Keeping ERP in Balance

ERP balance and SAP transformation

An S/4 conversion is a digital transformation and an agile orchestration of your organizational and operational structure. Without an SAP team, such as a CCoE (Customer Center of Expertise), with ample ERP and change management expertise, an effective S/4 conversion cannot be effectively designed. There is often a lack of available specialists in the SAP community during the planning phase. In addition to SAP, SAP partners are in demand to compensate for a lack of in-house expertise, as well as to support ERP transformations with their experience.

The main challenge for SAP customers is finding the right balance between SAP offerings and those of partners and competitors, such as ServiceNow, Workday, Boomi, Salesforce, UiPath, and others. The boundaries between an in-house ERP system and the IT world have changed due to AI, cloud, open source, hyperscalers, and platform technologies. A composable ERP requires significant experience to maintain balance; in comparison, a "black box" like SAP R/3 posed an easier challenge. These different focuses demonstrate that transformation cannot be a standard process. Transformation is an investment in future viability and competitive strength.

ERP data quality is not possible without a platform and AI

With the Business Data Cloud (SAP BDC), the focus was on data quality and management at the beginning of 2025. Insufficient data quality inhibits a successful S/4 conversion and is often the result of inadequately analyzing the existing ERP landscape and IT data. SAP customers often underestimate the effort involved. SAP's answer is: Databricks.

Based in San Francisco, Databricks is a US software company that offers cloud-based solutions for building and managing data for companies, combining this with machine learning and artificial intelligence models. For SAP customers, technical IT progress is now the main reason to convert to S/4, rather than cost pressure or organizational measures. AI is now also considered a key technology, especially in the DACH region. However, awareness alone is not enough for successful implementation; a carefully planned strategy and the right skills are required.

Databricks is the expertise behind the Business Data Cloud. Even before SAP's collaboration with Databricks, many SAP customers were using Databricks' tools and functions in their data centers or via hyperscalers. This usage has also increased the use of AI and platform technology. SAP's Business Technology Platform (BTP) is available for this purpose.

IT technology versus ERP organization

Cloud and AI technology alone are insufficient for transformation; it requires expertise, orchestration, and agility. Customer evolution and conversion are holistic and comprehensive processes. Without SAP teams—such as a CCoE and DevOps, and existing expertise—change cannot be effectively managed. Nearly 90 percent of companies in the SAP community want to prepare for using artificial intelligence. What initially seems like IT progress becomes clearer upon closer inspection: The biggest hurdle is and will continue to be poor data quality.

The current challenge for SAP customers is finding a balance between reforming the organizational and operational structure (business processes) and IT technologies, such as the cloud and AI. Although new ERP technologies are a key motivation for S/4 conversion, data quality remains the bottleneck. ERP life is changing: the cloud is being used more and more strategically! It's not just an IT model; it's also an innovation platform for agility, scalability, and AI.

Of course, the old IT saying is well known: never change a running system! So, how can you maintain balance between legacy systems, inertia, transformation, and upcoming innovations? Learn more at the DSAG Annual Congress 2025 in Bremen. The risks of an unsuccessful ERP transformation can be measured in business terms, including cost increases, loss of performance, and technical incompatibility.

With SAP Customer Evolution, companies can transform and balance their own ERP. However, SAP customers need the freedom to choose this option. SAP has not yet recognized the advantages of a composite, best-of-breed, and composable ERP, nor has it become an open company. Technical hurdles and complex licensing fees prevent balance between SAP, its competitors, and open-source software.