E3 Category: Editor-in-Chief Blog

SAP is stepping up its efforts to further develop S/4 Hana into a holistic suite of composite ERP solutions. The existing S/4 patchwork will be managed by AI assistants and agents. Best-of-breed ERP will be replaced by Composable ERP with Databricks.

What should be done with SAP licenses that are no longer needed and only generate maintenance fees? When company shares are sold or staff is laid off, there are often too many licenses. However, unused licenses result in high support costs and maintenance fees.

SAP left the path of righteousness many years ago. It began with the hybridization of its database. Added value? Unknown. Many other construction sites were added, partly out of ignorance and partly due to competitive pressure. Unfortunately, between topics such as the cloud and AI, SAP has yet to find its way again.

For ten years, SAP has struggled to motivate its customers to switch to S/4 and the cloud, whether private or public. SAP Executive Board Member Thomas Saueressig presented a successful customer evolution that obviously only works on a Greenfield site.

Now the release change from ECC/ERP 6.0 to S/4 Hana may last until 2033. The repeated extension of the current ERP conversion process indicates a lack of planning. SAP no longer understands the ERP market, inventing new transformation scenarios every few years.

FUE (Full Use Equivalent) is a licensing metric from SAP. This raises the question: how much FUE is attributable to an AI agent? The German AI company DeepL presented an agent-based AI that can also access SAP S/4 Hana via standard interfaces such as a browser, keyboard, and mouse.

The CIO is not an innovator, but rather a steward of successful business processes and a facilitator of necessary orchestration. At the same time, the CIO must strike a balance between ERP business management, the IT organization, technology, and licensing fees.

AI is delivering ever more spectacular results and penetrating more and more business areas, but the share prices of IT providers that should be benefiting from this AI hype are falling. What is going wrong with artificial intelligence?

Artificial intelligence has a destructive power: why not use Lovable and a few AI agents to build a new composable ERP based on SAP BTP and BDC? Between traditional Abap ERP and AI, things could get tight for SAP in the cloud.

Because a current release upgrade with or without RISE with SAP is currently overstretching the IT budgets of many SAP customers, ERP alternatives are increasingly being discussed behind closed doors. One possible exit strategy is composable ERP on a stable IT platform.

Gerd Oswald is one of the most powerful and successful former SAP board members. He was the driving force behind the successful deployment of SAP R/3 and Business Suite 7, thanks to tools such as SolMan and initiatives such as the Customer Competence Center (CCC).

SAP is extremely interested in customer evolution and has set up a dedicated department to this end. It has excellent IT tools for finalizing the S/4 conversion. However, RISE with SAP is an imprecise and variable goal without core strengths.