A special Report from the editors of RCP

PARTNER’S Guide to
Making the Most of
Dynamics 365 IUR

A lot of Microsoft partners heavily leverage their Internal Use Rights (IUR) for
Office 365 and various Microsoft server products. But Microsoft’s Dynamics 365
business applications are a highly valuable—and underutilized—IUR benefit.
Here’s how to get the most out of them. By Scott Bekker

T
he microsoft partner Network partners who qualify for either a silver competency or a
(MPN) is one of the most feature-rich gold competency qualify for IUR. Core IUR include things
partner programs in the channel. like Windows 10 Enterprise, Office 365 E3, Power BI Pro,
There are hundreds of discrete Azure Active Directory Basic, Azure credits, Microsoft
benefits, which, properly used, more Intune, Enterprise Mobility + Security, Windows Server
than make up for both the direct and indirect costs of 2016 with Client Access Licenses (CALs) and Remote
participating in the program. Among those benefits, Desktop Services CALs, SQL Server, Visual Studio
one of the highest-rated by partners is Internal Use Enterprise and many other products. In the old days,
Rights (IUR), the not-for-resale Microsoft software the software came on discs and used to fill a pretty big
one photo/ shutterstock.COM

and services that partners can use to run their own case. These days it’s all by digital download, but the
business and build deep expertise on the products. functionality is even more substantial.
Partners view IUR as critical to their business for many When most partners talk about IUR, they’re referring
reasons, and for smaller partners, the IUR grants can to those core infrastructure products—Windows 10,
even play a significant role in the company’s profitability. Office 365, Windows Server and SQL Server. But some of
Partners who subscribe to the Microsoft Action Pack and the most transformative products in the mix for partner

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Dynamics 365 IUR

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businesses are less often used, and can be extremely valuable. general internal business purposes. IUR can be used for training
Namely, the Dynamics 365 IUR. of a partner’s internal employees, as well. No-nos for IUR are
Dynamics 365 is the online suite launched in late 2016 as an numerous. Things that are expressly prohibited include reselling
umbrella online suite for business applications that included both the IUR or transferring IUR to a third party. Employees can’t have
rebranded and rearchitected versions of existing Microsoft cloud the software for personal use at home. Similarly, other Software
business applications and converted and updated products that Assurance-type benefits do not apply to partners with IUR. The
used to be on-premises only. licenses cannot be installed at a customer site.
Granted, Dynamics 365 is not for everyone. For the smallest IUR also are not to be used for direct revenue-generating activities,
partners, flat files like Excel spreadsheets or entry-level, Software- such as hosting a customer’s applications or developing custom
as-a-Service (SaaS) CRM solutions may suffice rather than a full- solutions for a specific client. Those commercial prohibitions get into
fledged business suite. For managed services providers, meanwhile, a grey area for partners, whose general internal business purposes
the market-specific professional service automation tools designed and commercial purposes can overlap. Microsoft offers a somewhat
for running those types of business are often a better fit. At large dated example in a May 2018 “Microsoft Partner Network Benefit
partner organizations, where the Microsoft practice is but one line Package Usage Guide.” In it, Microsoft notes that “installing the
of business, the decision may be made higher up in the organization Windows Server operating system and Microsoft Exchange Server
than the level of the Microsoft partnership. At any size organization, to set up an email system that you can use to send business-related
there may be a cultural fit and mature business processes built email is acceptable. However, production use for external commercial
around Salesforce.com or other commercial packages. purposes, such as hosting a commercial website, is outside the scope
For partners of nearly any size looking to accelerate their own of these rights.” Partners do need to be careful because Microsoft
business, to save on the cost of customer relationship management sometimes conducts compliance audits. Just remember the idea
or enterprise resource planning functionality and to become more behind IUR, and you’ll generally be OK. When in doubt, ask a Microsoft
knowledgeable about products they’re selling (both Dynamics partner contact.
365 and about the features unlocked within a full-stack Microsoft
solution), Dynamics 365 can be a great choice. That’s especially Going by Size
true for Microsoft Cloud Solution Provider (CSP) partners looking The baseline IUR grants are intended to provide enough licenses
to add Dynamics 365 services into the bundles they’re offering to and subscriptions for a partner to completely run its business
their CSP customers. Meanwhile, partners running some Dynamics on its IUR, based on some assumptions Microsoft makes about
365 already are often passing up opportunities to get more out of the size of a company that’s going to pursue each MPN level.
the suite. Action Pack IUR aim to support a business of about 10 people.
Given that in most business scenarios, not everyone needs access
What Partners Get to the Dynamics system, IUR tend to be doled out at a slightly
The basic package when it comes to partner IUR is the Dynamics lower number than infrastructure IUR. So for the Action Pack,
365 Customer Engagement Plan. Similar to a package with a list Microsoft offers five seats of the Customer Engagement Plan.
price for customers of $115 per user per month, the Customer Partners attaining the silver competency tend to be all over the map
Engagement Plan includes Dynamics 365 for Sales, Dynamics in size. The middling requirements—it’s harder to achieve than an
365 for Customer Service, Dynamics 365 for Project Service Action Pack subscription, but not as onerous as a gold competency—
Automation and Dynamics 365 for Field Service. The IUR also mean that partners going for silver tend to be larger than Action
covers Microsoft Social Engagement functionality, a portal and Pack subscribers. Yet there are many silver competency partners
database storage of 10GB plus 5GB for every 20 full users. For that are comparable in size to Action Pack subscribers. On the other
those keeping score from acquisitions and previous products, hand, channel companies with sizable businesses that are new to the
the Sales and Customer Service modules grew out of Dynamics Microsoft ecosystem can linger for a while at the silver competency
CRM, while the Project Service Automation and Field Service level before graduating to gold, if ever. Microsoft’s working model
modules were developed from Microsoft’s FieldOne acquisition was to deliver enough software and services to support a company
in 2015. of about 25 employees at the silver level. For Dynamics IUR, that
translates to 15 Customer Engagement Plan seats.
What Partners Can and Can’t Do With IUR Gold competency IUR aim to support a company with up to 100
Rules for IUR support a lot of partner use cases, with significant employees, with an IUR limit on the Dynamics side of 60 seats. Not
caveats. First on the allow list, obviously, is internal use. That wanting to punish successful multi-geography partners who scale
means partners can use their Dynamics IUR for development, beyond 100 employees by charging them to use the Microsoft software
test, demo, sandbox and, most critically, in production for they’re helping Microsoft peddle, Microsoft has a couple of other

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 Dynamics 365 IUR

configurations. One is a country-level limit, which allows partner who already have access to IUR, letting the Dynamics
organizations with multiple gold competency locations in a country IUR sit around can be like leaving money on the table. Yet
to have up to 300 Dynamics 365 Customer Engagement Plan IUR. Microsoft’s recent emphasis on cultivating ISVs to create
Worldwide organizations top out even higher with up to 900 seats applications that run on top of Dynamics 365 means
in the plan. there are other applications that can bring value not
Partners who find they need more seats, or who grow beyond the only to customers, but to partners themselves. Examples
IUR grants, have another option. Microsoft has a discount rate for include marketing automation like ClickDimensions and
partners to buy additional Customer Engagement Plan seats at $50 Salesfusion, CSP automation solution Work 365, electronic
per seat/month. The limit for the discount seats is 100 per partner signature tools like DocuSign and document creation tools
organization. like XperiDo. These applications are different from the
Dynamics IUR in that partners must pay the ISVs directly for
Getting Specialized the software, as opposed to using something they already
What if an organization is larger than its competency level, but have rights to. Even so, the cost is less than it would be to buy
really specialized on Dynamics 365? There’s an answer for that. a CRM application from scratch and then pay for add-ons
Partners who attain the Cloud CRM competency have higher on top of it.
limits for internal use. Silver Cloud CRM competency partners are
eligible for double the Customer Engagement Plan IUR, topping Positioning for the IP Push
out at 30 seats. For partners with the gold version of that compe- Even for partners using their Dynamics IUR, perhaps
tency, Microsoft allows an additional 25 seats for a total of 85 the most important opportunity lies in developing their
seats. Partners with that competency, as well as CSP partners and own intellectual property (IP) for solutions. Ultimately,
partners who have Software Advisor Agreements with Microsoft, Microsoft is looking for different types of partners these
are also eligible for demo benefit licenses. In those cases, the days than it used to, and partners modifying solutions and
partners can set up and customize multiple demo scenarios and bundles around Dynamics 365 could have a leg up.
test environments to show customers. The demo benefit licenses Microsoft U.S. President Kate Johnson discussed the current
consist of 50 seats of Dynamics 365 Professional, split into 10 keys Microsoft view of the ideal partner in a recent partner webcast:
of five seats each. “It’s all about intellectual property. Just bringing products to
the table is not going to work anymore. That was something that
Kicking the Tires worked in the past. If you had great technology that’s all you
Given that they can essentially get started for only the cost of their needed and you were done,” Johnson said. “Today, it’s really all
MPN fees, partners often start small with Dynamics 365. Kicking about the people being able to bring intellectual property. So
the tires can be as simple as using Dynamics 365 for straightfor- whether it’s industry domain skills, whether it’s deep technical
ward contact management. The more executive buy-in, the better. skills, in the space of security, let’s say, or whether it’s the …
If a senior executive is pushing the solution, it’s more likely that combination of both to provide a unique solution to an industry,
sales, marketing and service teams will use the software and it’s about the intellectual property.”
start finding deeper uses for it. Graduating to opportunity track- Dynamics partners tend to have the greatest success in
ing, putting service tickets into the system, and even managing verticals, where they can add IP to solutions that often don’t even
licenses are all ways to broaden the internal usage of the powerful lead with the Microsoft name. Playing around with Dynamics
toolset. One relatively little-known aspect of Dynamics 365 is the IUR and thinking deeply about new industry-specific solutions
gamification functionality. Another 2015 Microsoft acquisition, based on Dynamics can be a promising path forward.
FantasySalesTeam specialized in incentive programs and contests
to improve sales team participation and motivation. Some part- At a retail value of $115 per user per seat, those Dynamics
ners report getting a revenue bump in the high-single-digit to 365 IUR are crying out to be used by partners. For an Action
low-double-digit range by instituting internal programs using the Pack partner, that’s $6,900 in straight license value ready to be
tools in Dynamics 365. In any event, the more familiar partners thrown into production. For a gold competency partner, those
are with Dynamics internally, the more of its features they’re able licenses could be worth about $80,000. Admittedly those are
to light up, explain or sell to their customers. rough estimates, and on the high side given standard discounts,
but by any reckoning, Dynamics IUR count as one of the hidden
Branching Out Beyond Microsoft gems of the Microsoft Partner Network. •
The main thing for partners is to get rolling on using potentially
idle Dynamics 365 licenses when it makes sense. For partners Scott Bekker is editor in chief of RCP magazine.

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