Dive Brief:
- IBM launched the IBM Consulting Application Management Suite for SAP to simplify and accelerate modernization efforts using generative and agentic AI, the company announced Monday.
- Despite potential benefits from migrating to SAP S/4HANA, IBM said enterprise transition to the ERP system can be slowed by “legacy complexity, fragmented processes, and resource-intensive operations.”
- SAP’s legacy ECC ERP system support will end in 2027 as the company aims to transition customers to its flagship ERP system S/4HANA. As the deadline looms, just 45% of organizations are live on the new ERP system, according to a survey of Americas’ SAP Users’ Group cited by IBM.
Dive Insight:
Companies are advertising AI agents as strategic tools to help move along complex migration projects for enterprises, but upgrading SAP’s ECC system presents unique challenges given how highly customized these systems can be.
IBM's tool is the latest addition to a growing list of products offering assistance to enterprises migrating to S/4HANA. It creates specific code changes aligned with customer standards and provides proactive monitoring, impact analysis and process flow reverse engineering, according to the announcement.
SAP itself trained its Joule copilot to assist in ERP migrations, adding agentic automation to the product’s capabilities earlier this year. Global IT infrastructure company Kyndryl released a consulting tool in April to ease enterprise data migrations to SAP S/4HANA following the company’s own 18-month ERP migration.
The problem, according to Gartner Senior Director Analyst David Penny, is that migration tools aren’t addressing a core issue that exists with ECC customers: value creation.
SAP customers spent years customizing their ECC systems, creating a lot of technical debt along the way, Penny said. Migrating to S/4HANA means spending significant funds to upgrade or rewrite those customizations “to force the new system to run like the old one.”
The ECC customizations are “the elephant in the room,” Penny said.
“There are a load of tools to help you get to S/4, arguably they’ve been around for years and are getting better and better,” Penny said. “But all that does is get you to S/4. That doesn’t necessarily mean you’ve got any value added if you chose to convert your system.”
Customers won’t make the jump until migration tools can help clean up their old customizations and provide faster access to new features in S/4HANA, Penny said.
