The Difference Between Microsoft Dynamics NAV and AX

Microsoft Dynamics offers a variety of ERP solutions. You might say there is a solution for every purpose and every industry. Two of the offerings, Dynamics NAV and Dynamics AX (now part of Dynamics 365) share some of the same features so you might wonder: ‘what are the differences and which is right for my organization?’

Both ERP solutions are highly customizable, available in and adaptable to many languages and currencies used around the world. The two solutions can also be employed in a central location or across diverse satellite locations and are designed to grow as a business grows. Their industry-specific functionality can assure compliance with local and regional requirements. In short, both solutions could rightly be described as comprehensive and well equipped to manage complex requirements of supply chain and inventory.

So, what is the difference? Is one better than the other for your particular organization?

It really comes down to a question of the size of your organization and how well the solution aligns with your goals and projected growth.

Is your business small to mid-size or larger?

Microsoft Dynamics NAV is marketed toward small to mid-size companies, those generating between 5 and 500 million dollars and having some international components. Smaller businesses may well be better able to afford Dynamics NAV and therefore compete technologically with organizations many times their size.  As the business grows, the ability to scale and keep pace with its organizational goals is crucial, and NAV is designed to do just that. The ease of customization and ability to scale make Dynamics NAV an excellent choice for many small to mid-size organizations.

Dynamics AX (now called Dynamics 365 for Operations), on the other hand, is designed for larger, enterprise-class organizations with a broader international presence. The unique challenges of these larger organizations which may deploy across continents, languages, and currencies can be well met by Dynamics AX (Dynamics 365). Again, both solutions are designed to scale and grow along with your organization, but one of the main differences between these solutions is that AX/365 is better equipped to address the specific size and scale challenges of large enterprise organizations.

Do you have dedicated resources?

Another consideration is that AX/365 is somewhat more complicated than NAV. Implementation will be more complex and time-consuming requiring more decisions and demanding excellent project management in order to be successful. Dynamics NAV implementations may require only part-time project managers and smaller implementation teams. After installation, Dynamics AX/365 will often require dedicated technical resources to manage the solution, while Dynamics NAV will not. Naturally, because of the increased complexity, Dynamics AX/365 will cost more to implement and run than will Dynamics NAV.

Do you have global operations?

Dynamics AX/365 is better for managing large-scale global operations. This will prove significant for large manufacturers who need to view inventory in various international locations and have visibility into all areas of a large organization. Dynamics NAV is a very popular, effective ERP solution for growing international businesses that don’t yet have such a complicated organizational structure.

Both Dynamics NAV and AX/365 provide your organization with excellent business agility, intelligence, and analytics. The two ERP solutions, Dynamics AX (now Dynamics 365) as well as Dynamics NAV are designed specifically for the challenge of adapting quickly to changing business circumstances and growth.

Both solutions are available as hosted ERP solutions or a combination of hosted and on-premises solutions. Choosing the cloud-hosted model further increases the agility and breadth of both.

So which is best?

Although their capabilities are similar, Dynamics AX/365 and Dynamics NAV were designed for different organizational types, structures, and sizes. One is not better than the other; they are simply intended to be matched with corresponding business complexity and size.

Investing in an ERP system is a big decision, and the first step is having a clear vision of your company’s goals, strategies, and structure. Your Microsoft Dynamics partner should be able to help you determine which solution will best suit your organization.