Tata Consultancy Services extends its collaboration with SAP through a new five-year agreement, focusing on AI integration and cloud infrastructure to accelerate SAP’s digital modernisation and innovation efforts.
Tata Consultancy Services (TCS) has reaffirmed and expanded its long-standing partnership with SAP by signing a new five-year agreement aimed at accelerating the German software giant’s transition towards cloud computing and Generative Artificial Intel...
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ligence (GenAI) technologies. This collaboration marks over two decades of cooperation between the two companies and underscores a shared strategic focus on modernising SAP’s IT infrastructure, driving innovation, and enhancing operational agility.
Central to the agreement is TCS’s role in supporting SAP’s internal “SAP runs SAP” initiative, which seeks to simplify and optimise SAP’s IT landscape. By streamlining complex IT operations, TCS aims to enable faster development cycles, reduce total cost of ownership, and improve the alignment between SAP’s IT capabilities and its broader business goals. This modernisation effort is designed to help SAP respond more quickly to evolving customer demands and foster greater efficiency across its global operations.
A distinctive feature of the partnership is the establishment of four strategic Centres of Excellence, each dedicated to advancing key technological areas. One centre focuses on embedding Generative AI within SAP’s processes to drive automation and develop new use cases. Another is dedicated to the Business Technology Platform, accelerating innovation through low-code and no-code development tools. The Business Data Cloud centre aims to create a standardised data architecture that supports SAP’s goals of monetising enterprise data, while the Customer Experience centre is tasked with enhancing engagement and service delivery across SAP’s value chain. The creation of these centres exemplifies a proactive approach towards integrating AI and cloud technologies deeply into SAP’s business framework.
This deal reflects SAP’s broader shift from traditional licence and maintenance business models to cloud-based, usage-driven services, a transition TCS has supported extensively over recent years. According to company statements, TCS will be instrumental in reshaping SAP’s IT and business functions, leveraging AI to unlock new revenue streams and accelerate digital transformation. The partnership also aligns with SAP’s ‘RISE with SAP’ initiative, which helps customers migrate smoothly from on-premises infrastructure to cloud environments while enhancing scalability and agility.
Industry analysts have suggested that such multi-year IT modernisation programmes typically involve investments potentially reaching into the hundreds of millions of dollars, reflecting the scale and strategic importance of this deal. While the financial details of the agreement have not been disclosed, the growing emphasis on AI and cloud underlines SAP’s intent to maintain competitive differentiation in a fast-evolving enterprise technology market.
Executives from both firms have highlighted the trust and depth of their collaboration. Dr Benjamin Blau, SAP’s Chief Process & Information Officer, described the partnership as one built on trust and excellence, noting TCS’s crucial role in accelerating cloud adoption and simplifying customer journeys. Similarly, V Rajanna, President of Technology, Software and Services at TCS, emphasised the transformative potential of AI and cloud services in driving business growth and delivering differentiated experiences worldwide.
This expanded alliance comes at a time when enterprise technology companies face mounting pressure to streamline operations and leverage digital tools to enhance value propositions. By combining SAP’s industry-leading software solutions with TCS’s expertise in IT services and AI integration, both companies aim to set new standards for cloud-enabled, data-driven business transformation. Through this enhanced partnership, SAP anticipates strengthening its capacity to offer adaptive, intelligent solutions that meet the evolving needs of enterprises and their customers globally.
Source: Noah Wire Services
