ISG research says most ERP software will incorporate AI fully by 2027
Artificial intelligence in all its forms, including GenAI, natural language processing, agents and agentic devices, will revolutionize enterprise resource planning (ERP) systems and the ways individuals and enterprises work with the software by 2027, a new research report from leading global technology research and advisory firm Information Services Group (ISG) (Nasdaq: III) says.
The ISG Buyers Guides for Enterprise Resource Planning, produced by ISG Software Research, say current technology trends will revolutionize ERP systems by making complex processes faster and easier to execute and condensing highly repetitive accounting and other tasks through automation. Almost all providers of ERP software will incorporate AI by 2027 to reduce workloads and speed processes and reduce errors, the reports say.
"ERP systems, which have served as the central nervous system of enterprises for decades, are in the midst of a technology revolution," said Robert Kugel, executive director, Business Research, ISG Software Research. "AI-powered change is already underway in the form of anomaly detection to flag potential errors and technology that makes processes faster and easier to execute. The use of AI in ERP platforms will boost productivity and enable enterprises to attract and retain the best talent."
Modern ERP systems offer enhanced functional depth, usability, adaptability and manageability, largely because their cloud-based environments make them easier to maintain. The shift from on-premises to cloud-based ERP continues to accelerate, driven by improved configurability and customization options for specific industries, the reports say.
By 2027, more than 80 percent of ERP systems purchased by non-product companies will be deployed in the cloud to promote continuity, improve performance and lower costs, ISG says. In addition, as developers refine and tailor ERP platforms to a greater number of specific industries, implementation, maintenance and total costs of ownership have decreased.
While the decision to upgrade or replace a core ERP system is challenging due to associated costs and potential disruptions, ISG says CFOs should recognize that outdated systems pose risks to enterprise operations. Enterprise leaders should take a strategic approach to assessing new software and providers' AI capabilities, rather than implementing a simple like-for-like replacement.
For its 2024 ERP Buyers Guides, ISG evaluated software providers across six application categories – ERP, ERP Financial Management, ERP Manufacturing, Midsize ERP, Midsize ERP Financial Management, and Midsize ERP Manufacturing – and produced a separate Buyers Guide for each. A total of 21 providers were assessed: Abas, Acumatica, Aptean, Deltek, Epicor, Exact, IFS, Infor, Microsoft, Oracle, Oracle NetSuite, QAD, Ramco, Rockwell Automation, Sage Intacct, Sage X3, SAP Business One, SAP S/4HANA, TechnologyOne, Unit4 and Workday.
ISG Software Research designates the top three software providers as Leaders in each category. For the 2024 study, the leading providers in ranked order are:
ERP: SAP S/4HANA, Oracle and Infor
ERP Financial Management: Oracle, SAP S/4HANA and Workday
ERP Manufacturing: SAP S/4HANA, Oracle and Infor
Midsize ERP: Infor, IFS and Epicor
Midsize ERP Financial Management: Infor, Sage Intacct and SAP Business One
Midsize ERP Manufacturing: Infor, IFS and Sage X3
"Software providers increasingly are transforming their ERP systems to run on modern, cloud-based platforms that allow for continuous enhancements, including AI," said Mark Smith, partner, ISG Software Research. "Unfortunately, current enterprise deployments have become too customized and need to be re-evaluated and re-implemented to take advantage of the benefits of AI and other new technologies. Our ISG Buyers Guides provide a roadmap for assessing and selecting ERP software providers that accelerates time to value and reduces total cost of ownership."
The ISG ERP Buyers Guides are the distillation of a full 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.
Visit this webpage to learn more about the ISG ERP Buyers Guides and read executive summaries of each of the six reports. The complete reports, including provider rankings across seven product and customer experience dimensions and detailed research findings on each provider, are available by contacting ISG Software Research.
About ISG Software Research
ISG Software Research provides authoritative coverage and analysis of the business and IT software industry. It distributes research and insights daily through its user community, and provides a portfolio of consulting, advisory, research and education services for enterprises, software and service providers, and investment firms. Its ISG Buyers Guides help enterprises evaluate and select software providers through tailored assessments powered by ISG's proprietary methodology. Visit www.isg-research.net for more information and to sign up for free community membership.
About ISG
ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world's top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including AI and automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry's most comprehensive marketplace data. For more information, visit www.isg-one.com.
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Julianna Sheridan, Matter Communications for ISG
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