When transitioning between new systems, it’s essential to transfer your data correctly, intact and ready to perform. Doing so ensures the continuity of your operations and prevents the loss of valuable data that may be crucial to your business performance.

When moving to Dynamics 365 from a legacy system, you need to migrate data effectively. And successful migration doesn’t happen by accident. It requires planning, precision and a clear understanding of what’s at stake. And that means carefully preparing for the move in advance and following a robust process.

A well-executed data migration plan can optimise your business processes by consolidating data into a unified, high-performing platform, reducing manual entry and allowing for up-to-date decision making. It’ll also make it easier to get more value from your new system, with fewer teething problems to deal with.

We’ve put together this step-by-step guide to help you effectively migrate your data to Dynamics 365.

Step one: Planning and preparation_

Planning is crucial to any successful data migration, so devote time to this early on.

The exact plan will depend on the systems involved in the migration, which will include Dynamics 365 and the system you’re moving away from. Every system has a unique data structure, so spend time understanding yours as it may highlight key considerations in the process.

You will then need to define your data mapping process. For this, you need to understand the entities within Dynamics 365, including the fields, data types and relationships that can be stored. Then, you will need to do the same for your legacy system.

If there are differences in the data entities, you need to adapt your existing data, so it fits the attributes within Dynamics 365. This may require some manual intervention.

Another good practice to follow in this stage is cleaning and validating your data in your legacy system. During this process, you should look to ensure all data stored in correct and accurate, while removing duplicate, outdated or unwanted records.

This will streamline the migration process and avoid you moving records you don’t need, while allowing your new system to start with only accurate and valuable data.

Finally, we recommend backing up your data ahead of any migration. This means that, if anything goes wrong, you can recover the data and avoid any losses.

Step two: Data extraction and transformation_

Next, we move onto the first phase of the migration process.

First, you will need to extract data from your old system. There are a few options for doing this.

APIs and web services

If your source system offers APIs or web services, you can directly connect to them to extract data. This provides you with flexibility and control during the process, but can require technical expertise.

Data export tools

Many source systems have built-in data export tools that allow you to extract data in specific formats (e.g. CSV, XML, JSON). Again, this can be a straightforward way to migrate data and works particularly well for smaller datasets. However, it can be limiting if you have larger datasets or if you want to customise the migration.

Database queries 

If your source data is stored in a database, you can use SQL or other query languages to extract the required data. This allows you to carefully control the extraction process, which is ideal when handling complex scenarios. However, it requires in-depth knowledge of the database. It can also be very time consuming when you’re working with large volumes of data.

Third-party extraction tools

There are numerous third-party tools designed specifically for data extraction and migration, which may support the process. These often offer advanced features and automation capabilities for a seamless process. But they do come at a cost, and you’ll need to learn how to use them.

ETL tools

ETL (Extract, Transform, Load) tools are designed to handle complex data migration processes. They are a robust and scalable solution for large-scale data migrations. But once again, they can be expensive to acquire and will need appropriately skilled resource to use them correctly.

The exact method you choose will depend on numerous factors, including budget, data volume, complexity and the resource available to manage the process. Aim to choose an option that makes the most sense for your business.

Once you have extracted the data, you’ll also need to transform it.

In the transform phase, you need to ensure data is formatted so it fits the requirements of Dynamics 365. If there are differences uncovered in your earlier preparations, this is where you will need to convert them. Dynamics 365 will try its best to detect the fields that data should be stored in, but there may be some manual input required.

Some of the tools above, such as ETL, might help you through this part of the process too.

Step three: Data loading_

Next, we moved onto the data loading phase. This is where you place your data into Dynamics 365.

Start by choosing your loading method. Again, you have options for this!

Bulk loading

This is the ideal option if you are uploading large datasets. Data is loaded in batches, and Dynamics 365 will process each batch sequentially. Dynamics 365 does have some limits on the size of each batch, so be sure to check the specification of your deployment to adhere to these.

As the name suggests, bulk loading involves uploading data in big volumes, so this means it can take a long time to complete.

Incremental loading

This is often used when you need to load data changes incrementally, such as for real-time updates. However, only changes made since the last load will be brought into Dynamics 365.

You will also need a mechanism to track and identify data changes between loads to allow the process to happen accurately.

Integration with real-time data sources

This method involves establishing a direct connection between your legacy system and Dynamics 365, allowing data to be synchronised in real time. Any changes in your old system are immediately reflected in Dynamics 365.

This option does require a stable connection, which can be challenging for larger datasets.

Data import/export tool

Many Dynamics 365 implementations include a built-in data import/export tool that can be used to load data. Data is typically loaded in a structured format, such as a CSV file.

This can be a straightforward way of loading data but can make it hard to customise the process and might struggle with larger volumes of information.

ETL tools can also once again help with the load phase.

When you’ve chosen your method, you’ll need to configure the loading. This includes ensuring your data is in a compatible format, defining mapping to Dynamics 365 and choosing batch sizes. You can also choose to schedule the load to automate the process.

In some cases, conflicts may arise during the loading process. Hopefully, your preparation will ease most of these, but have a plan for handling conflicts, which will include when to overwrite, merge and ignore data.

Data can be split into two camps: master data (e.g. Customers, Vendors, Items) and transactional data. Whilst you will want to transfer all the master data (after you have cleaned it and removed old redundant records), you will want to test the transactional migration.
However, for transactional data this will only be available at the point of go-live (or even after). Dynamics 365 allows for transactions (e.g. opening trial balance) to be uploaded retrospectively once it has been completed in the legacy system.

Step four: Post-migration validation and testing_

By now, the migration process is complete! However, you’ll want to check everything has happened smoothly.

First, verify the quality of the migrated data. Is it accurate and complete? Has it been stored within the right field, with the right relationships? If you spot any errors in this stage, you will want to rectify them before you start using Dynamics 365 as it will likely lead to inaccuracies in performance.

Then you’ll want to test the Dynamics 365 deployment itself. Check that functions happen as expected, giving you the correct outcomes.

Part of this should involve end-users who will be using the system. Give them time to navigate the system as they would need to do in their everyday tasks and feedback on any issues.

If there are problems at this stage, you should dig deeper and aim to resolve them to ensure the system meets requirements.

In some projects there will be an initial test data migration. This is an ideal process to find any errors and help the planning for the final cut-over. Users can then be trained and can test the new system using their own data.

For transactional data you will want to reconcile all balances and ensure they agree with the closing position in your old system.

What are the most common issues that occur when migration data to Dynamics 365?

Good preparation should make the move to Dynamics 365 much smoother. However, there are common issues that can emerge. We’ve listed them to help you troubleshoot and prepare.

• Inconsistent data: Variations in data formats, values or structures can cause mapping and loading issues. Commonly, this is caused by differences between the old system and Dynamics 365. You can avoid it by prepping your data, but some manual checking and amending might be required to completely solve it.
• Missing or incomplete data: When working with large datasets especially, there can be issues that cause some data not be loaded or attributes to be missing. Sometimes, incorrect mapping can also lead to orphaned data if the correct relationships aren’t set. Having the right data mapping and loading approach can prevent this.
• Slow performance: When working with large volumes of data, it can cause a significant strain. This may result in slow loading timeframes or poor performance, especially while the process is ongoing. If the network is disrupted during the process, it can also result in data issues later.
• Incorrect settings: Incorrect configuration of Dynamics 365 settings, such as security roles or workflows, can affect data migration. Similarly, highly customised data may struggle in the migration process. This is why the system should be thoughtfully configured ahead of migration.
• User acceptance issues: Moving from a legacy system to Dynamics 365 is a significant change for users, who may have concerns. User testing can help them to ensure their requirements are met for a smoother transition, but be prepared to handle resistance and wait patiently for the change to have a positive impact.

Working with a Dynamics 365 partner through the data migration process_

Data migration is a necessary process when moving from one system to another. However, it can also be time-consuming, complex and require capable resource, which not every business has internally.

Working with a Dynamics 365 partner can provide much-needed guidance through the process. An experienced partner should be to support you in the planning of your migration, including understanding how to map and format your data correctly in line with the requirements of your Dynamics 365 deployment.

They can also help you to extract, transform and load the data so it reaches your new system in the right way.

They’ll also work with you beyond migration to conduct thorough user testing and iron out any issues before you officially launch Dynamics 365 in your business.

Preparing for business success with Dynamics 365_

Migrating to Dynamics 365 is more than a technical shift; it’s a strategic opportunity to future-proof your business. But in today’s economic climate, small and medium-sized businesses face mounting pressures: uncertainty, cyber threats and the challenge of retaining skilled talent. These issues impact profitability and long-term growth.

That’s why a successful migration isn’t just about moving data. It’s about setting your business up with the tools to adapt, protect and thrive. Microsoft Dynamics 365, with its AI-driven capabilities and integrated platform, offers a powerful foundation for digital transformation.

Want to understand how Dynamics 365 can help your business navigate today’s challenges? Watch our on-demand webinar, where we explore:

• The biggest challenges facing SMBs right now, and how to overcome them
• How Microsoft Dynamics 365 and AI can drive efficiency, security and smarter decision-making
• Real-world strategies for digital transformation that deliver measurable results
• What to look for in a technology partner to ensure long-term success