Here on the Orange Rag (and the Insider newsletter) we're firm believers that one of the big trends* over the next 5 years will be the emergence of Microsoft as a major player in the legal systems space. Sure, Microsoft aren't going to launch their own legal-specific PMS product – but their Dynamics software is likely to feature as a major component in many new legal market applications. Here's the latest from Redmond:

…Building on the Microsoft Dynamics enterprise resource planning (ERP) strategy to drive industry-specific innovation for customers and enable partners to deliver repeatable, vertical solutions, Microsoft today announced the acquisition of four industry solutions that will extend the core capabilities of one of Microsoft’s ERP products, Microsoft Dynamics AX. This move supports Microsoft’s promise to enable the Dynamic Business, which includes offering flexible business applications that remain relevant as business needs evolve.
 
“With these acquisitions we are investing in building industry functionality directly into the Microsoft Dynamics AX application, while other ERP vendors are cutting corners or trying to reconcile multiple industry offerings as a result of acquiring several companies,” said Crispin Read, general manager of Microsoft Dynamics ERP. “We are a safe haven for customers and partners who depend on us to drive continuous innovation in our products and lower the total cost of ownership.”
 
The following acquired technology will be offered as part of Microsoft Dynamics AX, which will give partners the opportunity to drive deeper vertical solutions for customers in manufacturing, professional services and retail.
 
• A process manufacturing solution acquired from Fullscope Inc., which provides tight integration of business processes across discrete manufacturing and process manufacturing
• A professional service solution acquired from Computer Generated Solutions Inc, which delivers a single system to manage projects and resources, execute financial transactions and customer billing, and match resources with client assignments
• Retail solutions from LS Retail EHF and To-Increase Denmark A/S, a wholly owned subsidiary of Columbus IT Partner A/S, that enable Microsoft to provide an end-to-end retail solution including store management with point-of-sale, merchandising and ERP capabilities
 
With these technology acquisitions Microsoft is providing core industry functionality embedded into Microsoft Dynamics ERP applications, allowing partners to focus on the last mile of innovation, which has been shown to have the greatest impact on a customer’s business. In fact IDC research shows that Microsoft Dynamics ERP partners with vertical focus outperform those without in several key areas including higher overall customer growth, a higher proportion of revenue from new customers, larger deal sizes, and a trend toward higher operating profit margins. 

This is what Microsoft's legal market team had to say about the acquisitions: “With law firms around the world striving to strike a balance between becoming more competitive and doing more with less, this news will be of particular interest to them. Microsoft Dynamic’s acquisition features the type of technology that is critical for law firms today: solutions that enable them to better address business processes, operational costs, workforce effectiveness and customer retention. The acquired solutions are more nimble, adaptable and drive faster time to innovation which differentiates Microsoft from other competitors who are reconciling multiple industry offerings as a result of acquiring several companies.”
 
• Process manufacturing and professional services solutions for Microsoft Dynamics AX are available immediately on the Microsoft Dynamics price list, and the retail solution will be available at a later date. Microsoft will provide updates to customers and partners as the availability date approaches. More information on Microsoft Dynamics ERP solutions, and details on the new industry functionality in Microsoft Dynamics AX, can be found at www.microsoft.com/dynamics/en/us/products/ax-overview.aspx

* You can read more predictions about future trends in legal technology in Charles Christian's upcoming new book Legal Practice in a Brave New World – scheduled for publication in the spring of 2010.