Are You Digitally Ready for AI-Enhanced ERP?

Pat Phelan
VP, Market Research
3 min read
Are You Digitally Ready for AI-Enhanced ERP?

Many businesses are eyeing the potential of artificial intelligence (AI) and machine learning (ML) to transform ERP. Your ability to reap the rewards of that potential may depend on how far along you are with digital transformation.

A recent IDC report sponsored by Rimini Street, AI and ERP:  Intelligently Automating the Enterprise and Creating Differentiating Value, by Mickey North Rizza, Group Vice-President Enterprise Software, points out that 51% of businesses are running a digital business. However, “IDC’s research finds that 49% of organizations are still digitally transforming, so it’s clear the journey to a digital business can be difficult.”

The breakout launch last year of OpenAI’s ChatGPT generative AI chatbot has without doubt opened the floodgates of vendor AI promises. “2023 has been a break-out year for generative AI technology, as tools such as ChatGPT graduated from lab curiosity to household name,” CIO writes in a roundup of the latest generative AI announcements. “But CIOs are cautiously evaluating how to safely deploy generative AI in the enterprise, and what guard-rails to put around it.”

Keys to success

Before committing to any one software vendor’s AI roadmap, it’s probably wise to first evaluate your organization’s ability to automate and continuously innovate. “While this may sound easy, it isn’t,” Rizza writes.

Success, she adds, requires focus on enabling a cloud strategy, further automating all business processes, and exploring and applying continuous innovation opportunities such as AI.

“This focus isn’t always easy as organizations have much on their plate, including building a technology strategy to reshape the organization for the digital world, which means they must understand and modernize their current technology portfolio around the edges of their legacy on-premises solutions,” Rizza points out.

The benefits are worth it though: “In this case, ERP can quickly be enhanced with AI, yielding more intelligent insights, an ability for employees to quickly navigate and respond faster,  improving their decisioning and in turn boosting an organization’s performance,” she writes.

Rizza lays out several ERP use cases that organizations find more effective when AI is applied, such as improving manufacturing processes and the financial close process, along with improvement in business processes such as project management, product life cycle and fulfillment, and services management.

“With over 65% of organizations believing AI is critical to their ERP system, the AI and the innovation it can foster is now becoming mandatory for new ERP systems,” Rizza adds, while pointing out that Rimini Street is helping, “ERP clients migrate their products to the cloud and optimizing the organization’s time with an AI integrated workflow to make it easier to migrate to a new system.”

Is it really for you?

Not everyone concedes the benefits of AI and ERP, she says. “Organizations need to understand what is important for them and weigh all aspects of costs and benefits when it comes to creating and maintaining competitive advantage in the digital world.”

Many of Rimini Street’s clients come to us to avoid being pinned down by vendor roadmaps. ERP software vendors are forcing their customers to move from robust, stable systems to new and unproven platforms through forced end-of-mainstream-support deadlines and coercive audit or “limited time” license credit offers — without any clear ROI or business value.

It’s important to map your technology needs to business priorities. AI can help organizations scale with speed and agility and enhance digital workflows. As Rizza notes, “AI is an area many vendors are still experimenting with, so understanding its use both by a vendor and how that translates to clients is a critical parameter for every business to understand during the selection process.”

Learn more: For more of Rizza’s insights and survey data on AI benefits that organizations are realizing, read the full IDC report sponsored by Rimini Street.