Power Platform | When a single app thinking isn´t enough

Today, I´d like to reflect on licensing- , well actual pricing discussions again. Those, here and there to be found on social media regarding the Power Platform. In many cases those discussions kick-off by someone complaining around the fact of being forced to re-engineer a solution, based on the fact of data sources being used for the app scenario forcing a high cost.

The pattern in many cases follows this: „I am frustrated of the Power Platform licensing, due to forcing us to a pricing that in no circumstances can be accepted for using Common Data Service as app data source“. I am not going to add additional attributes used to show the level of frustration.

When reading this, I am always reminded of my day-to-day life, where in press or news we´re discussing the price of food. Is it okay in times of Corona to raise the price of fruits and vegetables? Do we need to raise the price of meat, to allow for better working conditions and avoid current ongoing practices to produce meat as low as possible – as the argument is called out as „the market would demand it“?

Well, I don´t want to further discuss this topic here, but explicitly outline, that pricing might not be the point to discuss. Instead, we should think of a value in total discussion.

In other words, a single app might not be sufficient to explain the overall value, your company would receive when making a buy-in to Power Platform. Why is this?

In my value talks, I am referring to a price-point discussion being like finding a needle in a haystack – Let´s say an actual app scenario would safe a front-line worker 15 mins each day for a specific process; year 2020 will be calculated as 254 working days; a possible saving of 3.810 mins or 63.5 hours or ~2.65 days would be possible. Let´s assume, we´re calculating this with 125 USD/day salary, our saving per front-line worker could be worth ~331 USD/yr.

If we compare this to current known list pricing of 10 USD per App or 40 USD per User pricing per month for Power Apps (and yes, this is what happens though there´re multiple more license options), we could do the math and compare our ~331 USD/yr with an investment of 120 USD/yr or 480 USD/yr. In other words, selecting the per App licensing model, a single scenario like this could save us money; choosing per User licensing model instead, our investment will be higher than our possible revenue.

This is why I´m calling this „finding a needle in a haystack“. If you can´t find this single app scenario, you probably have a tight discussion ongoing around pricing. Same tough discussion you would have, if you would compare this to meat-, vegetables, or milk pricing and not turning this into a value discussion as well.

In my value talks, I am therefore trying to shape the scope and turn discussion to something that is often-times overlooked in for instance Power Apps licensing. What is it, you ask? If you check out current Power Apps pricing page for per App it says: „Run applications around a single business scenario for an individual user“ and if we deep dive in the matrix the single business scenario is outlined as 2 apps and 1 portal.
Regarding per User licensing the page talks about: „Run unlimited applications for multiple business scenarios.“

What do both of them have in common? They are talking about more than a single app. Therefore a value talk should start by discovering a broader app requirement. What would be, if we can take into account >1 app scenario?

Let´s assume additional to above app scenario, we could identify another scenario where a Power Automate flow in context would be involved. By automating the task via the flow, instead of letting the first-line worker do the task manually, we´re saving this worker another 5 mins each day. Our calculation would be 5 * 254 = 1.270 mins/yr or ~21.17 hours or 0.88 days. Again with a 125 USD/day salary, our saving per front-line worker could be worth additional ~110 USD/yr.

As you can see, we´re getting closer and closer to our 480 USD/yr investment of a per User license. Of course this is very simplified calculation and there´re many more aspects of cost-savings that needs to be taking into account. But same as you shouldn´t think of from an investment point the license cost being the single point of truth. What about the development & maintenance costs of an app? If you´re interested in understanding industry standard economic impact calculation, I recommend you taking a look into the Total Economic Impact of Power Apps study by Forrester.

My point is, Power Platform licensing for all its modules (Power BI, Power Apps, Power Automate, Power Virtual Agents or the add-ons) is based on the fact of making a buy-in to a low-code platform for digital transformation. For IT departments or pro-developers, it is about buy-in to a tandem development strategy to both provide low-code platform services to citizen developers as well as accepting low-code being an alternative to their traditional development tools.

A single app might not be worth driving a discussion of a low-code platform being used for digital transformation. But neither should selecting a data source or re-engineering an app scenario to fit a specific licensing option be your tour-guidance when thinking of the Power Platform as a digital transformation toolset for your company.

If you´re interested in getting behind the scene´s on this, please check out my 4-part series around why I do think a paradigm shift is needed.

1. Episode I
2. Episode II
3. Episode III
4. Episode IV

Agree, Disagree, additional thoughts? Let me know your thoughts via comments or via Twitter.

Until then…