Leveraging Power Platform Add-Ons: Cost Considerations for Dynamics 365 F&O
Last month, I had a rather uncomfortable meeting with a client's CFO who had just received their quarterly Microsoft bill. "Nick," she said, sliding the invoice across the table, "can you explain why we're suddenly paying an extra $21,000 for something called 'Power Platform'? I thought this was included with our Dynamics licences."
It's a conversation I'm having more frequently these days. The Power Platform ecosystem - Power BI, Power Automate, Power Apps, and Power Virtual Agents - offers tremendous value alongside Dynamics 365 F&O, but the licensing model is, to put it mildly, a labyrinth that's constantly shifting under your feet.
Having guided dozens of organisations through these waters, I've developed some pragmatic approaches to maximise value while avoiding the surprise charges that seem to be catching even sophisticated finance teams off guard. Let me share what I've learned the hard way.
It's a conversation I'm having more frequently these days. The Power Platform ecosystem - Power BI, Power Automate, Power Apps, and Power Virtual Agents - offers tremendous value alongside Dynamics 365 F&O, but the licensing model is, to put it mildly, a labyrinth that's constantly shifting under your feet.
Having guided dozens of organisations through these waters, I've developed some pragmatic approaches to maximise value while avoiding the surprise charges that seem to be catching even sophisticated finance teams off guard. Let me share what I've learned the hard way.
Understanding the Power Platform Ecosystem Within D365
First, let me clarify something that Microsoft's own sales teams sometimes misrepresent: the relationship between Dynamics 365 F&O and the Power Platform components.
Your Dynamics 365 F&O licences do include some Power Platform capabilities - but with significant limitations that aren't always obvious until you've exceeded them. This is typically where those surprise charges originate.
Here's what you actually get with standard D365 F&O licences:
Your Dynamics 365 F&O licences do include some Power Platform capabilities - but with significant limitations that aren't always obvious until you've exceeded them. This is typically where those surprise charges originate.
Here's what you actually get with standard D365 F&O licences:
Power BI:
- Basic embedded dashboards within D365
- Limited Power BI Pro capabilities (for direct D365 data only)
Power Automate (formerly Flow):
- 2,000 runs per month per tenant (not per user!)
- Only for automations directly connected to D365 data
- Limited to "standard" connectors
Power Apps:
- Model-driven apps directly tied to D365 data
- 2 custom applications per user
- Limited to standard connectors
I recently worked with a manufacturing client who thought they were fully covered for their automation needs, only to discover they'd surpassed their Power Automate limits within the first week of the month - resulting in an unexpected $4,800 charge on their next bill.
The "Seductive Slippery Slope" of Power Platform Adoption
What makes this particularly challenging is what I call the "seductive slippery slope" of Power Platform adoption.
It typically follows this pattern:
It typically follows this pattern:
Team begins with simple automations using the included capabilities
Early success drives more ambitious projects
Usage gradually exceeds included limits
Premium connectors suddenly become necessary
Monthly bill arrives with unexpected charges
This isn't accidental. Microsoft's strategy - and look, I understand the business logic - is to demonstrate value before presenting the full bill. The problem is that many organisations dive in without clearly understanding where those boundaries lie.
As one CIO I work with put it: "It felt like we were given a free entrée, but when the main course arrived, we discovered we'd somehow ordered the most expensive item on the menu."
As one CIO I work with put it: "It felt like we were given a free entrée, but when the main course arrived, we discovered we'd somehow ordered the most expensive item on the menu."
Breaking Down the Real Costs: Beyond the Sticker Price
Let's get specific about what these add-ons actually cost when you exceed the included capabilities:
Power BI Licensing Options:
- Power BI Pro: $15/user/month
- Power BI Premium Per User (PPU): $30/user/month
- Power BI Premium Per Capacity (P1): Starting at $7,475/month per capacity
Power Automate Costs:
- Per User Plan: $20.60/user/month
- Per Flow Plan: $137.30/month for 5 flows
- Process Advisor: $15/user/month
- Attended RPA: $60/user/month
- Unattended RPA: $225/bot/month
Power Apps Pricing:
- Per App Plan: $14/user/app/month
- Per User Plan: $31.40/user/month
- Pay-as-you-go: $15/active user/app/month
Premium Connector Fees:
- Vary by connector, but typically require the per-user plans above
I'm not sharing these figures to discourage adoption - quite the opposite. The Power Platform can deliver extraordinary ROI when deployed strategically. But walking in with eyes wide open about costs is essential.
Cost-Benefit Analysis: When Do Add-Ons Make Financial Sense?
After helping organisations of various sizes optimise their Power Platform investments, I've identified some benchmarks for when additional licensing makes financial sense:
Power BI Premium Justification
A mid-sized distributor I advised was considering Power BI Premium capacity at nearly $7,500/month - a significant investment. We conducted a thorough analysis and found the upgrade justified when:
- They needed to refresh data more than 8 times daily
- 60+ users required report access
- Security requirements demanded row-level security across large datasets
- Report embedding in customer-facing portals was essential
Power Automate Premium ROI
For another client in the professional services sector, we calculated the ROI on Premium connectors for Power Automate:
Scenario Analysis:
Scenario Analysis:
- Manual process cost: ~$95,000 annually (based on labour hours)
- Automation development: ~$21,000 (one-time)
- Premium connector licensing: $13,500 annually
- Net first-year savings: $60,500
- Subsequent annual savings: $81,500
The "Connector Trap": A Particular Pain Point
One aspect that repeatedly blindsides organisations is what I call the "connector trap." Here's how it typically unfolds:
A team creates a flow using standard connectors, which are included with D365. Everything works fine for months. Then, a critical business need requires connecting to a third-party system - perhaps Salesforce, DocuSign, or even Adobe. Suddenly, these flows require premium connectors, which in turn require premium licences.
I watched an insurance client unexpectedly incur nearly $27,000 in additional annual costs when they added a single connection to a legacy claims system. Had they planned this from the outset, they could have structured their automation strategy differently, potentially saving thousands.
A team creates a flow using standard connectors, which are included with D365. Everything works fine for months. Then, a critical business need requires connecting to a third-party system - perhaps Salesforce, DocuSign, or even Adobe. Suddenly, these flows require premium connectors, which in turn require premium licences.
I watched an insurance client unexpectedly incur nearly $27,000 in additional annual costs when they added a single connection to a legacy claims system. Had they planned this from the outset, they could have structured their automation strategy differently, potentially saving thousands.
Strategic Approaches to Optimise Your Power Platform Investment
Based on my experience with dozens of organisations, here are the strategies that consistently deliver the best results:
Conduct a Thorough Licence Inventory and Forecast
Before expanding your Power Platform footprint:
- Document current licence entitlements
- Inventory all existing automations, reports, and apps
- Project growth over 12-24 months
- Identify potential premium connector requirements
This may sound tedious - and honestly, it can be - but I've never seen an organisation regret this investment of time. The visibility it provides is invaluable for avoiding surprise charges.
Consider Licence Pooling Strategies
Not every user needs the same level of licensing. Consider these approaches:
- Power BI: Instead of Pro licences for everyone, identify report consumers vs. creators
- Power Automate: Consider flow-based licensing for department-wide automations
- Power Apps: Use per-app licences for occasional users
A healthcare provider I worked with reduced their projected Power Platform costs by 42% through strategic licence pooling alone.
Develop a Governance Framework with Cost Controls
Establish clear guidelines around:
- Who can create new Power Platform solutions
- Approval processes for premium connector usage
- Regular usage monitoring and cost reviews
- Licence reassignment protocols for departing employees
Without governance, costs inevitably spiral. One manufacturing client discovered they were paying for 47 Power BI Pro licences for employees who had left the company - a $705 monthly leak that had persisted for over a year.
Consolidate Workloads to Maximise Licence Value
Rather than treating each Power Platform component separately, look for opportunities to consolidate:
- Power Apps can often display Power BI dashboards
- A single premium connector licence can serve multiple automation needs
- Shared dashboards can eliminate duplicate report development
A retail client reduced their licensing costs by 23% simply by consolidating their automation workloads more efficiently.
Real-World Cost-Benefit Analysis: By Company Size
Let me share typical scenarios I've encountered across different organisation sizes:
Small Business (50-100 employees)
Current state:
- D365 Business Central
- 5 power users creating reports and automations
- 25 information consumers
- Monthly Power Platform spend: $1,875
Optimised approach:
- 2 Power BI Premium Per User licences ($60)
- 3 Power BI Pro licences ($45)
- 25 report viewers using free licences ($0)
- 1 Power Automate Per User licence ($20.60)
- 4 Per App licences ($56)
- Revised monthly spend: $181.60
- Annual savings: $20,320
Mid-Market (100-500 employees)
Current state:
- D365 F&O
- Each department building their own solutions
- Everyone with Pro licences "just in case"
- 80 Power BI Pro licences ($1,200)
- 40 Power Automate per user licences ($824)
- Monthly Power Platform spend: $2,024
Optimised approach:
- Power BI Premium capacity: $7,475
- 15 Power Automate per user licences: $309
- 10 Per Flow licences: $1,373
- Revised monthly spend: $9,157
- Additional capabilities gained: Embedded analytics, unlimited report distribution, AI capabilities, increased refresh rates
- Value analysis: Despite higher cost, delivered 3.2x ROI through expanded capabilities and elimination of development redundancies
Enterprise (500+ employees)
Current scenario:
- Global D365 F&O implementation
- Multiple divisions with varying needs
- Decentralised Power Platform purchasing
- Monthly spend: $57,000
- Significant redundancy in solutions
- Licensing compliance risks
Optimised approach:
- Centralised Power Platform Centre of Excellence
- Negotiated Enterprise-wide agreement
- Implemented usage-based chargebacks to departments
- Revised monthly spend: $39,600
- Annual savings: $208,800
- Additional benefits: Improved governance, reduced compliance risk, eliminated redundant development
Use Best Practices That Reduce Licensing Costs
Beyond licensing strategies, certain usage patterns can dramatically reduce your Power Platform costs:
Batch Processing vs. Individual Automation
One manufacturer was running a Power Automate flow for each sales order - exceeding their included runs within days.
By redesigning their approach to process orders in batches, they reduced their automation runs by 87% and eliminated the need for additional licensing entirely.
By redesigning their approach to process orders in batches, they reduced their automation runs by 87% and eliminated the need for additional licensing entirely.
Report Architecture Optimisation
A common mistake is building Power BI reports that refresh data for each user interaction.
By restructuring reports to use shared datasets with scheduled refreshes, one financial services client reduced their data refresh requirements by 94%, avoiding the need for Premium capacity.
By restructuring reports to use shared datasets with scheduled refreshes, one financial services client reduced their data refresh requirements by 94%, avoiding the need for Premium capacity.
Strategic Connector Selection
Not all premium connectors are created equal. Whenever possible:
- Use standard connectors (HTTP, Excel, SharePoint)
- Consider whether batched API calls could replace direct database connections
- Explore whether logic can be moved inside D365 (using standard workflows)
Develop vs. Licence Calculation
Sometimes it's more cost-effective to develop custom APIs that use standard connectors rather than paying for premium connectors indefinitely.
One client saved approximately $18,000 annually by investing $12,750 in custom API development - breaking even in just 8.5 months.
One client saved approximately $18,000 annually by investing $12,750 in custom API development - breaking even in just 8.5 months.
My Practical Recommendations: A Tiered Approach
If you take away nothing else from this post, consider this tiered approach I've refined through dozens of implementations:
Tier 1: Start with Included Capabilities
- Begin by fully leveraging what's included with your D365 licences
- Document requirements that can't be met with included capabilities
- Establish governance before expanding
Tier 2: Targeted Premium Investments
- Identify high-value use cases for premium features
- Calculate ROI before purchasing
- Start with limited licences to validate value
Tier 3: Strategic Enterprise Adoption
- Negotiate enterprise-wide agreements once value is proven
- Implement chargeback mechanisms to departments
- Establish a Centre of Excellence for shared development resources
Final Thoughts: The Balance of Cost and Innovation
There's a balance to strike here. On one hand, costs need careful management. On the other, the innovation potential of the Power Platform is tremendous. I've watched companies transform their operations through thoughtful application of these tools.
The organisations that succeed most impressively are those that approach the Power Platform with both eyes open - understanding the licensing implications, but not allowing those considerations to stifle innovation completely.
As with most things in business technology, it comes down to informed strategy rather than reactionary decision-making. By understanding the true costs, planning accordingly, and implementing strong governance, you can harness the Power Platform's capabilities without the unexpected invoice surprises that have become all too common.
The organisations that succeed most impressively are those that approach the Power Platform with both eyes open - understanding the licensing implications, but not allowing those considerations to stifle innovation completely.
As with most things in business technology, it comes down to informed strategy rather than reactionary decision-making. By understanding the true costs, planning accordingly, and implementing strong governance, you can harness the Power Platform's capabilities without the unexpected invoice surprises that have become all too common.