Monday’s Musings: Decoupling Support From Maintenance – What Apps Vendors Can Learn From Microsoft Dynamics

Who Says Support Has To Be Bundled With Maintenance?

About a decade back, vendors would offer support and maintenance as two separate line items on their contracts.  Support would run about 5 to 10% the license fee and so would maintenance.  Keep in mind, average support and maintenance fees were under 15% back then.  Here’s a quick primer on what was covered:

• Maintenance.  Traditional areas include basic bug fixes, functional and performance enhancements, upgrades, backward compatibility, and legislative and regulatory updates.
• Support.  Most requests fall in the technical support category.  Support cases typically include installation issues, integration questions, third product compatibility, and complex scenario resolutions.

Today, almost every vendor in the enterprise apps world (i.e. ERP, CRM, SCM, eCommerce, etc) has decided to bundle the two line items together. It’s now known as software maintenance and support and vendors charge between 18 and 28% of net price.

Microsoft Dynamics Uniquely Provides A Separated Maintenance And Support Option With Choice, Value And Flexibility

While many in the software industry has become obsessed with locking customers into maintenance and support contracts, the Microsoft Dynamics team set out to differentiate the ownership experience around the key principles of choice, value, and predictability (see Figure 1).

• Choice.  After the initial purchase, Microsoft Dynamics has offered customers the option to purchase maintenance and support separately.  This is unique to the industry for three reasons because customers:

1. 1. Choose whether or not to buy maintenance.
   2. Determine who they go to for support.
   3. Separate the technical support from the maintenance decision.

• Value.  Microsoft’s maintenance plan bundles a series of customer friendly services that deliver value.  The include
  1. Unlimited acccess to eLearning.  Customers can get to any course at any time with their maintenance dollar.  There’s no requirement for expensive week long training academies.
  2. 24 hour self-service support. Microsoft’s invested in its self support community and has 1000 new users a month with 30,000 self-help posts to date.  Most questions can be addressed in the discussion forum or directly by an expert.
  3. 10 years of lifecycle support. Most vendors provide a 5 year plan with escalating costs in the 6th and 7th years.  10 years represents a reasonable life cycle for ERP.

• Predictability.  Along with the 10 years of lifecycle support, Microsoft Dynamics will use the original purchase price as the basis of calculating future maintenance fees.  Users must stay current on enhancements to qualify.

Figure 1: Microsoft Dynamics’ Delivers Choice and Value In Its Support And Maintenance Offerings

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The Bottom Line – Users Should Demand A Split In Maintenance And Support…