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Some Microsoft users still have legacy systems like NAV and Dynamics GP that require migration to more modern systems, such as Microsoft Business Central or Microsoft Dynamics 365 Finance & Operations. Or, a business may decide to migrate from another brand’s ERP to Microsoft Dynamics.
This guide covers the steps, a checklist, and best practices for Microsoft Dynamics migration.
Why Companies Migrate to Microsoft Dynamics—and When Itʼs Time to Make the Move
Whether your company is considering moving to a modern, cloud-based Microsoft Dynamics implementation from an outdated Microsoft ERP or starting a new implementation from a different accounting system, your team needs to decide when to change its ERP.
For example, if your small or mid-sized company is currently using SAP Business One and has decided to migrate from SAP to Microsoft Dynamics.
Migration Catalysts
Organizations typically migrate to Microsoft Dynamics when legacy systems begin limiting growth, compliance readiness, or operational visibility.
Common catalysts for migration to Microsoft Dynamics include:
- Dynamics GP end-of-life and reduced support
- NAV to Business Central modernization
- Moving from on-premise to Dynamics 365 cloud
- M&A consolidation across entities
- IPO preparation requiring an upgrade from legacy systems
- Reporting limitations in legacy systems
- Need for multi-entity and global scalability with global expansion
- Compliance and tax complexity, and outgrowing your current setup
Key Microsoft ERP Migration Scenarios
Microsoft ERP migrations generally fall into a few predictable paths, depending on your current system, growth stage, and deployment model.
Key migration scenarios include:
- From Dynamics NAV to Dynamics 365 Business Central
- From Dynamics GP to Dynamics 365 Finance
- From on-premise to Dynamics 365 cloud
- From your legacy ERP to Microsoft Dynamics
- Re-implementation vs in-place upgrade
Microsoft NAV and GP End-of-Life Transitions
With Microsoft NAV and GP approaching end-of-life or reduced support phases, many organizations must evaluate whether to modernize, re-platform, or remain on legacy infrastructure.
Questions to consider before migration are:
- When should your company upgrade from Microsoft NAV or GP?
- Is it worth migrating to Business Central?
If your business still uses Microsoft NAV or GP for its financial, supply chain, and production processes, it’s time to begin implementing a new ERP system (if you haven’t already).
Microsoft’s mainstream and extended support for Microsoft Dynamics NAV have generally ended (which reached end of life). The only exception is that extended support (providing only security updates) for NAV 2018 ends on January 11, 2028.
Microsoft GP is also being phased out. End of regular support for Microsoft Dynamics GP is on December 31, 2029, and security updates will end in extended support on April 30, 2031. Microsoft ended issuing new perpetual licenses for Dynamics GP on April 1, 2025, and is ending new GP subscription licenses on April 1, 2026.
Microsoft recommends migrating legacy systems, such as NAV and GP, to its more recent solutions, in a cloud migration to Microsoft Dynamics 365 Business Central or Microsoft Dynamics 365 Finance and Operations.
Pro Tip: Finance teams often modernize AP automation and global payouts alongside their Microsoft Dynamics migration to reduce post-go-live friction and ensure controls are in place from day one.
Microsoft Dynamics Migration vs. Re-Implementation: How to Decide
The decision between migrating to Microsoft Dynamics 365 and implementing a new system is a planning decision your business must make. What’s the distinction between migration and re-implementation?
In a Microsoft Dynamics migration, your business transfers its existing data, configurations, and processes to a new ERP, enabling a faster, simpler change at a lower implementation cost. It preserves history, but doesn’t change processes to optimize the new system.
As an alternative, your business should consider the long-term benefits of re-implementation using cleaned data, archiving some historical data, and adopting best-in-class practices with streamlined workflows.
Deciding between migration and re-implementation depends on your new system’s expectations for timing, efficiency, and results, as well as your company’s migration/implementation budget.
Migration vs. Re-implementation Issues
Organizations evaluating ERP transitions must determine whether a technical migration is sufficient—or whether a full reimplementation better supports long-term scalability and control.
Consider these issues for migration vs. re-implementation decisions:
- Technical upgrade vs fresh implementation
- Data carryover tradeoffs
- Cost implications
- Timeline differences
- When re-implementation reduces technical debt
- Reporting and integration considerations
Technical Upgrade Vs Fresh Implementation
In a technical upgrade, you upgrade to a new version of your existing software. In contrast, a fresh implementation involves implementing an entirely new system after cleaning data for data migration, improving processes, changing configurations, and ensuring best practices.
Data Carryover Tradeoffs
Data carryover tradeoffs consist of:
- Enhancing system speed and efficiency with less transferred historical data, OR
- Having all historical data readily accessible in the system. without the need to access archived records
Selecting a reasonable number of years for historical data migration may be the best solution.
Re-implementation to Reduce Technical Debt
Very old, legacy systems cost a lot of money to maintain. There is a break-even point at which it costs less to migrate to a new ERP system than to maintain code, perform updates with a large IT staff, buy new hardware, and retain or modify other system elements. Additionally, old systems aren’t as efficient as modern cloud systems.
Table: Decision Matrix Considerations
This table summarizes ERP migration vs. re-implementation considerations.
| Cost implications | Time Implications | System Efficiency |
|---|---|---|
| Cost of new system vs maintaining old | Implementation time vs. system maintenance time | New system increases speed, efficiency, and scalability |
| Upgrade vs fresh implementation | Longer for a fresh system (re-implementation) | Best practices, streamlined processes |
| Data migration considerations | Time required to clean and archive data | Clean data, fewer slowdowns; archived data access |
Key Challenges in Microsoft Dynamics Migration (and How to Address Them)
Consider these key challenges in migrating to Microsoft Dynamics. Addressing these challenges requires structured risk mitigation to protect data integrity and reduce operational disruption during go-live.
ERP Migration Data Integrity Risks
Data integrity risks include:
- Vendor master inconsistencies
- Duplicate records
- Historical data mapping issues
- Broken GL hierarchies
- Inconsistent chart of accounts
Using the right data migration iPaaS and integration tools will help you address these data integrity issues.
Vendor Master Inconsistencies, Duplicate Records, and Chart of Accounts
Before your Microsoft Dynamics data migration or re-implementation, schedule enough time to thoroughly clean your data, including vendor master files and transaction data. Remove duplicate and erroneous records, and clean up the chart of accounts to align with the new system.
Data Mapping Issues
Properly map data to fields and include desired entities in the new system to help ensure that data migration goes smoothly and the new system is properly implemented. When your company conducts data mapping, include mappings for entities, vendors, and the general ledger.
General Ledger Hierarchies
Test and correct general ledger hierarchies through a pre-migration review and trial balance review after data migration, but before Go Live.
ERP Migration Operational Risks
Operational risks include:
- Integration failures (CRM, payroll, AP, BI tools)
- Reporting gaps post-migration
- Multi-entity complexity
- Currency and tax configuration mismatches
Your business must ensure that all software add-ons integrate seamlessly into a unified system and address key challenges, including multi-entity complexity and currency and tax configuration. You’ll need to test for post-migration reporting gaps during the planning stage, after data migration, and before going live, so your migration team can make any necessary corrections to the system implementation.
ERP Migration Go-Live Risks
Go-Live risks include:
- Incomplete reconciliation
- Historical data inaccessible
- Cutover posting delays
- Manual AP bottlenecks
Plan thoroughly before beginning the migration to address these risk areas and minimize the risk of system disruptions. Ensure that all necessary account reconciliations are completed before going live. Review your currency and tax configurations to detect any missed items or mismatches.
Tipalti performs instant automated payment reconciliations that can be run in a safe sandbox test environment before going live.
Minimizing the risk of go-live mistakes is essential. Go-live mistakes can delay sales invoicing and payments, impairing customer and supplier relationships. They can lead to inaccurate reporting, making it difficult to run your business effectively.
Automating AP and global payments improves ERP migration
Explore best practices for integrated Microsoft Dynamics migration with a 90-day playbook for automated global payables.
Microsoft Dynamics Migration Checklist: From Planning to Go-Live
This Microsoft Dynamics migration checklist outlines the key steps for the pre-migration, migration, and post-migration phases. Your Microsoft Dynamics migration consultant will provide a more detailed checklist customized for your unique business needs.
Pre-Migration Phase
- Define migration type
- Stakeholder alignment: IT, Finance, AP, BI, Compliance
- Conduct a full data audit and cleansing:
- Vendors
- Open invoices
- Tax IDs
- Historical transactions
- Chart of accounts
- Document integrations and dependencies
- Define a historical data retention strategy
- Evaluate migration tools and implementation partners
When defining the migration type, document whether it’s from Microsoft NAV to Business Central or from Microsoft GP to MS Dynamics 365 Finance. Another option is to migrate from a different ERP brand to Microsoft Dynamics.
During Migration
- Build timeline and cutover plan
- Run sandbox simulations of finance workflows
- Validate vendor and master data mapping
- Test reporting outputs
- Validate AP and payment workflows
- Reconcile open balances
- Conduct user acceptance testing (UAT)
Post-Migration
- Parallel reporting validation
- Reconcile sub-ledgers to GL
- Confirm integration stability
- Monitor financial close cycles
- Implement change management and training
About Pre-Migration
During the Pre-Migration phase, your business appoints a cross-functional team, aligns the team, makes planning decisions, selects its Microsoft Dynamics 365 integrations and tools, and chooses consulting partners. Assigning a timeline with responsibilities for task completion is essential.
Train the implementation team on migration practices and on using the new Microsoft Dynamics ERP and integrated add-ons. Decide when to train functional users who aren’t on the Microsoft Dynamics implementation team or related integrations team.
During Pre-Migration, perform a complete data audit. Decide how much historical data to transfer to the new system. Limiting the time period for historical data migration will help speed up your new system. Define a historical data retention strategy.
Focus on cleaning transaction and master file data to ensure the new system has data integrity.
ETL (Extract, Transform, Load) is a data science term that applies (beyond its use in training and using AI models) to ERP system data migration. Your implementation team needs to obtain (extract) data from various sources, such as siloed systems. Then it will transform system data by cleaning and properly formatting it, and validate the data before loading it into your new ERP system.
About Migration
Migration can be challenging for employees who must keep up with their current workload while also meeting the demands of the migration project. Continue coaching employees on the benefits of the new Microsoft Dynamics system and on how to manage change effectively.
During the Migration process, practice the scheduled cutover multiple times in a sandbox environment and review test results to get it right when the system goes live.
At cutover, data migration must be validated, accurate, and complete. Mapping must be accurate. User acceptance testing must ensure that the system is ready for each functional area and general use. It must produce results that will prevent disruptions to system use and delayed or inaccurate reports.
This is the time to test accounts payable, payment, and payout workflows. Perform or automate necessary reconciliations.
About Post-Migration
When starting the Post-Migration phase of system implementation, run the old and new ERP systems in parallel, including integrations, to ensure results are accurate and comparable. Complete hands-on employee training.
Document what went well in the migration process and issues that could be improved when conducting future system implementations. Hold a final all-employees meeting (led by the CEO and executive management) to announce the launch of the new Microsoft Dynamics 365 system and to increase change-management motivation and commitment.
Maintain ongoing data governance with the new system to ensure data integrity and proper data management throughout the data lifecycle. Implement your historical data retention policy when it’s time to offload data from the system to retain its speed and efficiency.
Microsoft Dynamics Migration Costs: What to Expect
Prepare a budget for your Microsoft Dynamics migration after performing research and obtaining quotes. Consider each type of software you’ll need in your Microsoft Dynamics 365 integration.
Before migrating to another ERP system with third-party integrations, obtain pricing lists or custom quotes for a unified software system that likely includes most of these options:
- Microsoft Dynamics ERP modules for unified business applications (with each type of functionality needed)
- MS Dynamics CRM integration (or third-party CRM)
- Microsoft software or apps
- Microsoft 365/Office 365 apps
- Excel
- Word
- PowerPoint
- SharePoint
- Outlook
- Power Platform (low-code tools)
- Power BI
- Power Apps (a developer platform to build custom apps)
- Power Automate (process automation)
- Power Pages (external-facing website pages)
- Underlying Data Connectors, AI Builder, and Dataverse (with standard and custom tables)
- Copilot (AI-powered assistant)
- Microsoft Fabric
- Azure cloud
- Microsoft 365/Office 365 apps
- Partner/consultant integration costs
- Third-party add-ons
For example, how much does it cost to migrate from NAV to Business Central?
For a Microsoft NAV to Business Central migration, consider:
- Licensing changes (on-premise vs cloud subscription)
- Data migration complexity
- Customization rebuild costs
- Integration rebuild
- Implementation partner fees
- Internal resource allocation
- Ongoing support costs
Estimated Migration Costs: Microsoft GP/NAV to BC
| Small Business Estimated Migration Cost | Midsize to Large Company Estimated Migration Cost | |
|---|---|---|
| Low customization | $20,000 | $50,000 |
| Highly customized system | $50,000+ | $100,000+ |
| Dynamics 365 Business Central SaaS plan license | Essentials: $80/user/month Premium: $110/user/month | Essentials: $80/user/month Premium: $110/user/month |
| Integrated Microsoft software apps | Look for Microsoft pricing plans/quote | Look for Microsoft pricing plans/quote |
| Migration tools and third-party add-ons | Obtain custom quotes | Obtain custom quotes |
*Estimates vary by complexity, customization, and geography
Choosing the Right Microsoft Dynamics Migration Tools and Partners
When preparing and executing a Microsoft Dynamics migration plan, choose efficient software tools that transfer clean, accurate, and reliable data to the new system to ensure data integrity. Your business also needs to select experienced consulting partners who have completed many successful migration services projects for their customers.
Microsoft Dynamics Finance and Operations migration tools differ from those for Business Central.
Native Microsoft Dynamics 365 Data Migration Tools
Native Microsoft tools for ERP migration include:
- Data Migration Framework (DMF)
- RapidStart Services
- Configuration Packages
- API-based data migration tools
- Azure-based migration utilities
Data Migration Framework
Microsoft’s Data Migration Framework (DMF) is designed to support migrations to Dynamics 365 Finance and Operations (D365 F&O). DMF manages data entities and data entity packages. The Data Migration Framework is used for data migration, configuration setup/copying, and integration.
With DMF, your implementation team can migrate reference, master, and document data from other systems to F&O. The framework lets you copy configurations for each company or environment, migrate selected entities, and configure processes or modules using Microsoft Dynamics Lifecycle Services (LCS). DMF handles large data volumes in the data migration process.
Native Business Central Migration Tools
Business Central migration tools include RapidStart Services, Configuration Packages, and API-based data migration tools. For API-based data migration, you can also choose third-party data migration tools when migrating from GP or NAV to Business Central.
RapidStart Services Configuration Packages are native data migration tools for Microsoft Dynamics 365 Business Central. They configure a new tenant with Excel templates to import vendor, customer, and item master data and automatically set up the Chart of Accounts and posting groups.
Configuration packages include data validation and field mapping to the new system. These configuration packages can be reused for different customers or other similar applications.
Azure Database Migration Service
When planning an ERP migration, you may want to automatically migrate your databases to the Azure cloud using the Azure Database Migration Service (ADMS). Azure Database Migration Service is a tool that helps you simplify, guide, and automate your database migration to Azure at scale. This ADMS tool migrates your multi-sourced data, schema, and objects to the Azure cloud.
Azure is also available as a private cloud (using Azure Stack) and in a hybrid configuration, with customers running on-premises solutions for services and connecting to the Azure public cloud.
If you decide to use Microsoft Fabric as your AI-powered, unified data analysis platform, with One Lake for your centralized data lake, it uses Microsoft’s managed cloud service, Azure Data Factory, to handle big data management and provide business intelligence. Microsoft Fabric also integrates Microsoft’s Power BI software for data analysis and visualization, providing business intelligence insights.
iPaaS and Integration Tools
iPaaS (Integration Platform as a Service) and other integration tools include:
- Boomi
- Celigo
- MuleSoft
- Power Platform integrations
Boomi, Celigo, and MuleSoft (owned by Salesforce) are competing iPaaS tools used by mid-size to large companies for data migration. Celigo offers a relatively easy-to-use experience for midsize companies, whereas Boomi and MuleSoft excel at handling large, complex integrations.
These iPaaS companies provide pre-built Microsoft Dynamics connectors for Dynamics 365 Finance and Operations, Business Central, and Dynamics 365 CRM (or Salesforce). More complex companies can use their IT staff to modify the API code produced by an iPaaS.
Microsoft Power Platform has over 1,400 prebuilt connectors compatible with Microsoft Dynamics. Power Platform uses Microsoft Dataverse and Power Automate (cloud flow connectors) for low-code app integration, workflow automation, and data synchronization.
Choosing Qualified Implementation Partners
Your business needs to choose Microsoft-certified implementation partners for migrating to Microsoft Dynamics. It may also need knowledgeable consultants specializing in some third-party Microsoft Dynamics 365 integrations. Microsoft partners and consultants can also provide essential end-user training to improve user adoption and system use.
Implementation partner criteria to consider are:
- Business Central / D365 certification
- Multi-entity experience
- Finance transformation expertise
- Migration accelerators
- Industry specialization
Migration accelerators speed up the migration process by using a proven framework, tools, prebuilt Microsoft Dynamics connectors, and services to accelerate new system implementation.
Avoiding Common Microsoft Dynamics Go-Live Mistakes
To improve your Microsoft Dynamics migration results, reduce time overruns and errors, and minimize system disruptions, plan to avoid these common migration mistakes before Go-Live. Adequate planning and execution will help your company achieve a smooth transition, with fewer stumbles.
Common mistakes for Microsoft Dynamics Go-Live include:
- Incomplete UAT (user acceptance testing)
- Ignoring reporting validation
- Poor change management
- Over-customization during migration
- Delaying AP workflow testing
- Not validating integrations early
How Tipalti Supports Microsoft Dynamics Migrations
Tipalti is a support layer that enhances Microsoft Dynamics through integration. It’s not an ERP replacement. Tipalti stabilizes payables workflows during ERP transitions, preventing AP backlogs and preserving financial controls through go-live.
Tipalti’s Accounts Payable and Mass Payments products provide:
- Pre-built Microsoft Dynamics connectors
- Vendor onboarding automation
- Intelligent invoice capture
- Global mass payments
- Tax ID validation, W8/W9, VAT
- Multi-entity reporting
- Real-time reconciliation
- Compliance controls
Supplier and Payee Onboarding
Tipalti AP and Mass Payments software provide a white-branded Supplier Hub to onboard vendors and payees receiving payouts. Through the portal, suppliers or payees submit data to complete W-9 or W-8 forms (including their contact information and Tax ID) and provide their preferred payment method and payment details. Tipalti automatically performs TIN matching as validation.
AI Agents and AI Assistant
Tipalti uses AI agents, an AI assistant, and custom reports to perform payables workflows and help your company analyze its multi-entity spend for better control and informed decision-making.
Global Regulatory Compliance and Tax Compliance
Before making global payments, Tipalti automates regulatory compliance by screening against sanctions lists, including OFAC, as well as other blacklists.
Tipalti tracks payments for 1099-MISC, 1099-NEC, and 1042-S information returns. It provides a simple tax preparation report and integrates with partnered ZenWork Tax1099 software for optional e-filing (with a Tax1099 SaaS subscription and per-1099 fee).
Multi-entity Reporting
Tipalti is a multi-entity software that provides entity-level reporting and combined views. Tipalti is scalable to handle your business expansion and the complexities of multinational operations.
Real-Time Payment Reconciliation
Real-time payment reconciliation is performed for every batch payment (that contains multiple currencies and payment methods).
Financial Controls
Tipalti improves financial controls to reduce payment errors and offers behavioral fraud-detection software, Tipalti Detect®. Tipalti uses 26,000+ automated payment rules to flag exceptions. It also provides an audit trail and enterprise-grade software for stronger controls.
Maximize the Value of Your Microsoft Dynamics Investment with Tipalti
Your growing, multi-entity organization can automate payables, strengthen financial controls, ensure compliance, and scale efficiently with Tipalti finance automation.
