Tyler Technologies lays the foundation for its future with Dynamics 365

A new vision brings the need for change

Historically, Tyler operated as a holding company with multiple divisions specializing in public sector services. As companies joined the family through acquisition and became divisions themselves, they typically brought with them existing internal operational software solutions that had worked well in isolation but didn’t interface well with the ERP system that corporate headquarters used. That system was an on-premises version of Epicor which had been running for a decade and was built on a structure that made new integrations challenging. The company also used NetSuite and two older versions of Microsoft Dynamics applications. As Nicole Teal, Corporate Controller, explains, “We had a company managing itself eight different ways and needed something transformative to bring us all together, speaking the same language and working from the same data.”

In 2019, leadership moved to a “One Tyler” approach to bring all divisions together on a shared technology platform, working from a single data source. The transformation that Teal described would help the business run more efficiently and support the fast-growing company’s vision of becoming a one-stop-shop for public sector organizations.

Incremental change allows for operational upgrades

Tyler leadership understood the undertaking represented a significant change. Many employees had worked on the same systems for years and knew them inside out. “The process of transitioning from a system you have been on for many years to a new, more innovative one can be tough,” explained Betsy Kirchenbauer, Director of Accounting for Tyler. So, to ease the transition, leadership chose to take an incremental approach. And in the end, employees appreciated “increased visibility, shared knowledge, and agility. It also heightened the ability to collaborate with other departments,” added Kirchenbauer. Employees looked forward to solving persistent issues associated with the company’s dispersed finance and operations software and systems.

• A lack of flexibility and scalability made integrating new acquisitions and lines of business challenging.
• With limited data elements and dimensionality, capturing and reporting key financial information for timely business decisions was more difficult.
• P&L tracking and insights for offerings within each business unit were limited or nonexistent.
• Processes for consolidations, eliminations, intercompany transactions, fixed-asset depreciation, and associated reporting needs were manual and labor-intensive.
• It wasn’t possible to automate repetitive tasks and workflows to eliminate duplication of effort.
• Different departments and entities had multiple and inconsistent reporting systems and formats.
• Maintenance costs and risk for hardware, disaster recovery, and IT security were high.

Tyler already used many Microsoft products. After evaluating other options, leadership chose Microsoft Dynamics 365 Finance and Supply Chain Management to complement its system landscape and streamline integrations. Dynamics 365 offered a breadth of capabilities and innovative features that aligned with the company's business growth strategy.

Working with implementation partner RSM, the Tyler team divided the project into multiple phases, starting with Dynamics 365 Finance at its headquarters. 

With new capabilities for granular tracking available, the team took the opportunity to assess how the company’s accounting processes could be enhanced. The transition to Dynamics 365 would involve a complete overhaul of the company’s chart of accounts, which was limited in the legacy system. The new chart of accounts would serve the company for years to come, and the team took the time to get it right.

The first phase got underway in late 2022 and went live in July 2023, with a fresh account structure, general ledger, accounts payable and receivable, basic procurement capabilities, and a thorough change management approach to training. Nicole describes the process as, “Adoption took a little while, but we were so ripe for needed change that everyone was onboard overall. We pulled people along by explaining the why behind the changes, which really smoothed the process.”

From initial hesitancy to happy outcomes

The company is just beginning its “One Tyler” business transformation, but the benefits are already improving employees’ daily workflows and providing strategic value to executives.  As Danny Buie, VP of IT Strategy and Data explains, “We’ve laid the foundation for growth and more improvements and enhancements to business operations—and we’re just getting started.”

Increased confidence in the cloud

General ledger transaction detail summary was limited to about 30 lines per month in the legacy system. Leadership was initially doubtful that a cloud-based solution could accommodate a significant increase. Now, Dynamics 365 handles transactions with more than 400,000 lines, including details by customer, product, and salesperson— erasing those early doubts.

Enhanced visibility and financial insights

With the dimensionality of the new chart of accounts and Microsoft Power BI for reporting and analysis, employees can “slice and dice” data in various ways to view everything from high-level revenue down to individual SKUs. This provides management with a more complete understanding of the company’s financial performance and product profitability. Says Teal, “One of the biggest benefits we are seeing is that having a more standardized set of data is enabling us to extract deeper and more detailed analytics across our organization than we were able to get in the past. And, we are just at the beginning of our company-wide implementation.”

Standardized templates eliminate duplication

The number of reports built and distributed by different divisions has dropped from 450 to 7, thanks to standardized templates that can be accessed by everyone to quickly generate needed documentation.

Automating tasks saves valuable time

Accounting teams are saving time and effort with automation of previously manual and labor-intensive tasks. Microsoft Power Automate makes new automations easy to set up out of the box. So far, this is shaving a day off month-end closing which allows the team more time for analytics, and the team anticipates further savings as the company rolls out new procurement processes.

Reducing security risks

Moving to a modern cloud environment ensures business continuity, by providing the latest data protections and resources in the unlikely need for disaster recovery or response to cybersecurity threats.

Enabling an accelerated growth strategy

Onboarding future business acquisitions to Dynamics 365 is faster and simpler with an easy-to-implement finance and operations template.

New certification standards unlock sales

Dynamics 365 has helped Tyler achieve new certification standards that support sales efforts. For example, Dynamics 365 offers Governmental Accounting Systems Standards (GASS), which is important for compliance with some public sector agencies.

Excited for what comes next

With the success of phase one, Tyler is busy implementing phase two of its transformation, adding some areas of warehousing and production for the division that produces physical assets and migrating two of its smaller business units to Dynamics 365.

The change management team is excited to build on Tyler’s new foundation. Multiple projects are underway, targeted for implementation by summer 2024, including:

• Implementing advanced subscription billing to process renewals and receive payments across divisions in one place.
  
  
• Centralizing accounts payable and receivable processes for all divisions to eliminate the need to toggle between different entities.
  
  
• Launching inventory management, sales order management, discrete manufacturing, and project accounting with time & expense tracking modules.
  
  
• Implementing RSM’s Gov Con product to help ensure compliance with government contract regulations, a growing area of Tyler Technologies’ business.
  
  
• Exploring Dynamics 365 Project Operations as a replacement for the company’s professional services tool.
    
• Using procurement functionality in Supply Chain Management to build company kiosks.

As Buie states, “We have a clear vision for Tyler Technologies, and with Dynamics 365, we are no longer constrained by limitations from legacy systems that don’t serve our thriving, growing company.” Reflecting on the company’s success, Chief Accounting Officer Jason Durham adds, “Our transition to Dynamics 365 marks a pivotal step in unifying our business operations and unlocking efficiencies. This transformation isn’t just about modernizing our support systems—it’s about laying a robust foundation for future growth and innovation. We’re excited to harness these new capabilities to better serve our clients and drive our vision forward.”