AI Unleashes Transformative New ERP Capabilities, ISG Says
Companies adopting cloud-based, AI-enabled platforms for business benefits from automation, integration, industry-specific capabilities, new research finds
Enterprise resource planning (ERP) software has evolved to serve the needs of a wide range of industries and company sizes and continues to gain new capabilities through AI and cloud computing, according to new research from global AI-centered technology research and advisory firm Information Services Group (ISG).
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The ISG Buyers Guides™ for Enterprise Resource Planning, produced by ISG Software Research, provide the rankings and ratings of 20 software providers and their products to support the core processes of large and midsize enterprises. The research finds that migration to the cloud and integration of AI, generative AI, natural language processing (NLP) and agentic systems are making ERP systems more usable, adaptable and extensible.
“AI is redefining how organizations interact with software, including the ERP systems at the core of enterprise operations,” said Robert Kugel, executive director, Business Research, ISG Software Research. “By 2028, almost all ERP software providers will have incorporated AI to reduce errors, lighten workloads and speed up processes.”
ERP platforms improve enterprise efficiency and decision-making by integrating data, processes and reporting across departments. Beginning as on-premises software, they have gradually migrated to the cloud since the early 2000s, which has increased scalability, continuity and performance and enabled faster implementation and continuous upgrades. By 2028, ISG expects more than 80 percent of ERP systems purchased by non-product companies to be deployed in the cloud.
AI is already increasing ERP productivity with early capabilities such as anomaly detection and automated data entry, ISG finds. It makes repetitive accounting and administrative functions more efficient and allows staff to focus on more valuable analytical tasks. Intelligent agents are managing operations such as expense accounting and reconciliation with limited human intervention.
Connecting ERP with other software, such as human capital and supply chain management systems, has become increasingly important, the research finds. Application programming interfaces (APIs) form the basis of reliable integration among systems, which improve transparency and accuracy for more unified, data-driven decision-making.
Providers of ERP software are designing systems to address the distinct needs of specific industries and sectors, such as healthcare, pharmaceuticals and logistics, the research finds. They embed relevant processes and regulatory frameworks into these products, allowing enterprises to implement the software more quickly, with less need for external customization.
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ERP platforms have also become segmented by enterprise size to best match the complexity of the system to customers’ organizational scale and requirements, ISG finds. The main differentiation is between platforms for large enterprises, with 1,000 or more employees and often global scale, and midsize organizations with between 100 and 999 employees. ERP software for the latter market usually strikes a balance between breadth and usability, incorporating preconfigured industry-specific capabilities.
For its Buyers Guides for Enterprise Resource Planning, ISG evaluated software providers across four platform categories — Enterprise Resource Planning, Healthcare ERP, Manufacturing ERP and Midsize Enterprise Resource Planning — and produced a separate Buyers Guide for each. A total of 20 providers were assessed: Acumatica, Aptean, Epicor, Exact, Forterro, IFS, Infor, Microsoft, Oracle, Oracle NetSuite, QAD, Ramco, Rockwell Automation, Sage Intacct, Sage X3, SAP Business One, SAP S/4HANA, TechnologyOne and Workday.
ISG Software Research rates software providers in five evaluation categories: Overall, Product Experience (incorporating Capability and Platform) and Customer Experience. Providers ranked in the top three for each evaluation category are named as Leaders. Within each platform category, those with the most Leader rankings are named as Overall Leaders.
The Overall Leaders of the Buyers Guides for Enterprise Resource Planning were the following:
Enterprise Resource Planning: SAP S/4HANA was the top Overall Leader, followed by Oracle and IFS. All three Overall leaders were designated Leaders in five evaluation categories. All three were rated Exemplary, along with Infor, Microsoft and Sage X3. Acumatica and Epicor were rated Innovative.
Healthcare ERP: Oracle was the top Overall Leader, followed by SAP S/4HANA and Workday. Oracle and SAP S/4HANA were designated Leaders in five evaluation categories each, and Workday was a Leader in four categories. All three Overall Leaders were rated Exemplary, along with Sage Intacct. No providers were rated Innovative.
Manufacturing ERP: SAP S/4HANA was the top Overall Leader, followed by Oracle and IFS. SAP S/4HANA and Oracle were designated Leaders in three evaluation categories each, and IFS was a Leader in two. All three Overall Leaders were rated Exemplary, along with Infor, Microsoft and Sage X3. Acumatica and Epicor were rated Innovative.
Midsize Enterprise Resource Planning: IFS was the top Overall Leader, followed by Sage X3 and Microsoft. IFS was designated a Leader in five evaluation categories, Sage X3 in four and Microsoft in three. All three Overall Leaders were rated Exemplary, along with Infor. Acumatica, Epicor and Forterro were rated Innovative.
“ERP modernization requires strategic planning to mitigate risk and support broader transformation and best use of investment, resources and time,” said Mark Smith, partner and chief software analyst, ISG Software Research. “This comprehensive portfolio of research on ERP provides the opportunity and dimensions of focus to determine the relevance of software providers and see whether their strategies, roadmaps and AI directions align with an enterprise’s current and future priorities.”
The ISG Buyers Guides™ for Enterprise Resource Planning are the distillation of more than a year of market and product research efforts. The research is not sponsored nor influenced by software providers and is conducted solely to help enterprises optimize their business and IT software investments.
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