China Microsoft Dynamics 365 Partner Opportunity
I recently returned from a business trip to Beijing, China and was blown away by the massive opportunity for Microsoft Partners wanting to grow a Power Platform or Dynamics 365 business in this region.
The size and scale of this market are almost beyond comprehension. Many looking at this market opportunity may be worried about the language differences but that should not stop you. I am reminded of the following story:
Two salespeople from competing companies are sent to a foreign country to assess the market for shoes.
Salesperson One scouts around for a few days and then heads for the telegraph office to contact company headquarters writes: “Research complete. Unmitigated disaster. Nobody here wears shoes.”
Likewise, Salesperson Two does similar research and heads for the same telegraph office. Once there, composes the following: “Research complete. Glorious opportunity! Nobody here wears shoes!”
I side with Salesperson Two in the situation.
In my experience of working with the Chinese people I saw first hand their incredible hospitality and desire to learn. From the first day in the office I was welcomed and made to feel at home.
From water to cups of tea, lunch and dinner out. They welcomed me as well as taught me about local culture.
I observed a deep sense of the importance of family and friendship as well as treating people with dignity. Microsoft have a substantial footprint in China with somewhere near 10,000 staff.
For many years Microsoft have offered Azure and Office 365 in the China market through a partnership with 21Vianet. These services cannot be sold via Microsoft's traditional offering due to legal requirements so they must collaborate with a local company, in this case that company is 21Vianet also referred to as 21V.
In April 2019, Microsoft released Mooncake delivering Dynamics 365 in China and increasing their commitment to this market.
Like many countries, China takes the handling of Personally Identifiable Information (PII) data seriously and require data residency of this information within China.
Microsoft as always take compliance and trust seriously and have released the China Trust Centre and also offer Support and Fasttrack services for the China market.
I believe that the Microsoft Common Data Service that underpins Dynamics 365 is how many businesses will be able to adopt and develop AI that enhances people's lives and day-to-day roles in business.
On-premise software will not survive in a world of AI, especially as we move to an age of quantum computing. It takes cloud computing to train algorithms at scale, and I think this is where the Power Platform offers massive opportunity.
Multi-national companies are the low hanging fruit in China right now for Microsoft Partners wanting to establish themselves in that region, especially Partners with vertical IP that allows them to enter a specific industry vertical with domain knowledge.
Industries
As I see it, industries that have a lot of upside right now for Microsoft Partners are:
Hi-Tech Manufacturing
Retail
Financial Services
Logistics
Telecommunications and Utilities
Global System Integrators (SIs) are potentially leaving money on the table when they fail to lean on the global expertise that they have in other markets. China is a digital gold rush for Microsoft Partners.
Microsoft Partners need to establish feet on the ground, go after lighthouse opportunities, and scale their presence in China.
If a five-year view investment is made into China, it will not take a lot of effort to scale an operation. I would suggest forming a tight mutually beneficial relationship with Microsoft Consulting Services (MCS) – note: I said, mutually beneficial, not subservient.
This will allow partners to get set up in market with billable work. This will give you time to scale a university graduate program with local universities that are full of bright talent.
In my observation for local partners to grow successful Power Platform and Dynamics 365 businesses, there is a need to add Design Thinking or Human Centred Design skills and change management skills such as Prosci to development skills.
This coupled with tight vertical subject matter expertise will foster growth.
There was a time when Napster was in high demand and usage, when people wanted to get access to great music in less than ethical ways.
Now we live in a time where Spotify provides access to most music at a reasonable cost, therefore making it easy for people to purchase and consume music.
Dynamics 365 has been available as an on-premise installation since 2003. There is no way for Microsoft to monitor how many licenses are in use. Therefore it would be safe to assume that if a company has, let’s say, purchased 200 seats of Dynamics 365, it would be hard to tell if they were actually using 200 seats or 2000.
However, if you ask this company to now join you in the cloud, there may be some resistance; some thinking will be needed to address this.
In some markets, a ‘stick’ will not address this, so a ‘carrot’ will need to be found to create the change.
In China, the local labour cost is low, so you need to factor this into any economic equation for target customers.
Making things ‘more efficient’ or automating tasks may not be a selling theme in the China market. With such a high volume of people at low costs, sometimes, to do nothing is acceptable for business.
WeChat is WhatsApp on steroids and so much more. In the West, we are missing a tool like this that everyone in China takes for-granted.
WeChat is not just a communication tool, it's also the main payment tool used by everybody, and I mean everybody! My credit cards in China were almost a waste of time. The only place I could use a credit card was to pay for my hotel. They were not accepted anywhere else – not for food, nor transport, nor beer.
In China WeChat is the universal tool for payment, so of course I am now on WeChat going by the name of nz365guy. Joining also made it possible for me to chat with my new friends and colleagues.
I could not add money to it as it only accepts mainland China credit cards (If you know how to get a mainland china credit card please let me know).
What does this mean for Dynamics 365? Easy, it needs a Microsoft/WeChat connector ASAP. I understand most partners in China have already created their own, but a lot of value could be added (read: drive more sales) if Microsoft/WeChat released a connector.
China Global WeChat WhatsApps (partially) QQ Messenger Apps Welbo Twitter/Facebook DouYin TicTok Youtube Youku / Tencent LinkedIn ? (Whoops! I forgot this one) Tinder Momo
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Social Media
I want to mention Social Media, since most of the western social media tools are of little value in China.
LinkedIn is a big deal in the western world but in China not so much. Therefore, I asked a few business people and came up with this list to give you an idea of the alternatives in China.
China is a land filled with opportunity for companies wanting to setup or establish a practice in China and the timing is good with Microsoft establishing Dynamics 365 in the cloud with Mooncake.
I am sure that Microsoft will continue to invest in the Dynamics 365 offering in China and increase the level of parity with what Microsoft offers globally.
If you have questions, please comment below.
