Brazilian Enterprises Eye SAP Cloud Migration Challenges

Companies face pressure to modernize SAP as tax reform, regulatory changes drive demand for advanced technologies, ISG Provider Lens™ report says

SÃO PAULO--(BUSINESS WIRE)--A growing number of enterprises in Brazil are migrating to SAP S/4HANA and SAP’s SuccessFactors human capital management platform as they integrate new technologies and navigate a complex and changing regulatory environment, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm.

The 2025 ISG Provider Lens™ SAP Ecosystem report for Brazil finds that the impending end of support for legacy systems is the central challenge for SAP customers in the country. Though SAP offers extended maintenance for ERP Central Component (ECC) until 2030, official technical support is set to end in 2027. Companies are carefully evaluating alternatives to ensure business continuity, regulatory compliance and operations modernization. These include migrating to SAP S/4HANA or adopting the RISE with SAP or GROW with SAP programs, which the company says are designed to streamline business operations.

“Brazilian SAP customers face a reckoning with the end of ECC support and the need to comply with new regulations and tax reforms,” said Bill Huber, partner, digital platforms and solutions, for ISG. “Service providers are integrating AI and automation to meet the needs of different types of organizations.”

Large enterprises in Brazil continue to resist the RISE model, preferring to preserve budgets for internal improvements and prepare for the impact of new tax laws, the report says. However, some are adopting GROW with SAP to streamline operations, especially following mergers and acquisitions.

GROW combines several components for cloud transformation, including technology solutions and rapid implementation services, and is designed primarily for midsize businesses, ISG says. Some companies believe GROW lacks maturity, especially in its localization capabilities, but some service providers in Brazil report significant revenue from it, which may demonstrate that it meets a wide range of client needs when well executed, ISG says.

The use of SAP managed application services in Brazil has declined with the emergence of new AI and automation technologies, the report says. Providers are expected to align their solutions with the new technologies, with the services evolving into a more agile and intelligent model that includes automation and real-time monitoring to cut costs and increase productivity.

Interest in SAP SuccessFactors HXM has grown in Brazil as enterprises seek to customize recruitment, onboarding and performance evaluation through AI, ISG says. There is strong demand for solutions that enable compliance with Brazilian legislation on issues such as payroll administration, time management and taxes.

“Brazil’s changing regulatory and tax landscape requires constant enterprise attention,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “SAP users should partner with providers that remain up to date and agile to ensure continued compliance.”

The report also examines other SAP ecosystem trends affecting enterprises in Brazil, including SAP’s extensions to its Joule AI copilot and the continued importance of managed cloud services for SAP ERP.

For more insights into the SAP-related challenges facing enterprises in Brazil, plus ISG’s advice for addressing them, see the ISG Provider Lens™ Focal Points briefing here.

The 2025 ISG Provider Lens™ SAP Ecosystem report for Brazil evaluates the capabilities of 45 providers across five quadrants: SAP S/4HANA System Transformation — Large Accounts, SAP S/4HANA System Transformation — Midmarket, SAP Application Managed Services, Managed Cloud Services for SAP ERP and SAP SuccessFactors HXM Partner Services.

The report names Accenture, Atos, Capgemini, Deloitte and T-Systems as Leaders in four quadrants each. It names NTT DATA and Wipro as Leaders in three quadrants each and Infosys, Softtek, Stefanini and Tech Mahindra as Leaders in two quadrants each. BCI Consulting, EPI-USE, Essence, Exed Consulting, HR Path, HRST, Kyndryl, Megawork, Meta, Numen, SEIDOR, Strada and TIVIT are named as Leaders in one quadrant each.

In addition, Minsait is named as a Rising Star — a company with a “promising portfolio” and “high future potential” by ISG’s definition — in two quadrants. Engine and SPS Group are named as Rising Stars in one quadrant each.

Customized versions of the report are available from Megawork, Meta and NTT DATA.

In the area of customer experience, Wipro is named the global ISG CX Star Performer for 2024 among SAP ecosystem providers. Wipro earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, which is part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.

The 2025 ISG Provider Lens™ SAP Ecosystem report for Brazil is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Mexico, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

About ISG

ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.