With Microsoft Dynamics CRM 4.0 Enterprise Edition, a CRM server can now host multiple organizations.  This means that multiple Microsoft Dynamics CRM installations can be combined into one install, with one central configuration database managing input requests to multiple company data files.  The result is lower total cost of ownership for customers requiring a hosted environment since we are able manage CRM installs on fewer servers.  Response times for single server multi-tenant CRM are comparable to a single-tenant install.

Multi-Tenancy can be used for companies with separate brands or divisions.  Example:  a company has two divisions, one that sells bicycles and another trucks.   In this model, multi-tenancy would enable the company to have one CRM installation, while each division has a separate database and customization of the application.