AI is transforming the way businesses operate and, consequently, the software they use to run their companies. However, many companies are spinning their wheels right now as they wrestle with difficult questions such as: how can we determine which AI solutions are actually worth our investment? Should we still be thinking in terms of traditional ERP architecture? And what role does our vendor play in offering a long-term, cohesive strategy joining AI and ERP?
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AI has influenced ERP automation for years, but the relationship between artificial intelligence and enterprise software strategies is evolving. Long before today’s AI capabilities, there were solutions like Materials Requirements Planning (MRP), a precursor to ERP, designed to help planners make purchasing decisions based on logic built into the software. While MRP introduced a new level of automation to business processes, it could only execute the rules and logic already programmed into the system.
Today, AI is changing what’s possible. Rather than relying solely on predefined rules, businesses can use AI to interact with their ERP systems in new ways that align with their unique business requirements. In this blog, ERP Advisors Group explores AI’s impact on ERP strategy and key considerations for evaluating software solutions.
AI is reshaping how ERP systems are configured, customized, and utilized. Today, nearly every major vendor has an AI strategy, making AI an increasingly important consideration when evaluating an ERP upgrade or new system. Rather than treating AI as an add-on to consider later, you should incorporate it into your ERP strategy from the beginning to ensure your technology can support evolving business needs.
AI is also changing the employee experience. Employees don’t want to spend their time on repetitive, manual tasks that can be easily automated. They want to focus on higher-value work requiring expertise and human judgment. By leveraging AI to automate routine processes, you can give your team more time to focus on work that truly drives the business forward.
There are many ways to leverage AI within your ERP system. For example, Epicor offers 18+ pre-built, specialized industry agents that support decision-critical workflows, while Sage Intacct is taking a broader approach to AI agents, with capabilities supporting processes such as financial close and assurance across the enterprise. Other vendors are developing broader AI capabilities, as well as tools for data visualization and AI agent orchestration. NetSuite, for example, offers Canvas, a digital workspace allowing users to visualize data and create presentation-ready outputs, within the NetSuite Next initiative. Alternatively, Rillet was architected around AI to enable capabilities such as AI-powered accruals and reconciliations linked to the core of what financial teams do every day. Microsoft has also incorporated AI across its broader business applications, while Infor is developing industry-specific AI capabilities within the software businesses already use.
While there’s no single approach to incorporating AI into an ERP strategy, you should assess whether a vendor’s AI capabilities align with your organization’s specific processes, goals, and long-term technology strategy. The goal isn’t simply to choose a vendor with the most AI features, but to understand how those capabilities can support the way your business operates today and where it is headed in the future.
Many businesses have relied on highly customized systems for decades. While those solutions may have met the organization’s needs when first implemented, business requirements, technology, and expectations have since changed. As AI becomes more integrated into the core of enterprise software platforms, you should be willing to evaluate whether your existing system can support your organization’s future direction or whether it’s time to consider a new ERP.
Adding layers of LLMs or AI agents to an outdated system or a heavily customized ERP can introduce challenges with an infrastructure that was not designed to support these modern technologies. You need to consider how AI will access and interpret your data, how information is secured, and how to minimize the risk of inaccurate or hallucinated outputs. Simply adding an AI tool on top of a legacy system does not necessarily create a modern, AI-focused ERP strategy.
Thankfully, ERP vendors like Microsoft, Epicor, and Infor have spent years developing enterprise applications. Because they understand the architecture, they have the expertise to integrate AI capabilities directly into the applications you rely on, ensuring that your ERP is built to support these technologies from the start.
This makes alignment with your ERP vendor especially important. If your organization wants to incorporate AI into business operations, your ERP vendor should be able to clearly outline its AI strategy, explain how AI works within its platform, and detail how it plans to keep your business data safe. If your current vendor isn’t having these conversations, it may be time to change.
When evaluating a new vendor or reassessing your current vendor, it’s important to look beyond today’s features and consider how their software will evolve alongside AI. There are three key selection criteria to consider when evaluating an ERP vendor’s long-term AI strategy.
Does the vendor support Model Context Protocol (MCP)? MCP establishes a connection between an LLM application and your enterprise software solution, enabling AI solutions to interact with your business systems and data. A vendor’s approach to MCP can provide insight into how well the software is prepared to connect with evolving AI technologies.
You should also consider how AI can be used to interact with and visualize data directly in the software. For example, could you ask the LLM, “What was my profit margin for customers in the region last month?” and have the system immediately provide that information? Being able to interact with your data directly within the ERP reduces the risk of hallucinations and delivers more relevant, contextualized results.
Lastly, you should determine whether your vendor has developed or is developing capabilities that enable users to build and deploy AI agents directly within the application. As AI becomes more integrated into existing enterprise software platforms, the ability to perform specific tasks and automate processes within your ERP will play a significant role in the value you derive from your system.
AI is expanding what ERP systems can do, making it more important than ever to consider AI capabilities as part of your long-term ERP strategy. Whether you're evaluating your existing system or considering a new ERP, it’s important to understand how your vendor plans to support the future of AI. The right vendor should not only meet your business needs today but also give you the flexibility to adapt as AI and enterprise technology continue to evolve. Start building your ERP strategy by scheduling a free consultation with one of our experts today!