SAP and IBM are turning ERP infrastructure into part of the AI readiness conversation. The companies announced on July 2 that JYSK, GBM, DIFARE Group, and Plastilene Group have selected SAP Cloud ERP Private on IBM Power Virtual Server to modernize their ERP workloads in secure, scalable cloud environments.
The customer list spans retail, technology services, pharmaceuticals, and manufacturing. It also gives SAP and IBM a cross-industry proof point for the modernization path of moving SAP workloads from long-running IBM Power environments into SAP Cloud ERP Private without forcing customers into a clean break from infrastructure they already know.
That makes this more than a RISE with SAP customer update. It is a reminder that AI-enabled ERP depends on the cloud foundation. Companies may want Joule, agents, better analytics, and SAP Business AI, but many still need a migration route that protects uptime, security, performance, and operational confidence.
Analysis
What this means: ERP modernization is an AI infrastructure decision. Customers cannot take advantage of embedded AI, agentic workflows, or real-time data products if the core ERP landscape remains too fragile to move. SAP and IBM are betting that trusted infrastructure can lower the perceived risk of private-cloud migration for customers with mission-critical SAP workloads.
The Private Cloud Path
SAP and IBM are targeting customers that want cloud ERP benefits without losing the resilience and performance characteristics of their existing SAP infrastructure.
SAP said the platform can help customers reduce total ownership cost through more granular scaling, support hybrid and multicloud deployments, migrate SAP Cloud ERP Private and SAP Business Warehouse as part of SAP Business Data Cloud, and reduce operational and security risk through IBM Power and IBM Cloud capabilities.
The customer examples show that pattern:
- JYSK, a Danish home furnishings retailer with more than 3,600 stores in 50 countries, is advancing its RISE with SAP journey with IBM.
- DIFARE Group, an Ecuador-based pharmaceutical group, is expanding from long-term IBM Power usage into SAP Cloud ERP Private.
- Plastilene Group, a Colombian flexible film manufacturer, selected IBM technology to modernize its SAP landscape with a focus on TCO and regional growth.
- GBM, an IT services company in Central America and the Caribbean, is using the platform to improve agility, scalability, and real-time insight.
These are companies that need modernization, but not at the expense of core system reliability. SAP and IBM are positioning IBM Power Virtual Server as a bridge for customers that want cloud ERP while preserving the operational confidence they associate with IBM Power.
AI Needs a Cleaner Core
SAP and IBM are also making the AI case more explicit. SAP cited IBM Institute for Business Value research that found companies embedding AI into ERP systems achieved up to 27% higher ROI.
The point is useful, but the bigger issue is architectural. AI in ERP may not successfully scale if the core system, data layer, and surrounding workflows are still trapped in brittle on-premises environments.
SAP Cloud ERP Private gives existing SAP customers a modernization path without forcing the standardization tradeoffs as a public-cloud ERP move. IBM adds infrastructure continuity for customers already invested in IBM Power, plus hybrid cloud and consulting capabilities around automation and AI.
AI-enabled finance, supply chain, procurement, HR, and manufacturing workflows require more than model access. They need secure data flows, resilient system performance, integration with adjacent systems, and governance over how automated decisions touch business processes.
Analysis
What this means: AI is raising the bar for ERP infrastructure. A cloud migration that once would have been justified by support timelines, cost, or technical debt is now being judged by whether it creates the foundation for AI-enabled workflows. For SAP customers, the question is shifting from “Can we move the core?” to “Can the core support the next operating model?”
Hybrid Cloud Still Has a Role
The announcement also shows why hybrid cloud remains relevant in ERP.
The cloud ERP market is often discussed as a move away from legacy infrastructure. In practice, many SAP customers are looking for a more controlled transition. They want cloud scalability and access to SAP innovation, but they also want to manage disruption, preserve security posture, and avoid unnecessary redesign of mission-critical workloads.
IBM’s pitch is built around that middle ground. Its RISE with SAP on IBM Power Virtual Server offering is aimed at moving SAP S/4HANA workloads from on-premises IBM Power Systems to the cloud while supporting customers that need resilient operations and enterprise-grade security.
That is especially relevant for industries where ERP downtime creates immediate business exposure. Retailers need store and supply chain systems to keep moving. Pharmaceutical companies need operational control and compliance. Manufacturers need stable production and logistics processes. Technology services companies need reliable platforms to support their own customers.
A private-cloud ERP migration is not just an IT architecture choice in those environments. It is a business-continuity decision.
The Agentic Layer Gets Closer
IBM and SAP recently expanded work around the Agent2Agent interoperability standard, tying infrastructure modernization to their broader agentic AI collaboration and allowing IBM Consulting Advantage agents to manage SAP Joule agents that work with IBM watsonx Orchestrate agents. IBM has also positioned watsonx Orchestrate as an agentic control plane for managing and governing agents across different frameworks and environments.
That agentic layer increases the importance of the ERP foundation.
If agents are going to act across business processes, they need trusted access to ERP data, reliable integration with workflows, and governance over what actions they can take. That becomes harder when the ERP landscape is fragmented, infrastructure capacity is constrained, or the organization lacks a clear path from core modernization to AI-enabled operations.
SAP and IBM are effectively connecting two messages: modernize the SAP core on infrastructure built for mission-critical workloads, then use that foundation to support AI and agentic process innovation.
Analysis
What this means: Agentic AI makes ERP resilience more important, not less. Once agents start working across finance, procurement, supply chain, and service workflows, the stability and governance of the underlying ERP platform becomes part of the AI control model. Infrastructure decisions will shape how safely and confidently companies can let AI act.
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The Real Migration Test
The customer momentum gives SAP and IBM a stronger story for SAP customers that are still weighing private-cloud ERP migration.
The challenge is execution. Moving ERP workloads to the cloud does not automatically create AI readiness. Customers still need clean data, simplified processes, integration discipline, business ownership, security controls, and a roadmap for adopting new SAP capabilities after migration.
But the announcement does clarify one part of the market. Some SAP customers do not want modernization to feel like a leap into unfamiliar infrastructure. They want a cloud path that respects the systems, risk profiles, and operating models that have supported the business for years.
That is where IBM Power Virtual Server gives SAP and IBM a specific route into the installed base. It gives customers a way to move forward without treating infrastructure continuity as a weakness.
For ERP leaders, the decision is practical. The cloud platform should not only support today’s SAP workloads; it should also give the business enough stability, scalability, and security to adopt the next wave of AI-driven ERP capabilities.
Analysis
What this means: Migration is not the finish line. SAP customers moving to Cloud ERP Private will still have to prove that the new environment improves agility, reduces operational risk, and creates a credible foundation for AI. The infrastructure choice matters because it determines how much confidence the business has to modernize the core and then keep improving it.
