Microsoft Dataverse Explained: Fit, Uses and Best Practices

What is the Dataverse?

Microsoft Dataverse is Microsoft’s cloud data platform for business apps. It stores data in relational tables with role-based security and auditing, and it underpins Power Platform and many Dynamics 365 apps.

Your data lives in tables (rows and columns), but you also get the “business app stuff” teams usually forget until it hurts: security, governance, and a structured way to build apps and automations on top.

I describe it to clients like this: Dataverse is the database layer designed for business apps, not just storage. If you treat it like “Excel in the cloud”, you’ll build a mess. If you treat it like a platform, it’s excellent.

What “slow queries” looks like in the real world

You’ll typically hear complaints like:

• List pages take ages to open, filter, sort, or move between pages

• Posting hangs or intermittently times out (especially at busy times)

• Reports degrade from seconds to minutes over time

• OData/API calls get slow as volumes grow

• Month-end turns BC into treacle

Where Dataverse fits in the Microsoft ecosystem

Dataverse sits at the centre of the Power Platform and connects neatly into Dynamics 365.

Power Platform

Dataverse is commonly used as the data store for Power Platform solutions, especially when you need multiple apps/flows to share the same governed data model.

Dynamics 365

Many Dynamics 365 “Customer Engagement” apps run on Dataverse (Sales, Customer Service, Field Service, Marketing, etc.). Microsoft explicitly manages these as Dataverse-based apps in the Power Platform admin centre.

Microsoft Teams

There’s also Dataverse for Teams: a Teams-first version built on Dataverse, intended for team-level apps and data inside Teams.

Copilot angle (keeping it real)

Microsoft positions Dataverse as an “enterprise data platform for Copilot” and ties it into Copilot Studio scenarios. That’s directionally true, but it’s not magic: your Copilot quality still depends on data model, permissions, and governance.

What sort of business is Dataverse aimed at?

Dataverse is aimed at organisations that need shared, structured, secured business data across apps, teams, and processes.

It’s usually a fit when:

• You’re building internal business apps (approvals, onboarding, job tracking, compliance)

• You need security and auditing beyond “who has the spreadsheet link”

• You want automation that’s triggered by data changes and can be packaged/released properly

If you’re tiny and everything lives in email + Excel, Dataverse can be overkill. If you’re scaling and your processes are creaking, it can be the difference between “managed growth” and “organised chaos”.

What Dataverse is genuinely good at

1) A proper security model for business apps

Dataverse uses a role-based security model to control access to data and resources. Users can have multiple roles and privileges accumulate.

2) Auditing and compliance-friendly tracking

Dataverse supports auditing to log changes, user access (via apps/SDK), and more — and those logs consume log capacity, which matters for cost and housekeeping. 

3) Application lifecycle management (ALM) via solutions

“Solutions” are the packaging mechanism to move apps/components between environments, and Microsoft’s ALM guidance ties this directly into Dataverse-backed environments. 

4) Extending Dynamics 365 without duct-tape integrations

Because many Dynamics 365 apps run on Dataverse, extending them with tables/columns/apps can be far more native than building a separate database and trying to sync everything.

How Dataverse fits with Business Central

This is where it gets practical.

Option A: Dataverse data sync (integration approach)

Business Central has documented integration patterns with Dataverse to connect BC to other Dynamics 365 apps or your own Dataverse solutions.

Option B: Virtual tables (surface BC data without copying it)

Business Central supports Dataverse virtual tables so you can work with Business Central data surfaced in Dataverse/Power Platform without storing a duplicate dataset. There are specific admin and modelling docs for this.

Our rule of thumb is:

• Keep Business Central as the system of record for finance, inventory, orders, posting.

• Use Dataverse as the process/app layer when you need extra workflows, cross-team apps, or Dynamics 365 CE alignment.

• Prefer virtual tables when you mainly need visibility/action on BC data, but don’t want to replicate and reconcile it later.

The biggest mistakes we see (and how to avoid them)

1. Treating Dataverse like a dumping ground
   You’ll end up with duplicate tables, inconsistent fields, and “which ‘Customer’ table do we use?” arguments.
2. Skipping governance because it’s ‘low-code’
   Low-code doesn’t mean low-consequence. Use environments + solutions properly.
3. Ignoring capacity until the bill arrives
   Dataverse storage is tracked across database, file, and log capacity in the Power Platform admin centre. And yes, you can buy add-on capacity (database/file/log).

Where Dataverse is the wrong tool

Dataverse isn’t a replacement for:

• An ERP (that’s Business Central’s job)

• A data warehouse / analytics lake (use the right analytics architecture)

• A “file server in a suit” (plan document storage deliberately)

Use it for business app data and process, not as a universal bucket for everything digital.

Quick “should we use Dataverse?” checklist

If you can answer “yes” to 3+ of these, Dataverse is worth a serious look:

• Do we need multiple apps/flows to share the same governed dataset?

• Do we need role-based access control by team/function?

• Do we need auditing for compliance/process control?

• Do we want a clean Dev/Test/Prod release approach using solutions?

• Do we need to extend Dynamics 365 apps or connect BC to Dynamics 365 apps cleanly?

Frequently Asked Questions

Next Steps

If you want to discuss if Dataverse is right for your business, get in touch.