really the first place I want to go to do some more research is with the people who know the most about our products, and that’s our customers.

STEPHEN ELOP: Absolutely. Hard to tell just from staring at the data for sure.

BARRY GIVENS: Yeah, absolutely. So, what I’ll do is go out to our Contoso Entertainment Systems customer portal, and this is a customer portal that we built using our customer portal accelerators for CRM, and it will let us know, the site here that’s hosted up in Azure, so we’ve got great scale and terrific up time on the solution.

Now, the site lets us do more than just traditional customer portal activities like pushing knowledge-based articles out to customers. We can also provide a place for customers to interact with each other on forums and we’re also providing things like Twitter feeds and custom Bing search that lets us link to blog posts out on the Internet.

STEPHEN ELOP: OK, so this is a great example of social CRM. You’re bringing together not only the raw data we looked at, showing the pattern, but also the social aspects, listening to your customers in different forums, different networking feeds, bringing it all together to get a complete view of what’s really going on, better than just processing it as events.

BARRY GIVENS: Absolutely. Our customers are having these conversations with each other, and now we can join in these conversations with them through a site that we manage.

STEPHEN ELOP: Excellent.

BARRY GIVENS: And, in fact, one of those conversations is happening right here. Somebody has posted a blog post about these satellite speakers. They found an issue with them. So, let’s go check it out and find out what they had to say on their post.

So, this is out on an external blog site, and sure enough somebody has found some kind of a problem with their speakers.

Now, this may or may not be the issue that we’re dealing with, but take a look at what I can do. I’ll highlight this article, and I can push this article over to Microsoft Dynamics CRM as a knowledge-based article. Now, this is —

STEPHEN ELOP: You just used an accelerator right in there, moved it right into the knowledge base.

BARRY GIVENS: That’s right. Now, this is a draft knowledge-based article that my service team back in the office can iterate on, they can work on it, they can use this to jumpstart their investigation of this issue, and through the day they’ll edit this article, and when they’ve got it in good shape, they can send it back to me so that we can take that crowd sourced knowledge and hand it back to our customers.

STEPHEN ELOP: Excellent. Social CRM, working from home, discovered an issue, you’ve passed it back to the people who bothered to show up at the office today, is that correct?

BARRY GIVENS: That’s right.

STEPHEN ELOP: So, where are we going? Are we going over here?

BARRY GIVENS: That’s right. I’ve had a pretty good morning. I’ve got some more work to do. Andy is probably working on this, too.

STEPHEN ELOP: Andy, what are you doing over in the office?

ANDY WESTBY: Well, I came fully clothed today, Stephen.

STEPHEN ELOP: Good for you. Good for all of us actually.


Now, I’d like to welcome you, Stephen, and you fellow GP customers and partners to the brand new role center homepage of Microsoft Dynamics GP 2010.

Now, this role center is all about putting the information I need right at my fingertips. So, as a purchasing manager at Contoso Entertainment Systems I’ve got a couple of metrics here that help me keep on top of the things that I need to know about. Over here I’ve got a few different custom actions, reminders to do as follow-up, so I can really manage my day and know what I have to get done.

STEPHEN ELOP: So, things specific to this role to lead you through today’s activities?

ANDY WESTBY: Yep, exactly what I have to do.

And over here I even have my own real-time window into the Dynamics community and customer source through our connect Web part.

Now, let’s take a look at the issue that Barry happened to see over in CRM, which is this large spike in returns in the satellite speaker.

If we focus in on our top returned items metric, I can see the same information here, right? We see this huge spike in satellite speaker returns, and it’s shaded red because we’ve actually set up this chart to identify any items that have exceeded a certain return quantity threshold. So, we’ve gone over that, it’s highlighted in red, drawing my attention immediately to that issue.

We need to do some analysis now. We need to figure out what the problem here is.

With GP 2010, enhanced insight is literally just one click away. So, we can drill down on that report. This could be to an additional SQL report, it might be to an additional GP window, or in this case an Excel 2010 workbook, leveraging the new Power Pivot add-in.

Now, what Power Pivot enables me to do is really easily combine data from multiple systems to do a deep analysis. So, we’re using in this case CRM data and GP to look at my vendor performance and item return history.

STEPHEN ELOP: OK, so with one click you’re actually consolidating information, different systems, putting it in a tool that people can use, Excel, bringing all of those pieces together.

ANDY WESTBY: You’ve got it.

So, we need to take a look at this particular item. Let’s go ahead and filter in on the satellite speaker.

Now, Excel helps me identify, we’ve got two different suppliers that we actually receive this item from, High Tech Electronics and Audio Suppliers. So, we want to narrow in on which vendor the issue could be with.

STEPHEN ELOP: Yeah, who’s got the problem, who’s got the problem.

ANDY WESTBY: This doesn’t look overly concerning to me. These are pretty standard return reason codes.

STEPHEN ELOP: You’ve got a long of wrong items, but whatever.

ANDY WESTBY: Yeah, I blame that on the customer.

STEPHEN ELOP: Yeah, OK. (Laughter.)

ANDY WESTBY: Let’s take a look at the audio suppliers.

Here I think we’ve —

STEPHEN ELOP: Ooh, we’ve got the defective problem there.

ANDY WESTBY: — probably found our issue there. There’s a lot of defective items coming in for this particular item from this particular vendor.

STEPHEN ELOP: I’ve said to you before, they’re a pretty unprofessional group there. We’ve had that experience.

ANDY WESTBY: Yes, I think we may have.

So, what do we need to do next but actually reach out and contact the supplier.

STEPHEN ELOP: Let’s give them — yep.

ANDY WESTBY: Now, for a lot of customers and other systems it’s the manual process to go find that contact information, we’d place a call or we’d send an e-mail, neither of which is likely to get responded to, and this issue could drag on for days or maybe even weeks.

With GP 2010 right from Excel, with one click it’s going to take me directly back to Dynamics GP vendor maintenance.

STEPHEN ELOP: Ah, so closing the whole loop. You started in Dynamics and CRM, customer report into Excel, back into Dynamics, just as you’d expect the workflow virtuous cycle all the way around.

ANDY WESTBY: Exactly, made that complete circle.

Now, I’ll take it one step farther. If you take a look here, I’ve got my contact at Audio Suppliers, Errol Shane-Fish with this little green icon next to his name.

STEPHEN ELOP: I recognize that.

ANDY WESTBY: You recognize that. We have integration to unified communications and Office Communicator. So, I can actually see Errol is online, and we can resolve this issue in real time. So, why don’t we go ahead and initiate a video call with Errol. Hopefully he’s able to resolve this issue with us face to face.

Now, I know Errol, I’ve worked with Errol before. He tends to sleep at his desk every now and again. So, hopefully he’s actually backstage and ready for us.

STEPHEN ELOP: That pulsing sound isn’t a good sign, is it?

BARRY GIVENS: Anyone that’s worked with Errol knows this is a common problem.

STEPHEN ELOP: Try him again.

ANDY WESTBY: We’ll try Errol one more time here.

STEPHEN ELOP: This is the Sunday demo thing, isn’t it?

ANDY WESTBY: This is, yes, exactly.

STEPHEN ELOP: Call Errol again.

ANDY WESTBY: We’ll do it one more time here.

All right, Errol’s status is going in and out on us. So, we’ll do this.

STEPHEN ELOP: There we go.

ANDY WESTBY: Errol is going to be online.

STEPHEN ELOP: There’s Errol.

ANDY WESTBY: Errol has got no lights.

STEPHEN ELOP: I guess so. Can Errol even hear us? There he is. It’s a demo thing.


ANDY WESTBY: You were sleeping at your desk and the lights went out on you. It’s good that you’re back.

Errol, we’ve got a little issue here at Contoso Entertainment Systems. We’ve got a large spike in returns around a particular item. Rather than describe the whole issue, I’d like to just show you the report that I’ve got, if that’s OK.


ANDY WESTBY: All right. So, with — (Laughter.) With one click —

STEPHEN ELOP: We’re a customer, Errol, customer calling. (Laughter.)

ANDY WESTBY: So, with one click I’m going to actually go ahead and share out my desktop to Errol, so we can now collaborate on this document in real time. I don’t know have to e-mail it to him or describe the issue.

STEPHEN ELOP: OK, so right as part of that connection we can look at Errol, we can share with him.

ANDY WESTBY: Exactly. So, Errol is seeing my desktop now. He can see this report.

So, Errol, you’ll notice I’ve filtered this down to the item in your vendor records. We’ve got a large number of defective returns. Anything you can do to help us out with this?

ERROL SHANE-FISH: Well, that’s a pretty chart there, Andy. (Laughter.) What does that say?

ANDY WESTBY: Defective. That’s the word I want you to focus on.

ERROL SHANE-FISH: Well, that’s no good. (Laughter.) Yeah, let’s see. Well, I’d have to do a quality review, but let me think. Let’s see here, just a second.

ANDY WESTBY: Errol, I don’t have time for you to rip through your papers there. I need to resolve this issue a little quicker. Is there anything we can do?

ERROL SHANE-FISH: Well, we could — how about if we do a replacement part? 1163 I think is the one to replace. You’d better check that in your fancy, fancy system you got there. (Laughter.)

ANDY WESTBY: All right. I’ll get a replacement. 1163, Errol, is that the answer?

ERROL SHANE-FISH: I think that’s the one.

ANDY WESTBY: That’s the answer. All right.

Well, that’s going to satisfy our issue in the short term. Errol, I’m going to get a PO entered, sent off to you right away. Do what you can to get us that part as soon as possible.

STEPHEN ELOP: Hang up on Errol, will you?

ERROL SHANE-FISH: All right. (Laughter.)

STEPHEN ELOP: None of us have ever met Errol before.

ANDY WESTBY: All right, so we know what we’ve got to do, we’ve got to enter a PO for this particular item.

Now, again in a lot of systems it’s a manual process, I’ve got to go find my PO window, find my vendor in that list. It’s a lot of steps.

Well, let me show you how easy this is with GP 2010.

STEPHEN ELOP: You’re still coming out of Communicator.

ANDY WESTBY: I’m still in Communicator. I look at his name, and I’ve got a list of options where I can actually drill directly to GP and create transactions.

So, in this case what we’re going to do is create a purchase order in Dynamics GP.

STEPHEN ELOP: Beautiful.

ANDY WESTBY: So, that one click is going to open up that PO window for me, and it’s going to add Errol’s supplier records automatically to the transaction. So, all that’s left for me to do now is actually just enter in the details of the order. All right, so I’ve got the PO here.

Now, I have one last problem, Stephen, and I’m going to need your help with this. We actually have a PO over $20,000, and I’m only authorized to go up to $20,000. I can’t go over that.

STEPHEN ELOP: And you’re not going to split the PO?

ANDY WESTBY: I’m not going to split the PO.

STEPHEN ELOP: Good. (Laughter.)

ANDY WESTBY: So, what I need is an executive approval on this.

STEPHEN ELOP: Of course.

ANDY WESTBY: So, let’s get this through approval through our workflow.

STEPHEN ELOP: I’ll carefully read that and click on the approve button.

ANDY WESTBY: All right, so we’ve gone ahead and submitted that to workflow. Now, you have been authorized to sign off on this, and you could do that in SharePoint, you could do that in the GP client, but I thought it might be fun to actually illustrate how you could potentially do this if you had a Windows Phone 7 device.

STEPHEN ELOP: Ah, this is one of the rare places where this has ever been shown, Windows Phone 7, the next generation of Windows mobility.

ANDY WESTBY: You’re right.

So, I’m here on the Windows Phone 7 home screen. I’ve got access to my calendar, to my Office apps, to the people I communicate with regularly. But, of course, we want to take a look at our e-mail.

So, here I am in Outlook. We’ll go to my unread e-mails. I have an e-mail waiting asking for approval. So, let’s go ahead and drill in.

There’s my e-mail details.

STEPHEN ELOP: Beautiful.

ANDY WESTBY: I can see all that information, do a little zoom in. And I’ve got a link to go ahead and approve this. So, let’s go ahead and open up that link.

There’s my approval page. Now we can do a little more zoom.

STEPHEN ELOP: Looks good.

ANDY WESTBY: You’ve seen the PO. I don’t need to show you my details. I’m going to go ahead and click approve.

All right, there we go, we’ve go ahead and submitted our approval for that workflow.

STEPHEN ELOP: Fantastic.

ANDY WESTBY: Isn’t that good, all those pieces working together? (Applause.)

All right, last step.

STEPHEN ELOP: Last step.

ANDY WESTBY: I’ve got to get that PO to Errol.


ANDY WESTBY: He needs to process that purchase order.

Now, if we think about this in a lot of systems, again I’ve got to print the e-mail out, I stuff it in an envelope, I do it the old fashioned way, or perhaps I have an electronic file. I attach it to an e-mail, I find their e-mail address, and I type in a message; a lot of manual steps.

With GP 2010 you see this little icon here, this little mail icon?

STEPHEN ELOP: OK, let’s just move it along to him.

ANDY WESTBY: Let’s just move it along. Let’s click that button. It’s going to automatically generate an e-mail, populate that with a message, attach a Word document, and send that along.

So, we take a look, I’ll pop to my outbox here real quick. There’s my e-mail to Errol.

STEPHEN ELOP: We should probably copy Errol’s boss.

ANDY WESTBY: We probably should have. (Laughter.)

So, here we’ve got the e-mail to Errol. If you’ll notice, we have a Word document attached as well. So, if I open this up —

STEPHEN ELOP: Beautiful.

ANDY WESTBY: — I get all of that GP purchase order information, in a very nice looking form I might add, so Errol can easily see this and process that purchase order.

STEPHEN ELOP: Excellent.

ANDY WESTBY: Now, Stephen, what you’ve really just witnessed is how Dynamics GP 2010 really is the new way to do business for someone like a purchasing manager, an everyday user of the system.

You’re an executive though. You’re probably asking, what’s in it for me, or the managers out in the audience who aren’t necessarily an everyday user, but you need to get access to information.

Let me show you how GP 2010 delivers. I’m looking here at one of the 15 out-of-the-box dashboards with GP 2010. Now, these dashboards can be personalized by role. We have over 120 KPIs, charts and metrics that you can drill down into and really get the information that you need.

And you’ll also notice we can combine information from multiple systems. So, here we’ve got a CRM pipeline stack.

So, regardless of which system the data actually resides in, I can get that information right here at my fingertips.

Now, the last thing I want to point out here over in the bottom right is the same exact metric you saw on my GP client. So, we can actually share these metrics between the client and the browser.

STEPHEN ELOP: Beautiful.

ANDY WESTBY: And we’ve also gone one month in advance. We’re into May now.

STEPHEN ELOP: We’re into May.

ANDY WESTBY: And you notice the returns in May have basically gone away.

STEPHEN ELOP: Errol came through.

ANDY WESTBY: We’ve been able to satisfy this issue.

So, you know what, there’s one last thing. I’ve had a blast showing off GP 2010 to everybody but —

STEPHEN ELOP: In the office.

ANDY WESTBY: In the office.

STEPHEN ELOP: You’ve got to take care of the customer.

ANDY WESTBY: Barry has got to take care of our customers.

STEPHEN ELOP: Hey, thank you.

ANDY WESTBY: Thank you, Stephen.

STEPHEN ELOP: OK. I see you’ve got dressed. (Laughter, applause.)

BARRY GIVENS: You know, when you’re comfortable, you’re comfortable.


ANDY WESTBY: And I’ve been very comfortable and productive today. I’ve gotten a lot of work done while you were gone. We’ve got a list of accounts here. I was able to create a list of all of those customers that had satellite speakers from Audio Suppliers. I was able to do that because we had all of that GP inventory data here in the CRM system.

STEPHEN ELOP: Excellent.

ANDY WESTBY: I created that list, sent e-mails out to all of them. A lot of e-mails; there’s really just one more thing I need to do, which is approve that knowledge-based article.

STEPHEN ELOP: Close the whole loop to get the information up there.

BARRY GIVENS: Absolutely.

So, our unapproved knowledge-based article right here. I’ll approve that, and as soon as it’s approved, we should be able to find that out on our customer-facing website.

STEPHEN ELOP: All the way to where we started. Let’s go back to the social environment.

BARRY GIVENS: That’s right. So, we’ll take a look here, and whether the customers now get that e-mail from us or whether they come to our website and get a knowledge-based article, they’ll get a similar experience here where they’re able to find that knowledge-based article —

STEPHEN ELOP: There’s the new article.

BARRY GIVENS: Absolutely.

STEPHEN ELOP: Workflow automatically posted it up there.

BARRY GIVENS: Absolutely, and they’ll get a link to go close the loop and schedule a service with us so that we can get out and replace the speakers.

STEPHEN ELOP: Excellent.

So, let me summarize what we’ve seen. What we’ve seen overall, Dynamics GP 2010, CRM Online, Excel, Word, Office Communicator, the power of Windows Azure for the portal, all of those pieces all coming together seamlessly.

Barry and Andy, thank you very much. It was a great demonstration. Great job. (Applause.)

Of course, all of us at Microsoft are excited about these releases, but one of the things that really thrills us is the degree of excitement that we feel back from our customers from all over the world, and from many of you here in this room.

At the Worldwide Partner Conference, for example, just last year, we announced that Dynamics CRM growth was 40 percent, despite a challenging economy. Dynamics CRM continues to grow at double digit rates as we go through this fiscal year as well.

So, today, we are happy to say that there are more than 22,000 Dynamics CRM customers around the world, and over 1.1 million users using this every day somewhere on the globe.

This would not be possible without the support of thousands of Dynamics partners worldwide. Just amazing the impact they’ve had.

One of the things that has also helped a great deal is we’ve really worked with you to help you work with us on our various technical adoption programs, helping us to develop these products, getting your feedback, understanding what the bugs are, dealing with the issues.

Our teams have dedicated tens of thousands of project hours to work with you on the TAP, and you’ve given so much back to us.

And we’re seeing incredible results from this joint effort. For example, Forum Communications, a media company based in Fargo, and a TAP participant, received the beta version DVDs the very evening they were released — so this is beta code — and they were live in production with our beta code the next morning, 10 hours later. Just amazing, and the reason that was possible, because we had worked so closely together to make sure quality was where it needed to be, that the features were there, and we could work with them to take them through that; just amazing results.

Another TAP customer, Jason Johnson remarked, my favorite thing about GP 2010 is getting to spend more time with my dog. Thank you for that, Jason. Nice dog.

The point here is saving time, saving money, and allowing you to focus on something that’s just a bit higher value than some of the mundane chores. That is what it’s all about.

This level of commitment from you to us and vice versa is helping us to improve and fine tune the product, even before we get to market.

Now, there are thousands of other examples of customers who are benefiting from Dynamics solutions, including stories from many people here in this audience. For example, Malis Merrill (ph), who’s here in the audience today with her team from New Belgium Brewing, the folks that produce Fat Tire Ale — we’re all familiar with that. I heard some clapping somewhere, Fat Tire, excellent. (Applause.) They’re using a combination of Dynamics GP, SharePoint, Office Communications Server, and Windows Mobile to keep a close eye on inventory, sales, and costs, and to enhance communication and collaboration across their enterprise. As a result of their deployment, they’ve cut shipment forecast errors from 8 percent to 4 percent, and that’s money right to their bottom line, which is fantastic.

Another example is provided by John Moynihan and Robert Ritchie, and their organization, Specialists on Call. Specialists on Call provides thousands of smaller and midsized hospitals around the U.S. with immediate remote access to world class neurologists. From start to finish, their deployment of Dynamics CRM Online took just 90 days — not 12 months, not years of messing around, just 90 days. And as a result, they now have an automated system for managing sales, interaction with the hospitals, managing all of the patient cases. They can handle more growth, more customers, add more staff with the money they’ve saved, because you know what, their solution costs $200,000 less than the competing solution from

So, we’re very proud to share that there are many customers making an investment with us. It also includes a whole range of sports franchises, which we just have a lot of fun with: European football, NBA teams, Major League Baseball, near and dear to my Canadian heart, a number of NHL teams, relying on our Dynamics solutions. And, of course, a great stat, 23 out of the 32 NFL teams, the football teams, are Microsoft Dynamics customers. So, we’ve really hit a sweet spot with these organizations.

Now, there are thousands of other organizations, millions of customers using Dynamics to run their business. One of the ones that we’ve seen here today though, and one that we want to spend a bit more time on, is the U.S. Fund for UNICEF. It’s inspiring to learn how this particular Dynamics customer embraces innovation to drive real change for real people around the world. Let’s take a next look at their story.

(Video segment.)

STEPHEN ELOP: Isn’t that great to see. (Applause.) So, we are proud to play a role in helping UNICEF improve the lives of children all over the world, and we’re proud of the relationship that we’ve established with them.

Now, as you’ve seen today, and as you’ll continue to see throughout this week, Dynamics is the pinnacle, the absolute cap of all of the value that Microsoft delivers. It takes advantage of just about everything that we do, bringing it all together from business applications through mobile technologies. My job, and the job of every Microsoft representative is to help you take advantage of the immense wave of innovation that Microsoft is delivering today, tomorrow, and together. Our job is to help you through this incredible time of change. So, please, take advantage of this week, talk with us, ask us the tough questions and learn. And please enjoy Convergence 2010. Thank you. (Applause.)

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

KIRILL TATARINOV: Well, good morning, everyone. I’m very excited to join Michael and Stephen welcoming you to Convergence 2010 on this beautiful Sunday morning here in Atlanta.

This is my third Convergence event as the leader of Microsoft Dynamics. And every Convergence is different, lots of things change, environments around us change, the technology trends change. Certainly, the mood is different this year. I had a chance to speak to a few of our partners last night, and the mood is different, you feel excitement. You think that things are changing, and you see lots of more positive attitudes towards what’s going on.

But, with all Convergence events being very different, there is one thing that has been constant, and will continue to be constant forever and ever, and that thing is our commitment to your success, our commitment that is expressed in innovation, in product releases, in solutions, in our connections with our partners and our customers, expressed here at Convergence events.

Stephen talked to you about the biggest wave of products that’s coming to you, our business customers, this year. The biggest releases from our platform products, Windows Server, Exchange, SQL Server, Microsoft Office 2010, and of course Microsoft ERP and CRM, GP 2010, and updates to CRM Online products, phenomenal testaments for our commitments, our commitment to innovation and our commitment to your success. We’re innovating to help you become dynamic businesses. We’re innovating to give you solutions that would enable your people to become more productive, and your business processes to become flexible.

The best way to talk about what we’re doing, and what we’re delivering is, of course, to tell you the story of one of our customers who has become a dynamic business, and who has successfully implemented solutions, and gotten themselves on the path into the future. And I want to start talking about the future, and talking about our vision by telling you the story of a company called InFocus.

Now, many of you are very well familiar with this organization. In fact, I think every single person in the room have either used their products, or had experience with their products. They deliver equipment for projection, for learning experience, for putting up presentations and for getting them on screen. This organization is a worldwide leader. They’re based in Oregon, and they have been delivering solutions for a number of years.

Now, in 2007 they were faced with a very tough competitive environment. And they had to go through a very significant transformation of their strategy, and their business. Effectively, they were in a position where they had to outsource their manufacturing, and not only that, they had to reduce the company going from 900 full time employees to about 400, and going from being public organizations to being private companies.

Dramatic change, dramatic change that touches all aspects of that organization, impacts their people, impacts their processes, impacts and creates completely new relationships with their suppliers, with people who are manufacturing for them. Now, of course, with a change like that IT systems are expected to be the core part of the transformation, and core part of the change.

Now, prior to the change, back in 2007, InFocus used to run Oracle ERP, and they also owned licenses for Oracle CRM. And, of course, the first natural step for them was to attempt to do a transformation based on the existing system. Very rapidly they found out that it would be just prohibitively costly, and not only that, very quickly they found out that it would be absolutely impossible to modify the aging Oracle ERP system that they had running.

They discovered Dynamics AX, and they very rapidly discovered that by implementing Dynamics AX they can not only support all the necessary flexibility and transform their business processes, putting the company in the future and supporting the strategic transformation they were going through, but they were also able to dramatically increase productivity of their people, by giving them a role-tailored user experience.

Just by replacing their ERP system, and all of the underlying components going on the Microsoft stack, and going on with Microsoft Dynamics Partners, they’re able to face 1 million dollars a year on their ERP systems alone. In the process of replacing the ERP system they also discovered Dynamics CRM. The Oracle CRM systems that they had licenses for were not used. It was zero utilization and people within the InFocus organization just refused to touch the environment that was not user friendly.

By implementing Dynamics CRM, and by going live with the system, they’re now able to deliver to their sales people tools that dramatically increases their productivity and gives them the ability to drive increased sales, increased sales even though they reduce their expenses by about half, a dramatic improvement for our stability, driven by investments in CRP and CRM.

To us this is a great example of an organization that embraces change, and that that thinks strategically, and looks at how IT systems can support this change, and can project it into the future. And now, three years later, still reaping the benefits of the investments in new systems, and in new technology, the InFocus organization can extract dramatic benefits from this investments, 125 percent increase in productivity, driven by both ERP and CRM investments, 20 percent faster reporting, and of course dramatic reductions in their overall IT costs.

Going from $5 million to less than $2 million in all-up IT costs. But, not only that, in the process of that transformation of the IT organization they looked at the new trends in technology and they looked at the cloud and they found that the cloud enabled them to implement systems faster and implement systems more efficiently. They partnered with Microsoft’s preferred provider, team solutions, and Avanade, to deliver hosted ERP, hosted CRM, and hosted IT infrastructure that is now delivered to them from partner clouds, and that is yet another example of our all encompassing strategy, a strategy where we all-in as a company deliver to our customers, and delivers to their success, and delivers real savings and real productivity benefits here today and now. And, of course, help the in-focus organization go into the future.

Now, I know representatives of InFocus are here in the room, let’s give them a round of applause on their success. (Applause.) A little over a year ago we introduced our vision of Dynamic business to the markets here in the United States for the first time. The vision that truly helps us articulate the benefits of Microsoft Dynamics, the benefits of solid investments in ERP and CRM systems and it really helps you articulate those benefits to your internal stakeholders.

We’ve been speaking to many of you, and many of our partners, in the industry and we’ve received incredibly positive feedback on this vision. It truly resonates, it truly helps you and it truly helps us together transform our industry and move it forward. Now, of course, we continue to advance this vision. We continue to look into the future, and we continue to make sure that we are delivering future-proof solutions to you, solutions that are not only solving real problems today, but will be solving these problems three, five, 10 years from now.

Now, we were discussing dynamic business with Nigel Montgomery just a couple of weeks ago. Nigel is probably somewhere here in the room. Nigel works with Gartner AMR, he represents them here, and we consider Nigel being one of the most knowledgeable people in our industry. And Nigel, when we were talking about dynamic business, Nigel said to us, and it’s pretty hard to transform Russian into British accent, so I apologize, but he said, dynamic business is the one that does not stand still. And that’s, in fact, what dynamic business is all about. It’s probably the simplest way to explain what it’s all about.

We being dynamic businesses do not stand still. We continuously innovate. We continuously look for more opportunities. We continuously look for new ways to serve our customers. We continuously look for ways to transform our industries, and win, and deliver better solutions. We continuously look into the future. That’s what differentiates dynamic business from a traditional business that does stand still.

And by delivering on the vision of dynamic business, and by helping you embrace this vision, and by advancing this vision in the future, we differentiate ourselves from the rest of the business application markets, and we deliver on our commitment to our success by making your people more productive, by helping you transform your business processes, making them flexible and adaptable, and by helping embrace new realities of highly connected ecosystems.

Let’s look into this in a bit more detail. People, people are the life’s blood of any organization. People are what makes businesses succeed. We’ve been talking about role-tailored user experience. This is perhaps one of the biggest investments that Microsoft brought to the industry of business applications by fully embracing it, and delivering it now in all of the Microsoft Dynamics products. This is a prime example where massive investments in research and development resulted in a very concrete productivity gain by many of our customers.

Taking it forward, we’re now delivering what we call role-tailored insight, where business intelligence and analytics are delivered for the specific role in the context of those roles. This is something that you saw in the Dynamics GP 2010 demo, and that, of course, will permeate across the entire part of Microsoft Dynamics products. And we’ll continue to innovate on the pillar of people within the dynamic business. To us it remains to be the most important area of investment for Microsoft Dynamics and for Microsoft Business Solutions, making sure that we deliver software that is not only easy to use, easy to deploy, but software that people desire to use, software that transforms the trend, software that enables 100 percent utilization of ERP and CRM systems within the organization, software that is context aware, software that is behavior aware, software that truly makes people love it. And that’s only the way they start using it every day, day in and day out.

Process. Process is the backbone of any organization. Process is what makes organizations tick. Process is what makes organizations succeed. Process is what connects vision, strategy to day-to-day execution. It’s a very important asset of every single business. What’s important for successful process and business process orchestration, number one thing is flexibility. We’ve been talking about it, and we’re delivering flexibility now across the entire products of Dynamics CRM and ERP systems.

You saw the InFocus example, and you saw how InFocus by implementing flexibility business processes within Dynamics AX were able to adjust their business, and prepare for either growth or slowdown.

We deliver flexible workflow in all of our products that enable organizations to really fine tune their execution, and make sure that everything is connected. Another very important aspect of our execution on helping you implement adaptable process is industry expertise. Business processes have to be the best in class in the industry. We made a very strong commitment in building out a consistent and integrated layer of industry enablement in our Dynamics AX product.

And right now, we’re in the midst of the biggest transformation of Dynamics delivering on that commitment, and delivering on that layer. And in the next year, you will see massive rollout of industry enablement delivered to our customers with Microsoft delivering platforms and a number of our ISV partners extending this platform for specific verticals, and micro-verticals.

In the process area we yet again do not stand still. And the most important thing that we need to continue to evolve and deliver is predictability. Making sure that not only do you know what’s happening right now, and not only can you execute on current conditions, but you can also predict what’s going to happen in the future. And you have this system that really helps you look into the future and helps you prepare for anticipated change, and helps you play with what-if scenarios, and understand what will likely to come and be ready for that change.

Ecosystems, there’s a saying that no business is an island today. And, indeed, it’s true when you look at what’s happening, when you look at the trends, demographic change, changes in the overall world getting flatter and smaller, connectivity that is enabled by the cloud. It is an enormous, enormous enabler of a massive ecosystem shift that’s happening in the industry.

We’ve been talking to you about communication and collaboration being a very important pillar of the ecosystem. You’ve seen how communication and collaboration technology now connects straight into Dynamics ERP and Dynamics CRM. You’ve seen the seamless linkage that does not require people to jump through the hoops, apart from simple glitches when connection may not be established right away, but it’s all tightly integrated, and delivered straight from out of the box.

You’ve seen examples of social connections and social networking. Social networking now plays an enormous role, not only in our personal life, but also in our business lives. Whether it’s business to consumer type commerce, or business-to-business, social networking is a very important enabler. And we’re focused in embracing social networking in all our Dynamics products, helping you embrace it and deliver it.

And, of course, the cloud, and massive opportunities that clouds present really pushes the ecosystem forward and helps you deliver scenarios that were unheard of in the past. And the cloud perhaps is one most important significant area of investment for Microsoft Dynamics going forward, making sure that we deliver the breadth of scenarios that that cloud enables, making sure that we deliver wealth of services that enrich both ERP and CRM systems, where they in and of itself run from the cloud, or on premises by our customers. It’s a very important, very significant area, and our solutions today and into the future are designed to fully take advantage of this new trend and of those new enablers.

So, dynamic business, a little over a year since we introduced it to the market, truly resonates with everybody we talk to about dynamic business. It truly creates that very important North Star that enables us to move forward, and continue to execute on our commitment. And really helps all of us move forward towards becoming dynamic businesses, transform our businesses, transform relationships with many people who we interact with, make our processes flexible, and most importantly make our people the most productive, helping us, reaping the benefits of the dynamic business.

Microsoft has always been built on the vision of long-term innovation. Stephen spoke about $9.5 billion that we put in R&D this year alone. A significant portion of that $9.5 billion goes into very forward-looking research, research that really helps us analyze the trends, research that really helps us look forward and understand how the world of business is going to transform itself 3, 5, 10 years from now, it really helps us anticipate what are the systems that we will need to deliver to power you, to enable your success in the future.

And, of course, our job in Microsoft business solutions is to make sure that this wealth of investment that Microsoft puts as innovations is surfaced to our business customers. This is perhaps one area where we very much differentiated from the rest of the pack in the industry of business applications. It’s our ability to surface innovation that happens in Microsoft and the computing industry in general, and deliver it to the hands of our business customers straight out of the box. It’s a very important differentiator, and it continues to set us apart.

Now, in Microsoft Dynamics we’ve spent a significant time analyzing how people work, what are the new trends, and how people expect to work in the future. And today, in this keynote, I’m going to do something unorthodox. Usually, we show you technology that we’re either shipping or ready to ship in a few months. Here today, I’m going to show you something from the labs, something that we’re prototyping, something that we’re looking at, something that may ship a couple of years from now, or may never ship if we decide that this is not the right direction. But this is really our opportunity to show you a glimpse into the future, to show you what the world of business applications, what the world of Dynamics ERP and CRM may look like into the future.

So, I would like to invite Lachlan and Varun to join me here on stage, and help me show you what the future might look like. Lachlan and Varun.

VARUN KRISHNA: Thanks, Kirill.

OK. Well, we’re going to take you through a story today of how we envision the future of business applications. We’re going to look at some new technologies as well as how we blend them and bring value to the world of ERP and CRM. The scenario we’re going to take you through today is something that many of us in the room, I think, are familiar with, it’s how do you take a brand new product or service, and actually bring it to market. So, we’re going to try to do something that’s a little ambitious. In about 12 minutes, we’re going to try to go.

KIRILL TATARINOV: Unorthodox was the word I used, unorthodox.

VARUN KRISHNA: Unorthodox, OK. So, we’re going to try to do something ambitious. In 12 minutes, we’re going to take you from a concept through the manufacturing supply chain environment all the way into a retail store where someone is actually going to be able to purchase a product. So, let’s get started.

I’m going to ask everyone to imagine for a second that we’re working at a company called Alpine Ski House. And Alpine is in the ski and snowboard business. I know you’re a skier, so we thought you would appreciate that. And they’ve created a brand new snowboard prototype that they’re going to release into the market. So, let’s get our scenario started.

LACHLAN CASH: So, how do we capture new consumers? How do we know the product we’re about to launch will actually hit the mark with the rise of social networking, video sharing sites, we have amazing tools that we can use to reach out to consumers, and we can take those tools. This video starts our demo scenario, Alpine is using the Internet to prototype a new product. They’re targeting the teenage demographic. So, they’ve created the videos, they’ve released it to the Internet and described their product. From the feedback and reaction to comments and referrals, they have an enormous amount of data that we can use to help plan our product launch. And this is really early viral marketing, and it really all starts with the CRM system. So, we can take that and forecast and plan our product launch.

KIRILL TATARINOV: This what CRM of the future might look like, and productivity, but it’s also networking.

LACHLAN CASH: Exactly, the connection there. You saw a little bit of it earlier in the demo before about the social, the knowledge-based as well.

VARUN KRISHNA: Speaking of CRM systems, let’s take a look at how that application would be actually applied. We’ve done this marketing pilot about two weeks ago now, so let’s fast forward ahead. And now we’re in a sales forecasting meeting. So, we’re in a meeting environment now. We fast forwarded two weeks, and so we’ve launched that social media project. We’ve got some data back. I’m going to show you how we take that information and actually make business decisions.

The first thing I want to do is point out this beautiful, 65-inch high definition display. Now, you might look at a piece of hardware like this as being, boy, that looks really expensive. But the reality is, the prices of plasma monitors have come down significantly. All this is is a regular plasma television, and we’re done something interesting, we’ve put a touch overlay on top of it. These are commercially available today from a company called NextWindow. We’re running Windows 7 with natural user experiences and multi-touch. So, what we’ve created is basically a display wall that we can actually interact with.

So, as I walk up to the experience, and I see this meeting application, I can click on it, and it brings up a contextually relevant display for me. This is about this meeting. It’s about the environment that I need to be able to be successful in this meeting.

So, let me kind of orient you to what you’re seeing here. Across the top you see a dynamic agenda, this is moving and keeping me progressing through the meeting, and making sure that I’m being productive. Over at the right, seamlessly integrated unified communications, the ability to communicate and collaborate and interact with people across different channels.

Now, these large circles here are a new construct that we’ve envisioned. This is something that we call a work context. Now, typically when you work with projects, like this, a large prototype that you’re trying to release to market, there are a number of smaller, related tasks, activities, subprojects, marketing campaigns in this case, sales forecasting that you need to work on.

This is a way of aggregating all that information and providing it to me in a seamless experience that’s tailored to me. Now, I can actually interact with this display in a very natural way. I can zoom, zoom out, I can pan, let’s come back to the forecast here.

OK. So, I mentioned that we’re in a sales forecasting meeting, and what I want to do is I want to look at how much we think we’re going to sell of this particular product, sales forecasting is very important, a proactive part of the actual product manufacturing process.

KIRILL TATARINOV: Yet again, this is what CRM of the future might look like in the context of the way people are going to be interacting with Office and connectivity, and overall productivity experiences.

VARUN KRISHNA: Absolutely. What you’re looking at here is beyond ERP and CRM. It extends into the Office business productivity vision. It extends into the platforms and tools that we provide. What we’re showing you here is how we basically take all of that and surface it through a business application.

KIRILL TATARINOV: Great. Let’s look at the forecast.

VARUN KRISHNA: So, let’s look at our forecast, and again we’re interested in snowboarding. What you’re seeing here is I’m just basically filtering the display. We’re going to launch this part in the U.S. market. So, as I select that the new forecast appears. Now, let me bring your attention to these little green indicators. They’re telling me that for this particular forecast, these new snowboards, there’s additional information that might help me improve it.

By tapping on the indicator I’m given some additional information. Let me just bring this into focus here. There we go. Prototype technology, we’re trying something ambitious, excuse us. I’d bring that forecast into the actual application. This is the result of the social media. I’ve seamlessly just overlaid it into my actual forecast.

KIRILL TATARINOV: It’s a response from social network applications, the demand that we anticipated from broad outreach over-imposed on the real forecast.

VARUN KRISHNA: Exactly. We’ve just proactively increased the accuracy of our forecast using social media. Now, these systems are intelligent, of course, and they’ve helped me tremendously. But, the reality is, you need to leave room for the human element. My own knowledge, my own experience needs to be applied to the process in order to help fine tune and improve it further.

Now, in this case, if I drill a little further into this forecast I’m looking at the last half of the winter I might think, based on my experience and my knowledge that it’s going to be a shorter winter, that forecast looks very aggressive. And I actually want to bring that down a little bit to be more realistic and meet my expectations. So, if we have anyone in the room that’s been involved with any kind of forecasting where you’re looking at a graph like this, I’m going to do something now that I think we all wish we could do. I’m going to adjust it.

KIRILL TATARINOV: With a quarter adjustment to fall on the back end?

VARUN KRISHNA: Exactly, it’s all about under-promising and over-delivering. So, I’m happy with my forecast. I just need to approve that. and what’s going to happen now is this is going to trigger some changes in the back office. This is where the ERP application really clicks in. So, Lachlan, you’re now playing the role of our purchasing manager. I’m hoping that you were paying attention during that meeting. Why don’t you take us through some of the things that happened in the back office.

LACHLAN CASH: Yes, so I’m playing the role of the purchasing manager. I’m using an HP TX2 laptop here. So, I’m following along in the meeting. So, that forecast update is our demand signal tells us the sales volumes, the markets that we’re actually going to go and target. Of course, what happens in the backend ERP is the materials requirement planning process runs and generates our planned purchase orders. Now, I can see these here in our workspace. I can touch on these. So, I’m looking at a new visualization of the way that we can see our planned purchase orders. Of course, this is actually plotted out in the context of a timeline. And the size of the orders are represented by the bars.

Of course, the business application is helping me optimize the process and make critical decisions. I can see key indicators here, like this is quite a large order. Now, I can see on this border our partner ecosystem. So, we’re Alpine, we’re going to use Fabricam as our subcontractor, manufacturer to produce our products, and they’re going to ship to adventure works, which is our retailer. So, I’m quite happy with this. I’ve seen it in the forecast and I understand where the data comes from. I’m actually going to action this. So, I can actually firm this.

So, this is actually where the fun starts, this is where the supply chain kicks in. Now, this video illustrates our supply chain from manufacturing, the order is communicated to Fabricam using cloud service technology, like Windows Azure, for example. Proactive forecasting helps us better plan distribution to get the product to retail stores. So, we’ve got the product going to the retail store, it’s time to get the word out to the consumer.

KIRILL TATARINOV: This was the ERP glimpse of the future. This is what the ERP system might look like.

LACHLAN CASH: Exactly, role-tailored, user interface, providing different visualizations to people like the purchasing manager, for example.

VARUN KRISHNA: Very good. All right, so fast-forward a little ahead. The snowboards are in the store, and it’s time to get the word out. And that’s all about marketing. It’s about doing creative things to really impact your consumer and make them feel compelled to basically buy into your vision. So, one of the things that’s interesting about social media is you’ve seen that we’ve been able to cultivate and invest in a loyal community of people that really believe in our product. We know a lot about that consumer. So, we can actually market to them in a more compelling way.

Microsoft’s vision is about creating seamless experiences across different screens. That screen could be your PC at home, it could be your browser interacting with the cloud. It could be your mobile device. It could even be something like this, something that we’re starting to see in the marketplace, a digital billboard that you can actually interact with.

So, what we’re going to show you in this next video is an example of the mobile experience. In this case, the person is not online, they’re not at home. They’re actually on the road. Maybe they’re in a shopping district. What you’re seeing here is a targeted and relevant experience, targeted to that mobile user. We know so much about them that we can identify them as a loyalty card customer, we can offer them a promotion in the actual product. And we can actually, based on their location, based on services like Windows Azure, and Bing maps, we can plot their path to the actual store.

So, let’s bring it home to our final story, the in-store retail experience. The customer is in the store. Let me hand it back to you, Lachlan.

LACHLAN CASH: So, our vision for retail business applications is to help retailers provide a seamless connected experience, both in-store and online. So, I’m going to play the role of a teenager. And let me show you why this is  I think a teenager in a suit, how about that? So, let me show you why this is not an ordinary retail experience.

So, we’ve got a lot of information about the consumer from that early CRM. I can swap my loyalty card, and I can get access to the information. Now, a teenager may not want the store assistant to actually help them. So, we can provide a retail experience where we can look at this product, understand what’s happening with the product, to find more information about it, so I can interact with the display while I’m in-store.

Now, I could look at statistics, I can see different information about the product, for example, reviews online, for example. So, we can provide an immersive experience in the store. So, I can look at different designs, different designs of the product. So, let me stop there for a moment. In Dynamics we look at role-tailored user interfaces, and this is one example. This display could also be used by the assistant if they were helping someone in the store. They could walk could walk up to it, they could swipe their card and look at, for example, this particular board we have a stock out situation. If the customer is looking for this design.

KIRILL TATARINOV: This is a sales assistant view, not a customer view.

LACHLAN CASH: Exactly, and that’s the power of role-tailored design, the ability to authenticate and let different people log on and look, for example. So, we can show them data coming from the business applications. So, I can see this is out of stock, but of course, I can give them the information of when it’s actually going to come in, so they can have a sensible conversation with the consumer.

Now, let me continue the shopping experience. So, what we have here is the different design. I can touch and I can interact with it. I kind of like this design. So I’m going to add it to my shopping cart. Again, the profile information coming from the ERP and the CRM system, I can see that there in my shopping cart.

KIRILL TATARINOV: So, if the consumer wants to be recognized as they enter the store, there you have it.

LACHLAN CASH: Exactly. We provide them the ability to interact and get that data from the CRM system. So, we have a more immersive experience, for sure. So, we bought a snowboard. We probably want accessories if we’re buying a new board. So, let’s move departments then we’ll have a look at the accessories department.

So, again, I could walk up to the display and touch it, for example. So, I can interact with it.

Now, let me point out what we’re actually looking at here. So, I can see products, for example. These are the installed products. So, I can find more information about them. I might like this jacket, for example. So, again, I can add it to my shopping cart. What you’ll notice is that we’re trying to provide a seamless in-store experience. That’s following the person through the actual store. So, I can see the snowboard that I was looking at in the different departments, until they leave the store we won’t clear that out, for example.

What you’ll also see here is products, a different assortment actually from the online store. What we’re trying to communicate to the consumer is that when they leave the store they can continue purchasing from us. So, we can provide complete visibility. We can also run online promotions, for example.

KIRILL TATARINOV: Multi-channel, Web and in-store experiences linked together.

LACHLAN CASH: Exactly, trying to provide a seamless view for the retailer and the consumer. So, I like these goggles. I’m going to add them to my cart. So, when I walk out I’ll take two products, the other product will actually be shipped to me from the online store.

So, I can close this out. Of course, what’s going to be applied is the payment based on the record we have on file processed through Microsoft Dynamics Online Payment Services, for example. What we’re also going to add is a coupon to their account. We want to connect with them, and get them back, whether they come back in the store or online.

So, what we’re showing is a vision, a vision of business applications, and how in retail we can provide a connected, seamless experience that’s online and in store.

Varun, back to you.

VARUN KRISHNA: So, that’s the conclusion of our story. We started with a product. We turned it from a concept to reality. We ended with a great consumer experience, showing you kind of how we blended some exciting new technology paradigms into how we envision the future of business applications.

We hope you enjoyed the vision. Thank you very much. (Applause.)

KIRILL TATARINOV: Thank you, Varun. Thank you, Lachlan.

Doesn’t this future look wonderful? New form factors that will continue to empower the end user, and will continue to drive more productivity, and those new form factors that we’re taking into consideration as we build business applications of the future. Those are very important and significant differentiators.

Now, when I look at some of those end-user retail experiences, and you certainly recognize that some retailers today, very few retailers today are starting to innovate in this area. But what they’re having to go through is enormous custom development that costs them lots of money, lots of effort, and it’s really not something that they can sustain. Our goal here is to take innovation that is happening across the devices, across the cloud, across the broad range of computing platforms, and deliver it to our customers in repeatable fashion at low cost, and at high volume. That’s what we innovate on, and that’s why this demo is so exciting, because you will be seeing the glimpse of what you saw today delivered in the future.

The last scene that you saw in that vision demo was the retail experience. It was in store experience. We spoke last year about delivering to our retail customer being one of the most strategic imperatives for Microsoft Dynamics, and today I’m very pleased to announce that later this year, on August 1, we’ll be introducing the first Microsoft Dynamics branded retail solution, Microsoft Dynamics AX for Retail. That solution will enable special to retailers to implement the first step into this future. They’re going to be able to implement connected retail experience linking point of sale devices to back office ERP systems, connecting productivity enhancements for the retail floor all the way to the back office, all powered by Microsoft Dynamics, a very exciting testament of how Microsoft Dynamics is moving towards improving productivity, and delivering to very specific needs of very specific industries. A very important step in realizing, overall, the long-term vision of Microsoft Dynamics and the vision of dynamic business.

We’ve highlighted UNICEF here today as an example of nonprofit humanitarian organizations that can take advantage of our innovation that we typically deliver to our business customers. The UNICEF story is very important to me personally. I’ve been working with UNICEF for over 15 years now as a member of their advisory board within U.S. Fund for UNICEF. And it’s personally very rewarding to see the great partnership that with Microsoft we’re able to build with UNICEF to help them achieve their noble goal of going to zero. And it’s very important for us, and for me personally, to see this partnership evolve and grow into the future.

So, let’s take a look at the last segment of our UNICEF story, and see what the future holds for U.S. Fund for UNICEF.

(Video segment.)

What an amazing story. (Applause.) Now, in the world of business, we often talk in sports analogies. We talk about winning. We talk about competing. We talk about success. We’ll have to see our customer, and we’ll have to talk about our customers as winners. And some winning is bigger than others.

My final story today is the story of Microsoft Dynamics NAV customers. And I think that story deserves very special attention. I know that many of you here are NFL fans, and today we have a great opportunity to welcome one of the employees of a Dynamics NAV customer, ladies and gentlemen, New Orleans Saints Head Coach, Super Bowl XLIV Champion Sean Payton.

Sean, welcome. (Applause.)

SEAN PAYTON: It’s good to be here.

KIRILL TATARINOV: It’s good to have you join us here today. What an exciting occasion. We’re excited. Thank you. Thank you very much.

Fast road to championship, no stadium, hurricane, lots of challenges there.

SEAN PAYTON: We had just arrived, our staff, right after 2006 with a lot of things in the air undecided. No stadium. Really bringing families, hiring coaches, finding players, and trying to build a program, and here we are four years later with the Super Bowl Championship, and it’s nice to be telling that story in Atlanta. (Applause.)

KIRILL TATARINOV: All right. Sean, we all know reading about NFL, and reading about the New Orleans Saints that a lot happens off the field, lots of dynamics, lots of momentum, lots of interesting things, lots of people spent lots of time analyzing data, and looking at what’s going on with players, with statistics, with competition. Technology, I assume, plays a big role.

SEAN PAYTON: No question.

KIRILL TATARINOV: Do you use it?

SEAN PAYTON: Well, my first year in coaching was 1988 at San Diego State, and we spent a lot of time looking at film, and at that time it was just pure film, where you could only watch one specific play, no different than our music. You know, like an 8-track tape. And slowly it went to video, and now it’s all on computer. We just finished the draft this past weekend, Thursday, Friday, Saturday, and it was our first time with the new touch-screen product, where we put players up on the screen. It was unbelievable.

So, everything from how we look at film, how we really grade our own players, how we study the draft, it’s involved throughout the program.

KIRILL TATARINOV: Outstanding. That’s certainly great news. Now, one last question, Sean, how does it feel to be the Super Bowl Champions?

SEAN PAYTON: It’s like nothing else. Later this afternoon, I’m going to have a chance to visit just a little bit about that journey. But when you finally win a championship, it’s much more than the trophy or the accolades, it’s much more about the relationships with all the people in the building that got you there. And that’s what makes it most exciting, and really time to go to work.

KIRILL TATARINOV: Well, thank you, Sean, for speaking with us, and I know you will be addressing the business leadership track, and I hope many people can attend it, and listen in more detail on what’s been going on with the New Orleans Saints and this road to victory.

Now, we also know, and we heard that in addition to your main job, you wrote a screenplay called The Xbox Kids.


KIRILL TATARINOV: So, to recognize that part of your life, we want to present you for the New Orleans Saints with your logon. I hope your children enjoy it. (Applause.)

SEAN PAYTON: Thank you very much. They’ll put that to good use.

KIRILL TATARINOV: All right. Terrific. Thank you, Sean.

I want to thank you all for coming here. I want to thank you for your loyalty, and I want to thank you for your business. It is terrific to be here with you at Convergence 2010. You saw an amazing wave of technology innovations that we’re delivering to you this year. You saw a tremendous partnership that we’re delivering with our partners working together. And, of course, you saw a glimpse into the future.

Most importantly, here today at Convergence 2010 in Atlanta, we are celebrating your success. We’re celebrating your success as dynamic businesses. We’re celebrating your success as businesses that do not stand still. We’re celebrating your success as organizations that continue to transform themselves, and move into the future to embrace new opportunities, to face new challenges, and to serve your customers better. And Convergence 2010 is designed to enhance your ability to do better, and to move into the future with more knowledge, and with more ammunition to continue to win and continue to succeed.

Please enjoy Convergence 2010, there are many great things that are happening here at this fantastic event designed for you. Thank you very much. Please enjoy. (Applause.)