E3 Category: Editor-in-Chief Blog

In an interview for the German-language medium Computerwelt.de, SAP Executive Board member Thomas Saueressig defined a Frankenstein ERP architecture, shortly after his Executive Board colleague Muhammad Alam warned of the danger of an ERP patchwork quilt.

At the end of AI development, there will also be a small language model at SAP. SAP is now content with small successes. Based on its own Abap tables, mechanisms such as machine learning are to be used as a supplement to SAP PAL. Uncertain added value?

SAP customers want and need cloud, AI, and IT platforms. SAP has good offerings with Joule, Cloud ERP, BTP, and BDC. However, the licenses and IT conditions do not align with users' ERP reality. SAP does not understand its customers, and vice versa.

SAP had originally planned to end mainstream maintenance for SAP Business Suite 7 (ERP/ECC 6.0) at the end of 2025. This deadline caused significant concern within the SAP community because it was considered unrealistic and potentially disastrous, especially given the severe shortage of qualified experts and consultants for the S/4 migration.

The maintenance of an SAP ERP system by a third-party provider, mixed maintenance by SAP and a third-party company, and partial decommissioning of SAP licenses have been controversial topics in the SAP community for years. A lot of money is at stake!

SAP is stepping up its efforts to further develop S/4 Hana into a holistic suite of composible 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.