As you,probably, already know, Nigel Frank International now is conducting Dynamics Salary Survey
Of course, primary goal for these guys (or these ladies – looks more like it) is to collect HR-database with contact of potential hires, as they always asking you to fill out your contact data in the end of survey. Yet the results of of the survey, which they promise to send everyone, who submit this survey can be very interesting for everyone in Dynamics AX community. I have filled out this questionnaire already, because I am interested in three things:
- Quite naturally, I want to know which country has highest salary for a Dynamics AX specialist. 😉 Especially, after this salary is normalized by,say, Expatistan cost of living index
- I want to figure out the proportion between cost of software (Dynamics AX in our case) and cost of implementation. Say, 11 years ago, when I started my career as an Axapta specialist, typical DAX project budget in Russia was around $100-120K for software and about $80-90K for for consulting. Now, after 10 years of high oil prices and consequential dollar wages increase, average salary in Dynamics AX market in Russia grew four-folds. Now, even with considerable increase in Dynamics AX price per user seat, cost of consulting typically is about 200% of software purchase costs. I am wondering, which country has highest, say, highest annual-wage to user-license-price ratio and which country – lowest. Actually, it looks a bit peculiar for me, that Microsoft use almost the same sales price for all countries regardless of their GDP per capita and average salary. I guess, if Microsoft pricing policy would be more flexible, they could greatly increase their user base in less-well-to-do countries. It might pay pretty well in future, but it requires more strategic kind of thinking then typical Microsoft executive have…
- I am also want to compare an average Dynamics CRM salary year-over-year. I think, we are witnessing a kind of commoditization of Dynamics CRM market. In most cases, Dynamics CRM is used simply as development environment to make ANY kind of custom development. No significant knowledge in consulting in general and sales management principles in particular is required to enter this market. Most of Dynamics CRM specialists (at least, people I had chance to meet and work with) are techies, who studied Dynamics CRM in a row of other Microsoft technologies (somewhere after ASP.NET and MS SQL, but before Biztalk). So, I expect drop in average Dynamics CRM salaries in future. I recently red that Dynamics CRM revenue for Microsoft has increased by 30% in last quarter. It might be a good indication of forthcoming salary drop. Demand for CRM specialists will increase sharply and then drop sharply as well. Sooner or later, knowledge of Dynamics CRM can become kind of commodity knowledge, like knowledge of C# or MS SQL. It can still bring money, but this money won’t be as good as 2-3 years ago…
So, I hope that this survey will be representative enough to provide every participant with relevant data. That’s why it is so important for everyone to fill it out…
#2: When you figure out how to do it, Microsoft and other soft giants will pay you big bucks. So far, no one has been able to do that differentiation by country and its economic standing. And another thing to think about it: when you buy a car in Germany and in Russia, the price is more or less the same (at least, no one cares about the economic situation). Why do you think it should be different for software?
The only thing you missing is that significant part of car’s price are direct manufacturing costs, which are unavoidable and per-item by definition. In software, R&D costs are not per item. After DAX2012 has been released, costs are fixed. So, Microsoft can have a bit more of revenue by selling Dynamics AX on a lower price in countries with lower economical development. Of course, I remember that Marketing and Channel management costs also contribute to the price of software as well as support costs and these costs depends on number of copies sold. But the problem is – support, marketing and channel management is executed by Microsoft so poorly, that without it, the product would not sell the worse. Really, do you think that this talks about ‘Cloud’ ‘Flexible Interface’ or ‘Integration to other Microsoft’s product’ can help sell the stuff ? ERP is sold to the corporate executives and to sell it, you should at least show some understanding of customer’s business and pain points and tell him how you product can help it. Whole Microsoft marketing is trying to sell some in-existent, imaginable product ‘Microsoft Dynamics’ and not any of Microsoft specific diverse range of ERP-products. So, I guess for less developed countries, Microsoft can sell Axapta w/o marketing and through un-managed channel and it basically change nothing…
And just for the record: In early and mid-90s, Novell were selling in Russia, Russian localized version of Netware for much cheaper price (like 40% of regular price). As far as I know, it led to considerable growth in their revenue and increase in market share…
And finally: When I started to work with Axapta in 2001, typical cost of 1 user (for typical installation) was about 1300-1400 USD per user. Now list price is about 3000 EUR. Well, I expect that it can be dropped to 2500EUR per user after negotiations with local MS office. It is like 2.5 times growth. Compare with how prices of Microsoft Office grew from 2001 to 2012. They also grew up, but as far as I remember – about 40-60%, not 2.5 times. What is the reason for such a significant growth ?
The fact that MS has put a lot of development $$ in the base product and acquired a bunch of ISV solutions to incorporate into the base product and decrease the gaps.
Plus of course it is time to milk the Danish cow they bought.
Well, first of all, the very basic rule of accounting principle is that we MUST differentiate expenses and assets. Not all expenses actually add value to a base asset. Some expenses can even decrease the value. ( Say – new Distributions/Source Document architecture or ‘normalization’ in DAX2012). The whole Axapta’s history after Microsoft’s acquisition can be a textbook example of this rule. Much money have been spent on development. 40% of it actually increased the product’s value; 40% of it – had no influence on product value (Say – integration with Office Communicator);20% of it decreased product value. (Say – aforementioned features of compilation into CIL).
Second, allow me to remind you, that in marketing a task of finding appropriate price for a good has nothing to do with costs of the good itself. Marketologist must find a point on Price elasticity of demand graph, where PED is equal to 1. The very idea that this graph can be the same for so different markets as Germany/Columbia/USA/Serbia/Indonesia is totally wrong. I understand that it is not easy to find this point, but this is one of the main function of marketing. Pity that instead of doing real market study, MBS’ marketing department is spending a huuuge funds on generating inconsistent rain of buzzwords about clouds, role-based experience, dynamic business and so on
Just was attarcted by Denis’ comments and thoughts about MBS policies and way of development and promoting AX. Completely support it.
Interesting deep analysis Denis. I have been wondering why can’t MS sell software with differently price on each country. The only reasoning that I thought is that perhaps MS wants to prevent one for abusing license, e.g. multinational company buys license from the cheapest country it can possibly buy.
They could link users to languages. Like 20 cheap users with Albanian and 100 expensive users with Swiss-German dialect.
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