In collaboration withRimini Street
The narrative of enterprise resource planning (ERP) fundamentally narrates how businesses have adapted to structure themselves around the cutting-edge technologies available throughout various eras. From the 1960s to the ’80s, mainframes, material requirements planning (MRP), and manufacturing resource planning (MRP II) transitioned essential business information from file cabinets to centralized systems. The client-server models characterized the ’80s and ’90s, bringing digital transformation into the mainstream during the early days of the internet. As we entered the 21st century, the shift from traditional desktops to SaaS and cloud solutions introduced flexible access and scalable infrastructure.
The emergence of composability and agentic AI signifies yet another new beginning—one well-suited for the evolving intelligence era. Composable architectures empower organizations to curate capabilities from diverse systems in a customizable fashion, allowing them to replace vendor-induced limitations with a tailored selection of purpose-built modules. Moreover, the advent of agentic AI facilitates collaboration among systems that were not initially intended to communicate.
Initial signs indicate that AI-empowered ERP will bring substantial performance enhancements: A 2024 research revealed that organizations utilizing AI-integrated ERP solutions could see approximately a 30% increase in user satisfaction and a 25% improvement in productivity; another study indicated that such solutions may reduce processing times by up to 45% and enhance decision accuracy by as much as 60%.
These twin advancements tackle enduring deficiencies that past ERP phases did not rectify: the ability to innovate beyond vendor strategies, the capability for rapid iteration, and genuine interoperability among all essential functions. This transition heralds the conclusion of monolithic reliance and presents a unique once-in-a-generation chance for early adopters to secure a competitive advantage.
Essential points to note include:
- Organizations are departing from dependent ERP vendor upgrades towards modular designs that enable them to modify or upgrade components independently while sustaining a stable core for vital transactions.
- Agentic AI serves as a timely enhancement to composability, acting as a user experience and orchestration layer that can synchronize workflows across various systems, transforming multi-step operations into automated, cross-platform tasks.
- These dual transitions are finally allowing technology frameworks to align with business needs rather than forcing businesses to adapt to ERP constraints. Enterprises can innovate by reconfiguring and extending existing systems instead of being reliant on ERP-led upgrades.
This material was created by Insights, the custom content division of MIT Technology Review. It was not authored by the editorial team of MIT Technology Review. It was formulated, developed, and composed by professional writers, editors, analysts, and illustrators. This encompassed the crafting of surveys and gathering of data for surveys. Any AI tools utilized were restricted to secondary production processes subject to thorough human scrutiny.
