This blog was originally published in October 2022 and was updated in December 2025
The days of the monolithic ERP software are numbered. Organizations are tired of confining their business practices to those purely defined by ERP vendors such as SAP and Oracle. Instead, leaders are seeking an outcomes-based composable ERP strategy, selecting an optimized mix of vendors and technologies to help them best achieve their operational, business and competitive goals. This enables organizations to easily adopt the latest innovations such as Agentic AI ERP, a rising technology model that allows automation of processes and connecting of disparate applications for greater efficiency and improved user experiences.
In this post, I will deep-dive into the world of and demystify the term, “composable ERP,” as well as share the remarkable benefits that organizations can derive from adopting a composable ERP strategy, especially when adding Agentic AI capabilities over the top of existing systems.
What is composable ERP?
Composable ERP is a strategic approach to ERP that allows organizations to construct their ERP system using a modular and flexible framework.
Unlike monolithic ERP systems, composable ERP systems have interchangeable applications that give enterprises the autonomy to select and integrate applications and services tailored to their unique business needs.
Adopting a composable philosophy enables you to create a workflow that focuses on outcomes, rather than shoehorning your unique processes into a rigid technology. After all, it’s becoming increasingly clear that there isn’t a single solution that’s a perfect fit for all organizations. Today, it may well be a mixture of people, vendors, solutions and technologies — assembled in a modular fashion — that can best meet an organization’s needs.
What is driving the shift to composable ERP?
In recent years, there’s been a significant increase in the number of organizations adopting a composable ERP strategy. There are three key drivers for the shift:
- New subscription-based ERP systems. Both SAP and Oracle are seemingly pushing their customers into a one-size-fits-all ERP solution that’s hosted on vendor infrastructure. This can cause organizations to lose flexibility as these vendors exert more control on these systems.
- An abundance of solutions. In the world of software-as-a-service (SaaS) platforms, there are more solutions available now than ever before. These programs are often tailored toward a specific industry, need or niche, and they can often provide results that are superior to a one-size-fits-all system.
- Data integration. Previously, getting disparate systems to talk to each other, share data and ensure the correct role-based access was a challenge. Today, there are data orchestration layers and federated data fabrics that offer greater interoperability, available as a product independent of ERP vendors.
Ultimately, the growing trend of composable ERP structures can be explained by the simple fact that organizations now have something they lacked in years prior — choice.
How does composable ERP differ from monolithic ERP?
With a composable ERP approach, organizations can easily adopt technologies that meet their unique needs and switch them out as needed. In contrast, a monolithic ERP approach is focused on keeping inflexible ERP systems that have a rigid architecture and technical limitations.
It appears that traditional ERP vendors are continuing to build inflexible, monolithic systems that require an organization to pay for custom development to fit its needs. As traditional ERP vendors such as SAP and Oracle push customers to migrate to newer ERP systems, they’re also taking more of the technology stack away — such as the hosting infrastructure and technical support —as they move to a subscription-based billing model. This causes organizations to lose not only the flexibility of their current system but also their negotiating power with these vendors. They can no longer decouple that ERP software from the vendor selling the subscription. It’s the ultimate vendor lock-in.
A composable ERP strategy in action
Let’s look at an example of a composable ERP strategy for a company that uses SAP ECC for most of its core business functions.
At the request of the sales team, the organization decides to implement Salesforce as its customer relationship management system to better support that group. Additionally, the HR department decrees that Workday is its HR solution of choice, as it promises to shorten the time to hire and boost employee retention. A composable ERP strategy would enable the organization to adopt each of these solutions to solve each team’s specific challenges.
No upgrading to a newer ERP system was required, and now both the sales team and HR team are able to benefit from their systems of choice rather than being forced into SAP’s CRM or HR products. Five years from now, sales or HR may find a product more suitable and that returns a higher ROI. A composable ERP strategy empowers the organization to be nimble, swapping out one HR tool for another to yield higher returns without disrupting operations.
Adopting composable ERP means more than implementing a modular solution for each business unit. At its core, a composable ERP strategy represents a philosophical mind shift toward taking back control by not letting vendors dictate the course and destination, and ensuring technical solutions take a backseat to business objectives.
Benefits of composable ERP
Choosing a composable ERP architecture will require your organization to untangle itself from a monolithic ERP system, but doing so can yield substantial benefits. Primarily, your organization can achieve a degree of flexibility that isn’t available with a one-size-fits-all solution. Further, you can reap the benefits of AI without having to undergo a major ERP reimplementation or migration. This flexibility manifests itself in the following ways:
Thrive in an optimized and unique environment
When your organization can interchange components of your ERP, you can customize the environment to your exact specifications. Configure services in a modular fashion rather than having to work around this need by writing custom implementations for the out-of-the-box ERP system. Every organization has unique rules, operating assumptions and needs. Transitioning from customizations to configurations can enable you to achieve business outcomes faster while your competitors are still trying to wedge theirs into a given technology.
Evolve at your own speed, not the ERP vendor’s
Relying on a monolithic ERP system means you’re captive to the speed of innovation of a single — often large and slow-moving — vendor. You only gain access to the features and functionalities as they’re released, usually in a massively disruptive upgrade or patch. Instead, with a composable ERP strategy, you can leverage a solution from a small, nimble provider that’s laser-focused on a particular piece of the overall technology stack. When you’re following your organization’s own roadmap, you have a clear advantage over the competition.
Extend the life of current ERP systems
Rather than being pushed to upgrade your ERP to meet the requirements of the vendor’s subscription-based services, your organization can keep those core components and extend functionality with other vendors. You should stop thinking about SAP and Oracle in a singular context and instead view the ERP system as a set of discrete functions, such as:
- Order to cash
- Procure to pay
- Finance
- Operations
- Manufacturing
- Business intelligence
- Payroll
While most of that functionality may be contained in the SAP or Oracle ERP systems, your organization may find some of their features suboptimal. Transitioning to a composable ERP strategy lets you take advantage of the best features of your current systems while implementing other technologies in a modular fashion to add the functionality that you lack.
Increase overall ROI
Prioritize ROI over costs by measuring how the outcomes produced by additional technologies will be superior to those of the core ERP system.
Every organization must put a dollar amount on the outcomes it’s able to get today versus what it could achieve tomorrow with better technology. That outcome could, of course, be cost savings, but it could also include more operational efficiency, less errors, elimination of rework, improved adherence to compliance and regulatory requirements, reduction of risk and more. When your organization is deciding whether to adopt a composable ERP strategy, you must consider the ROI of all possible outcomes, not just the cost savings.
There are myriad benefits to adopting a composable ERP strategy. I discuss them in greater detail with my colleague Scott Hays in this video:
What is Agentic AI ERP?
Monolithic ERP software suites continue to serve as reliable but static systems of record, preserving transactional integrity and providing fast transactional throughput. But they aren’t designed to orchestrate real-time business actions across diverse systems.
Agentic AI enables new systems of action that connect business processes across applications and departments. Leveraging Agentic AI in ERP transcends single-vendor ERP systems to orchestrate actions across departments, integrate decentralized data sources and delivering unified analytics requires a holistic approach that traditional, monolithic ERP architectures cannot support.
Rimini Street, the Software Support and Agentic AI ERP Company™, is an early provider of Agentic AI ERP – leading a major technological shift that is disrupting traditional, monolithic ERP software models.
Agentic AI transforms ERP systems from static systems of record to dynamic systems of action, allowing for faster, more accurate transactions, process automation and better decision-making. Agentic AI ERP deploys intelligent electronic “agents” that can think like humans, autonomously set goals and make decisions.
Rimini Street: The Software Support and Agentic AI ERP Company
If you want to take advantage of all the benefits that Agentic AI offers for your on-premises ERP, you must take a composable approach to ERP rather than sticking to an outdated monolithic ERP model and relying on your vendor to deliver AI features. Though many ERP vendors such as SAP offer AI features, they offer these AI features almost exclusively for cloud deployments, not for older on-premises ones. And, to get access to these AI features, your organization must reimplement its ERP system in the cloud, which often delivers little ROI and takes years to complete.
By taking a composable ERP approach and partnering with Rimini Street, you can deploy agentic AI “over the top” of your current on-premises ERP software to leverage features in your existing ERP system and remove the need for vendor-imposed ERP reimplementation or migration just to get access to AI features. With Agentic AI ERP, you benefit from automated processes previously performed by human labor without facing the financial and operational risks associated with ERP reimplementation and migration.
Key takeaways
Organizations are at a crossroads. Should you stick with the monolithic, subscription-based models of traditional ERP vendors? Or should you adopt a composable ERP strategy that allows you to leverage the power of Agentic AI ERP? By adopting a composable strategy with Agentic AI ERP, you can not only benefit from the freedom to pursue your own business roadmap but also get AI features and workflows without having to reimplement or migrate your existing ERP system.
In our latest whitepaper, we take you to the step-by-step path to Agentic AI ERP and the importance of taking action now for competitive advantage and growth. Read the full paper here.
