A Dynamics CRM Solution can be defined as a set of customizations that can be easily moved from a database to another. Depending on project’s context and whether if your environment is a sandbox or not, you can handle two types of solutions. While a managed solution is like a compiled code, an unmanaged solution can be seen like the source code.

Here are the main differences between a managed solution and an unmanaged solution:

Unmanaged Solution:

1. Always used in the development environments (sandbox);
2. Can be edited by customizing existing components or by adding new components;
3. Deleting an unmanaged solution DOES NOT mean that customizations contained in this solution are deleted from the environment. In fact, all customizations stick in the environment’s default solution

Managed Solution:

1. Often used by ISVs (Independent Software Vendor) and sometimes can be useful in production environments;
2. CANNOT be edited once installed in another environment as a managed solution;
3. Deleting a managed solution automatically deletes from the environment all the customizations and the components contained in this managed solution.