Once again the move into a new year offers an excellent opportunity to look at the trends that will dominate business technologies in 2025. In this Insights news post we provide an updated look at the four key areas of AI, Cloud, Compliance and Sustainability. Although these topics have been on our radar in past years, the outlook for 2025 holds a common thread as the accumulated innovation and investment in each of these areas morphs into tangible acceleration, scalability and productivity payoffs going forward.
The Spread of Agentic AI
Over the past two years, the rise of Generative AI applications, started by Open AI's ChatGPT and quickly followed by big players such as Google, Meta, Apple and more, have radically changed the world of business and personal usage cases for leveraging artificial intelligence. AI chatbots use generative AI to provide responses based on interactions from specific prompts. The user makes a query and the chatbot uses natural language processing to reply with information from its large language model (LLM) training.
The next frontier of artificial intelligence that is accelerating in 2025 is agentic AI, which uses sophisticated reasoning and iterative planning to autonomously solve complex, multi-step problems. Agentic AI refers to artificial intelligence systems designed to perform tasks proactively, often with autonomy, decision-making, and adaptability. Unlike passive AI systems that require explicit input to function (e.g., rule-based systems or static algorithms), agentic AI operates with a sense of "agency," meaning it can make decisions, take actions, and interact with its environment to achieve specific goals, often adapting to changing circumstances.
Key Features of Agentic AI include:
- Autonomy: Ability to perform tasks independently without constant human oversight.
- Proactivity: Initiates actions to achieve goals rather than waiting for commands.
- Adaptability: Learns and adjusts its behavior based on new information or changing environments.
- Goal-Oriented Behavior: Operates with predefined objectives or self-directed goals in more advanced scenarios.
Modern agentic AI integrates machine learning (ML), reinforcement learning, and deep learning models to improve decision-making. These systems are becoming more contextually aware, learning from large datasets, and refining their behavior. In 2025 we can expect agentic AI to permeate industries like healthcare, logistics, manufacturing, and customer service, as well as improving business operations in areas such as finance, compliance and process optimization. In 2025, agentic AI's autonomous decision-making in these areas will improve efficiency, enhance agility, and reduce costs.
One of the key factors for success with agentic AI applications will be providing secure access to enterprise wide data sets for real-time analysis and decision making. SAP Joule is a prime example of leveraging embedded agentic AI as a seamless part of the overall business software landscape. Key points about SAP Joule as an agentic AI Include:
- Interactive capabilities: Joule can respond to natural language queries and provide relevant information or take actions.
- Context awareness: Joule leverages user context and business data to tailor its responses and recommendations.
- Integration with SAP systems: Joule is designed to seamlessly integrate with various SAP applications and modules, allowing it to access and manipulate data across the platform.
- Goal-oriented actions: Like other agentic AI systems, Joule can be programmed to achieve specific goals based on user input and/or pre-defined business objectives.
Accelerating Adoption of Enterprise-Wide SAP S/4HANA Cloud ERP Solutions
Another key area where progress during 2024 has set up a major tipping point for radical transformation in 2025 is regarding enterprise level migration to cloud ERP SaaS based solutions, such as SAP ERP Cloud Public and Private Editions.
As of Q2 2024, about 37% of SAP ECC customers globally had either purchased or subscribed to S/4HANA licenses, as reported by Gartner. With a significant portion of the market still untapped, the approaching 2027 deadline for mainstream ECC support, the high costs of extending that support, and a notable increase in RFP activity, all indicate a forthcoming wave of mass adoption for the remaining 63%. During the same timeframe, 60% of S/4HANA sales were to new clients, with 41% opting for RISE and 45% for GROW, both of which are cloud enablement solutions. These figures clearly demonstrate a consistent rise in new customers adopting S/4HANA through these methods.
Until recently, large enterprises had been hesitant to adopt Public Cloud solutions because many companies were operating with intricate customizations to which they were fully committed. However, with the impending end of mainstream support for ECC and the associated costs of extending it, along with the competitive edge provided by SAP SaaS with embedded AI, businesses are now viewing GROW and RISE from a fresh perspective. As detailed in previous Insights posts, both GROW and RISE with SAP are designed to support smooth customer transformation journeys from their unique starting points by leveraging the SAP modular ERP cloud architecture. The core cloud ERP can be SAP S/4HANA in either Public or Private cloud deployments.
Also, other SAP tools are available to help smooth the transition. Signavio and LeanIX help provide insights into business processes and identify opportunities for process improvement. WalkMe is a great tool to help companies improve User Adoption and help end-users move from the old way to doing things to new, more user friendly ways. SAP's Digital Discovery Assessment (DDA) also helps companies gain clarity and vision on their roadmap to the future. These tools enable customers to understand the journey they are embarking on, focus on the opportunities for improvement and real ROI, and help ensure that the ROI is realized by increasing user adoption and usability.
Moreover, the SAP Clean Core concept serves as a crucial architectural strategy to maintain ongoing stability, scalability, and sustainability for SAP Cloud ERP implementations. This strategic approach allows organizations to adopt cloud ERP solutions more efficiently by emphasizing standardization and reducing customizations. This results in lower costs, quicker implementation, and improved adaptability, setting companies up for success in an increasingly digital business environment. Essentially, Clean Core offers a standardized version of SAP S/4HANA ERP systems that minimizes customizations and focuses on utilizing SAP's built-in operations, processes, data, and integration. It also incorporates extensibility mechanisms that allow companies to implement specific customizations without altering the core system.
Integrating Compliance & Reporting into New Business Models
The intersection of ever-evolving compliance mandates and the rise of subscription-based offerings in the Digital Solutions Economy have created an environment where companies need both the agility to innovate new recurring revenue models and the built in disciplines for complying with revenue recognition, lease accounting and other accounting requirements.
According to Gartner, "75% of organizations selling direct to consumers will offer subscription services. And we see that this trend is definitively not restricted to B2C model, while the lines between B2B and B2C are blurring.”
Additionally, companies already within the SAP ecosystem or those planning to transition to SAP must ensure their subscription business setups offer a seamless transition to SAP S/4HANA in the cloud. Organizations migrating from ECC or on-premises systems seek efficient methods to expedite their subscription management, billing, and revenue compliance into the highly scalable SAP Cloud Public or Private Edition environments. Meanwhile, companies aiming to establish new greenfield implementations in SAP Cloud Public Edition require a straightforward approach to swiftly develop their end-to-end processes in S/4HANA, minimizing unnecessary complexity.
The holistic set of capabilities now available within the SAP Cloud offer an excellent starting point and comprehensive integration capabilities for bringing together the entire end-to-end Quote-to-Cash-to-Compliance process within the unifying umbrella of S/4HANA. SAP offers a wide range of options to select from, all of which take advantage of the seamless nature of the end-to-end SAP ecosystem and its unified data structures.
With a 28 year track record as one of SAP's longest serving partners and the recognized experts in SAP revenue compliance and SAP BRIM/OTC offerings, the Bramasol team has deep experience tailoring SAP solutions to specific client requirements. We leveraged this experience to create our purpose-built Qualified Partner Packed Solution (QPPS) that provides a turnkey, rapid-deployment, end-to-end methodology to implement subscriptions and bundled product/services offerings with seamless revenue compliance in SAP S/4HANA Cloud.
This focused QPPS approach not only addresses all the requirements needed to rapidly implement, manage, and scale a subscription-based business to take advantage of recurring revenue opportunities; it also establishes a solid foundation that can be extended and adapted to accommodate any future requirements simply by integrating other SAP applications without requiring a wholesale makeover.
Leveraging Sustainability Accounting for Competitive Advantage
It's clear that new global, national, and local regulations have been a major catalyst for initial ESG implementation. However, companies are also increasingly realizing the significant advantages that extend beyond mere compliance with ESG mandates. By focusing on ESG and adopting forward-thinking strategies, large enterprises can enhance their reputation, resilience, and value in a business environment that is becoming more ESG-focused.
Key benefits of a robust sustainability program include:
- Top-line Revenue Growth - by attracting customers and partners with more sustainable products and services that meet the rising demand for environmentally responsible corporate offerings.
- Cost Reduction - by decreasing energy, water, and material expenses and avoiding inefficient manufacturing, packaging, and shipping practices.
- Employee Commitment and Productivity - by boosting motivation, attracting talent, and nurturing a corporate culture centered on a shared commitment to environmental excellence.
- Leveraging Regulatory Compliance - by attracting investment from funds and individuals who prioritize ESG values and by avoiding fines and sanctions.
This is why SAP is advocating for the innovative green ledger initiative to ensure corporate climate accountability. A green ledger modifies financial practices, processes, and disciplines to account for Greenhouse Gas (GHG) emissions in the same manner companies manage their financials today. This method facilitates integrated financial and environmental decision-making throughout various stages of the business process.
The SAP green ledger builds upon and unifies all previous SAP-led carbon accounting and ESG solutions, such as SAP Sustainability Footprint Management, SAP Circular Economy, and SAP Sustainability Control Tower. The SAP green ledger offers bottom-up, audit-ready sustainability metrics that are managed with the same accuracy as corporate financial data. By processing actual sustainability data at a transactional level instead of relying on estimates or averages, businesses can gain a comprehensive view of their value chains to identify where emissions occur.
This enables them to set precise net-zero targets and pinpoint specific areas for decarbonization. With transactional carbon accounting in a green ledger, companies can make informed, precise, and timely decisions that are both financially and environmentally sound. By utilizing SAP's extensive range of sustainability solutions, companies can not only lower the cost of complying with ESG requirements; more importantly, they can uncover additional sustainability-related cost savings across their entire operations.
Summary
As we move into 2025, the overarching theme across these four important trends is a sense of action and acceleration. In each area, years of planning, innovating and foundational investment is now shifting toward tangible implementation projects that are bearing fruit in terms of productivity, scalability, and bottom line business results.
At Bramasol, the entire team is excited to help lead this next step toward manifesting real world results because taking clients from Insights to Action is a core part of our company culture and DNA. We firmly believe that knowledge and skills are important. That's why we have invested in building a team of recognized experts on SAP solutions for compliance, order-to-cash, subscription billing, leasing, finance and other solutions for the Office of the CFO.
But the real payoff from having skills and knowledge comes in the "action phase" where each specific client company's needs and goals are used to drive cost-effective and transformative implementation programs that make a tangible difference. While it's important to zoom out and look at these overarching trends that all companies should keep in mind for 2025, from our perspective, turning these insights into measurable and sustainable improvements for your unique company requirements is even more important.