
A strategy to minimize challenges in PSA to PO upgrades
Content
In October 2020, Microsoft stopped selling new Project Service Automation (PSA) licenses, and the product is currently being phased out. Support for it will officially end on March 31, 2025. As this date approaches, it becomes more and more important to plan your upgrade to Dynamics 365 Project Operations (PO) – the newer, fully supported solution.
After the support cutoff date, you will still be able to use PSA, but with significant limitations:
- No feature enhancements or bug fixes.
- Support tickets for the PSA closed with instructions to upgrade to PO.
- No security or compliance updates from Microsoft.
- Upgrade support limited to only proforma invoicing scenarios (Lite Deployment). Resource-based and non-stocked scenarios are currently not supported.
Even though upgrading might seem as simple as clicking a button to some, this is often not the case. Some features will be added, others deprecated, and careful planning is essential to ensure a smooth transition, especially for highly customized PSA environments.
In case you are uncertain where to start, consider reading this detailed article: Upgrading PSA to Project Operations vs. New Installation of Project Operations. It explores the differences between the two approaches, their benefits and drawbacks.
How to effectively plan your upgrade from PSA to PO
To keep your business running as smoothly as possible during the transition, we would like to offer a well-structured, optimal upgrade algorithm to minimize downtime and reduce potential issues. This process includes:
Effort estimation
The first question to ask yourself is: “How customized is my system really?” Specifically, how far has your system diverged from the “out-of-the-box” configuration?
Note: proMX has extensive experience in system evaluation and can help you understand the time and effort required for your specific case.
Upgrade preparation
To prepare your system for the upgrade, ensure you review the following checkpoints:
- Price List Item Settings
The Price List Item Settings entity must be set to True. If it is set to False, you will need to submit a ticket to Microsoft to have this changed. Otherwise, if the upgrade begins with this setting as False, it will fail. - First-party plugins
If first-party plugins (Microsoft plugins) are disabled in PSA, they will automatically be re-enabled during the upgrade. This could cause conflicts with some of your custom features. - System capacity
At a minimum, ensure 20% of your system’s storage is free, as Dynamics 365 Project Operations requires more storage space than PSA. However, having 40–50% free space is recommended, as you will likely need to create copies of your environments during the upgrade. - Project cleanup
Review your projects and close or deactivate any completed ones. Fewer active projects make the upgrade process smoother.- If you have only a manageable number of projects, you can skip this step and address them manually later.
- However, if you have thousands of projects, clearing completed ones beforehand is better.
- Security roles checkup
Ensure that all projects are assigned to active users. If any deactivated users own projects, the upgrade will throw an error, as deactivated users do not have security roles.
The importance of data validation for a successful PSA to PO upgrade
The installation of Dynamics 365 Project Operations consists of five stages, and data validation is the first one. During this stage, PO checks each entity for compatibility with the new system. If an error is detected, the entire process fails. In this case, you have to resolve the issue and restart the upgrade from the very beginning.
Keep in mind that not all errors are displayed at once. Instead, the upgrade stops each time it encounters an issue, which can cause a significant delay. This is precisely the reason why data validation might easily be the most important step in preparing for the upgrade from PSA.
Note: Run the final data validation on your production environment shortly before starting the upgrade (1–2 hours prior).
PSA functionalities evaluation before the upgrade
During the upgrade, certain fields, views, or functions that were part of PSA might be deprecated or replaced in PO. These changes can disrupt workflows, reports, or customizations if not addressed in advance:
- Identify deprecated fields
- Assess views, forms, and dashboards
- Update or replace deprecated fields
- Document all changes for future troubleshooting
Note: Use Microsoft’s official documentation or consult with experts to determine which fields are deprecated in PO.
Upgrade PO in five steps
Once you’ve completed all preparation steps and thoroughly checked your current system, you are now ready to proceed with the upgrade to Project Operations:
- Verify your PSA version
- Check if you are using the latest version of PSA.
- If not, upgrade it before starting the PO installation.
- Install Project Operations
- Navigate to your system and select Install Project Operations.
- If you have completed the preparation steps properly (e.g., data validation, capacity checks, and field updates), the installation should proceed without errors.
- Monitor the upgrade process
- Keep a close eye on the installation process to identify any issues that might arise.
- Document any warnings or error messages.
- Address errors promptly
- Keep running the installation process until there are no issues
Optimizing post-upgrade configuration in Project Operations
After successfully upgrading to Dynamics 365 Project Operations, there are several configuration tasks you still need to complete. These tasks involve adjusting new settings introduced in PO and addressing project conversions.
Configure new settings
Since PO includes settings that were not available in PSA, you need to review and adjust them based on your requirements:
- Configure the Project Parameter Settings to align with your project management needs. These settings govern key project behaviors, such as billing and scheduling.
- Set the Price List Defaulting Behavior.
- Identify and deactivate workflows that are labeled as deprecated.
Convert projects post-upgrade
After the upgrade, all existing projects will be locked. You will need to manually review and convert each project individually to make them accessible in PO. As for closed projects, you will still be able to view those in the system.
Note: Bulk project conversion is not supported in PO. Therefore, it is better to close or clean up completed projects before the upgrade.
Tailoring Project Operations: Post-upgrade customization
After completing the upgrade to Dynamics 365 Project Operations, you need to customize the new working environment. This includes addressing deprecated forms and views, updating custom functions and security roles, as well as implementing any additional features you used to have in PSA (or wish to add now).
While not included out-of-the-box, many organizations find the Copy Project Function useful when it comes to efficiency and standardization. This feature allows you to create project templates and duplicate existing projects. You can learn more about the functionality and implement it by following the instructions by our proMX expert: Project Templates in Dynamics 365 Project Operations.
Common errors during and after the upgrade process
Let us sum up the reasons for possible errors during the upgrade from PSA to PO:
- Invalid data records
- Outdated PSA version
- Insufficient storage or capacity
- Incorrect Price List Item Settings
- Dual-Write Implementation (Finance)
- Time outs (only fixed by restarting)
- Unmanaged SDK Message Processing Step (rare case, but possible)
With proper preparation, no issues should arise during the project conversion stage after the upgrade. However, if any steps were missed during the initial preparation, issues caused by invalid data records or structural inconsistencies might occur. These errors cannot be resolved directly in Project Operations. In such cases, your only options are:
- Create the project in PO from scratch.
- Rollback to PSA, fix the errors there and attempt the upgrade again.
This highlights the importance of thorough data validation before running the upgrade. Addressing errors in advance can save significant time and effort later.
Effective deployment strategy for PSA to PO upgrades
Having conducted numerous upgrades, proMX has developed the safest strategy for upgrading a live production environment from Project Service Automation to Project Operations.
Say, your current system structure consists of the Development, Test, and Production environments, all using PSA. What you need to do first is to make a full copy of your PSA Development environment. Then, create an identical copy of PSA Production in the Test environment.
Having done that, upgrade both the Development and Test instances to PO. Conduct thorough testing on these upgraded environments to verify that everything functions as expected. Only proceed with deploying the upgraded version to live Production once you are confident that the copied Production environment is fully tested and free of issues.
The schema below illustrates this process better:

How to minimize disruptions during the migration
- Double-check all preparation steps, including data validation and system capacity, just before starting the upgrade. This helps catch any last-minute issues.
- Create a backup of your system, including data and configurations, so you can restore it if things go south.
- Communicate with users about the upcoming upgrade and inform them that Project Operations (PO) includes more features than the upgraded PSA. This helps set expectations and prepares them for changes in functionality.
- Keep relevant team members informed about the upgrade timeline and any potential impacts on daily operations to minimize disruptions.
- Schedule the upgrade during off-peak hours, such as over the weekend, to reduce the impact on day-to-day work.
- If errors persist or complex issues arise, consult with Microsoft support or an experienced partner like proMX for expert guidance.
Conclusion
Depending on your system, upgrading from PSA to PO can have different levels of complexity. However, it is always better to come prepared. Thorough data validation, effective communication, and expert support are essential for a successful upgrade.
proMX is here to assist you at every step of the migration, from initial planning and effort estimation to updating custom functions and configurations. With our expertise, we can help make your upgrade process as efficient and smooth as possible. For more information on our services, visit proMX’s PSA to PO migration page.