What happens if SAP’s S/4HANA roadmap doesn’t suit?

The news that Kingfisher rejected migrating to SAP S/4HANA reverberated around the internet in late 2025. The retail giant — which shifted its core ECC system to Google Cloud with support from Rimini Street and added AI, personalization, and recommendation engines— is already seeing benefits.

“It’s a perfect example of an evaluation of the cost and risk of sticking with SAP,” says John Burns, senior director of financial systems and controls at Summit BHC. “At some point, they’ll have to make a move, but they’ve given themselves breathing room at a fraction of the cost,” adds Burns, who’s spent decades specializing in ERP transformations.

SAP’s 2027 deadline for the end of mainstream support for ECC is creating hesitation and confusion as CIOs weigh the move to S/4 HANA via Rise, SAP’s cloud-based subscription ERP package.

There is the promise of AI automation, improved scalability, and future innovation, but cost uncertainties, loss of customizations, and other changes are making the business case hard to justify for some CIOs.

“CIOs should assess SAP’s roadmap the same way they evaluate any other business decision — by asking whether it makes sense. Transitioning from ECC to S/4 requires a complete re-implementation, which can be costly and disruptive,” says Burns.

It also raises the question of whether a larger shift is taking place. As agentic AI takes off and organizations seek more flexibility, the wholesale ERP upgrade isn’t the only choice.

“The era of a single monolithic ERP trying to manage every function is being replaced by agile, modular platforms that better reflect how businesses work in an increasingly dynamic world,” says Amit Basu, CIO and CISO at International Seaways.

Now may be the time to reassess whether a mandatory migration aligns with the long-term architecture and whether cloud-native or composable alternatives offer better agility.

“CIOs should assess flexibility, long-term cost transparency, and alignment with their digital strategy,” Basu suggests.

The changing dynamics of ERP modernization

SAP modernization is often complex due to heavy customizations, significant migration costs, and the organizational effort required to redesign processes.

“These challenges frequently push enterprises to consider phased modernization, hybrid models, or targeted extensions rather than a single, large-scale change,” says Basu.

Basu and the team implemented Oracle’s ERP cloud in 2018, and the focus now is maximizing value from the modern core by improving processes, strengthening data, and adding new functionality through APIs.

“The trend is moving toward keeping a strong financial core and extending capabilities through specialized modules rather than relying on a single monolithic system,” he says.

As the adoption of AI accelerates, particularly around agentic workflows, automation, and data-driven decisioning, organizations are seeking more agility and flexibility across their ERP platform. Monolithic ERP platforms and “big bang” transformations may no longer suit all organizations.

“If ECC is stable and the ‘upgrade’ offers no significant advantages, there’s no need to proceed with the transition. You’re not falling behind; you are being practical,” Summit’s Burns says.

His advice to CIOs is to identify how SAP’s plan addresses their issues or whether it’s more of a sales strategy. “Ultimately, the focus should be on resisting external pressures, disregarding arbitrary deadlines, and choosing the path that truly benefits your business, not just the one that benefits the vendor,” he says.

Burns believes opting not to make the wholesale SAP migration right now is a practical decision that acknowledges there are choices. “Seeking alternatives to SAP should not be seen as a drastic move,” he tells CIO.

What is clear is that ERP modernization is more than a technology upgrade — it’s a strategic organizational decision.

“Many CIOs see it as an opportunity to reassess whether a mandatory migration aligns with their long-term architecture and whether cloud-native or composable alternatives offer better agility,” says Basu.

Three broad paths have emerged: modernize around ECC, adopt a composable architecture, or evaluate alternative ERP platforms.

Keep the core and innovate at the edges

One of the options, experts say, is to “innovate at the edges,” which involves retaining SAP ECC as the stable core and modernizing other elements. This approach may appeal to organizations that want to reinvest the time and funds saved into innovation, while giving themselves a runway to an eventual move to S/4HANA.

Summit’s Burns recommends organizations keep core ERP systems “as vanilla as possible” to reduce customizations, allow for easier upgrades, and use external systems for AI and other advanced features. “You can extract the ERP data, for example via SQL into BigQuery, and then develop AI agents that access that transactional data and effectively become the face of the ERP system.”

But he stresses that your house needs to be in order to make it work — and that this approach isn’t a shortcut to innovation.

“If your data is messy or your processes are inconsistent, splitting the layers will not fix that. The core still has to be clean, and the front end still has to be governed. When those pieces are in place, the approach works very well,” Burns says.

This “phase zero” is the critical preparatory phase where people, processes, data, and policies must be standardized and fully aligned — or trouble follows. “That data is your starting point and you need good, clean, reliable data that everybody believes in to put into your new system,” he says.

Joe Locandro, global CIO at Rimini Street, believes the term “legacy” helps software vendors encourage upgrades, but newer isn’t always the best. In short, longevity should be seen as a positive feature, not a flaw. “Systems like SAP are robust and valuable, and modernization doesn’t always mean abandoning them,” he says.

He believes it’s a paradigm shift in thinking, urging CIOs to see the value of adapting incrementally and maintaining flexibility — and maximizing the value of their existing system.

“You’ve got an asset on your books that you can keep running till 2040 or beyond, but if you give up perpetual licenses, there’s no going back,” Locandro tells CIO. “Sweat the asset and build outside of it.”

Locandro suggests that “back office” functions such as finance and HR are steady and suitable to retain on-premises while others can be moved to the cloud. “Ecommerce and other ones that spike with load are probably well suited to a cloud environment, because you can burst very quickly and just use what you want,” he explains.

“You can have an Oracle, an SAP, or whatever underneath and put new screens developed through ServiceNow or Microsoft and new workflows on top. It’s headless. All the innovation, workflows, and screens look nothing like the old green screens and the buttons of SAP,” he says. “Innovate on top at whatever speed and cost you can afford and keep going down this path until you start dropping out bits underneath because you’ve built so much of the functionality above.”

The path to composable ERP

The logic for the past 20 years has been that consolidation and standardization in IT drive costs down, but that has changed as organizations seek greater flexibility to adapt to changing conditions and new technology.

Modular or composable ERP, a term first popularized by Gartner, decouples specific processes or services from the ERP core, allowing organizations to add functionality as needed, within or outside the vendor ecosystem. It’s gaining interest as CIOs rethink their approach to SAP modernization.

SAP has been embracing composability with modular services such as SuccessFactors, analytics, and its Business Technology Platform. However, the SAP deadline and the explosion in AI have heightened interest in a true composable approach that avoids vendor lock-in and the costs and limitations that go with this.

A recent Rimini Street survey found 83% of respondents see value in composable approaches for faster access to emerging technologies such as AI, while 94% highlight the freedom to choose best‑fit solutions for each business need.

“CIOs and management have realized that while you’ve got the lowest cost to operate, you’ve given up the flexibility, speed to market, and innovation, and in a digitized world, that’s mattering more. I think that tipping point changed in the last few years, especially with AI,” says Locandro.

Basu agrees that a composable approach reduces vendor lock-in and enables ERP systems to evolve continuously rather than through disruptive overhauls. “The future will not be defined by SAP or any single vendor. Composable ERP represents the new model where ERP is an ecosystem of modular, cloud-based applications that integrate through APIs,” Basu says.

“Companies retain a strong financial and data core, while procurement, planning, analytics, and automation are the best candidates for modular extensions. APIs allow these components to coexist without disrupting the core,” he adds.

It also opens the door to innovation through AI. In particular, agentic AI is accelerating the shift toward composable ERP because it can orchestrate work across multiple tools without needing a single vendor for everything. “Agentic workflows thrive in architectures with open data access and strong APIs,” Basu says.

Burns suggests that processes like procure-to-pay can be modularized and run outside the ERP system, with required data fed back in. “It can almost modularize itself, meaning you take care of the procurement piece, the accounts payable piece, and then the payments piece separately.”

He’s exploring this approach in real-world applications. “I’m looking at building an AI AP processing where it would get the invoices, read the invoices and then put them into the ERP system, and this would be done completely outside of the ERP but still feeding the data in,” Burns says.

Having the ability to swap out or upgrade components makes it easier to harness new and emerging micro-solutions. “There are some startups building outstanding products that are like mini systems that will take place of pieces of the ERP system, such as modules, sub-modules or sub-ledgers and they’ll do it extremely well because they’re very focused on that piece of it,” he says.

Weighing cloud-native ERP options

If CIOs want to plot a course away from SAP, they must first assess their organization’s needs. Checklists should consider scalability, ability to support global operations, security, data architecture, integration maturity, analytics strength, and the ecosystem. Then they need to assess the viability of alternative paths, such as other ERP platforms, innovating around the edges, or adopting a composable strategy.

Cloud-native platforms and industry-specific solutions have matured significantly, according to Basu, but reference checks with similar-size firms are needed to validate maturity.

Summit’s Burns echoes the sentiment, noting that Oracle is one of the few enterprise-scale alternatives. “But large global enterprises may struggle to leave SAP due to the depth of capability, especially in manufacturing and logistics,” he says.

CIOs may be wary that alternatives won’t be able to handle the full scope of work, and experts such as Burns believe the hesitation may be well founded. “Midmarket systems look great until you throw real transaction volume, messy edge cases, or multi-entity needs at them. If they fall apart there, it’s a non-starter,” he says.

Vendors must be mature enough to provide a full suite of services. For example, if every question gets answered with “coming soon,” that’s a red flag.

“Some of these platforms are great, but the companies behind them are still figuring out support models, roadmaps, and scalability,” Burns adds.

CIOs also need to pay attention to implementation partners, not just the vendors themselves.

“Midmarket ERPs often rely on small implementation shops that may not be equipped for complex environments. A good product with a weak partner network is going to hurt you,” Burns warns.

Finally, CIOs need to pay attention to how vendors respond when pushed. “Ask about limits, failures, ugly corners. If they get defensive or start hand-waving, walk away. The good vendors are honest about what they can’t do yet,” Burns says. “CIOs should ignore the hype and focus on two things. Can this platform run my business today? And will this vendor still be standing five years from now when I need them? If the answer to both is yes, you’ve got a contender. If not, it doesn’t matter how ‘cloud-native’ they are.”

The key message is that longevity isn’t the problem, nor is delaying migration and canvassing options. And now more than ever, AI isn’t a reason for wholesale transformation — it’s a reason to explore alternative paths.

Whether CIOs opt to migrate to S/4HANA, modernize around ECC, or take another path, decisions must center on the needs of the organization itself. And what architecture gives the business the most flexibility, resilience, and room to innovate.