Why Companies Prefer Dynamics CRM Online

There might be many reasons why companies prefer Dynamics CRM 2011 online. Among these the prominent are:

  • To avoid investing in the hardware and software required for on-premises version. Also on-premises need a dedicated team of managers, business analysts and developers to maintain the whole CRM framework.
  • If an enterprise is small to medium scale, it makes sense for it to go for Cloud version and pay only for the actual use.
  • Companies feel more secure on Cloud. Having their Dynamics CRM database on Cloud might be safer because it is constantly backed up without fail. Microsoft Azure has many back-up and fail-safe mechanisms working round the clock. It is seen that most threat to the data comes from internal employees and this is not the problem, any more, on the Cloud.
  • Another reason favouring Dynamics CRM Online is that it can be accessed 24*7 and anywhere around the world. The company employees only need an active internet connection and Internet Explorer.

Why Companies Don’t Prefer Dynamics CRM Online

There are reasons why enterprises never want to have the Cloud version of Microsoft Dynamics CRM 2011. Some of the times the companies move back from Cloud to on-premises Dynamics CRM. Some of the prominent reasons are:

  • Slow internet connection in the countries where the companies operate could be a major problem. One of the requirements is to have an active internet connection. A fast connection always helps.
  • There are some technical limitations to Microsoft Dynamics CRM 2011 online as compared to on-premises version. Companies would like to have full control over the technical development around Dynamics CRM 2011.
  • Companies and their management are still are not comfortable putting their sensitive business and client data on the Cloud.
  • Medium to large organisations don't mind investing in hardware and software. These enterprises have cash to employ people and set up an internal software department. Many companies still like to stick to the old model of having everything in-house.
  • If companies don't have their own in-house IT department they prefer a local consultancy firm to handle their CRM infrastructure. Companies still prefer to see someone present physically as compared to having a virtual presence in the cloud.
  • Performance of Microsoft Dynamics CRM Online is often good but sometimes not good enough. In on-premise environments performance can be tuned on both hardware and software level, which is not possible in Online.
  • Some companies prefer to have their CRM behind firewalls so that a user account that has been compromized does not give people outside the office access.
  • Some companies require data to be physically stored in certain countries which cannot be handled by CRM-Online, especially companies in healthcare, banking and defence industries.

Limitations of Dynamics CRM Online Vs On Premises

There are few limitations of Dynamics CRM 2011 Online. Many of them are due to the nature of being on Cloud. In my opinion the advantages of being on Cloud far outweigh the small number of limitations it possesses. These limitations are:

  • There is a limitation to maximum number of custom entities that can be created. Looking at the brighter side, this limitation is practically very high. Rarely can any of the enterprise level CRM 2011 projects max out this limit of custom entities.
  • You have to pay for every GB of database usage.  If your CRM 2011 has significant file attachment requirements then the database size could go in terabytes. To minimise these costs, companies can use a document storage solution such as SharePoint 2010 along with Online Dynamics CRM 2011.
  • Dynamics CRM online doesn't support custom workflow activity assemblies. The business rules and the functionality which you intend to run should be put inside a plugin. (Custom workflows have been added as of update rollup 12)
  • Fully trusted plugins are not supported. Whenever you create plugins for Dynamics CRM online always test your plugins in sandbox mode. Dynamics CRM online only support plugins to run in sandbox mode.
  • Custom ASPX pages are not supported for customising Dynamics CRM online.
  • Custom SSRS reports which are based on "TSQL and filtered views" data sets are not supported. Dynamics CRM 2011 online only supports Fetch XML based custom reports. TSQL gives you much more flexibility as compared to Fetch XML.
  • A normal On-premise user CAL can be used in multiple environments, ex. QA, production, training, staging, development. In CRM-Online, a separate user access has to be bought for each organization. [Update: Additional lnstance licensing has now been added to Dynamics CRM Online where a single user license can be used across multiple instances without the need to purchase separate CALs.]
  • Report snapshots are not supported and/or access to create report subscriptions through the SQL Server Reporting Services Manager is not available.
  • There is a limit of 300 custom entities with Dynamics CRM Online.
  • You are limited to 200 Workflows and Dialogs in Dynamics CRM Online.


I would like to emphasise that the limitations of Microsoft Dynamics CRM 2011 online are very few as compared to the many benefits it provides. These benefits span from technical to financials.

  • You can have your own dedicated Dynamics CRM 2011 on Microsoft Cloud in less than 5 minutes. You will be paying only for what you need.
  • You don't have to worry about backups any more. Microsoft hardware and software setups will take care of backups.
  • You don't have to employ a team of CRM administrators. Microsoft team will take care of all your needs.
  • On top of these benefits your whole Dynamics CRM 2011 infrastructure sits on the solid foundation of Azure framework.

I hope this blog about 'Microsoft Dynamics CRM 2011 – Limitations of Dynamics CRM Online Vs On Premises' was informative. Please feel free to leave your comments.