GSA OneGov Sets Global Benchmark for SAP’s Intelligent Enterprise

The U.S. federal government is often seen as a technological monolith, but the new GSA OneGov deal with SAP is changing that story. This partnership is a big, multi-year effort to go beyond basic cloud migration and create a secure, AI-driven, cloud-native operating system for public service. It could even set a new worldwide standard for large-scale SAP procurement.

On December 2, 2025, the U.S. General Services Administration (GSA) announced the landmark OneGov agreement with SAP, strengthening a nearly three-decade partnership and positioning the federal government as a global benchmark for digital modernization. The purpose of the deal is to accelerate technology modernization, help federal agencies transition away from legacy systems, and offer consolidated, discounted access to mission-critical SAP solutions, including database, integration, analytics, and cloud platforms.

Financial and Procurement Transformation

According to the GSA, there is an immediate benefit for US taxpayers. The OneGov offer is estimated to save $165 million for federal agencies over its duration, based on current government rates. The GSA’s FAS Commissioner, Josh Gruenbaum, emphasized that the agreement provides significant taxpayer savings while giving agencies access to essential tools.

The procurement structure is innovative on its own. By consolidating demand, the OneGov portfolio provides unprecedented price points, including:

• Up to 80% off on license-based products, such as SAP HANA, ASE, and PowerDesigner.
• 35% discount on key cloud services, including SAP Business Technology Platform (BTP), SAP Analytics Cloud, and HR Payroll.

This streamlined, transparent procurement model, as noted by SAP’s David Robinson, helps create “greater transparency, efficiency, and long-term value.”

Beyond Migration: The Shift to Innovation

Crucially, this initiative is not framed as a simple technology refresh but as an operating model. The strategic emphasis is on ongoing transformation where technology, mission, and operations develop together.

Mr. Robinson, President of Cloud ERP and Managing Director of U.S. Public Services at SAP, articulated this shift, stating that true transformation lies in reimagining operating models to support continuous, secure, and scalable innovation. Federal agencies are adopting future-ready, cloud-native architectures that prioritize interoperability, flexibility, and resilience. The agreement also aligns with the White House’s AI Action Plan, empowering agencies to leverage the AI-powered SAP Business Suite to eliminate inefficiencies and operate smarter.

Removing Roadblocks to Cloud Adoption

To facilitate quick and scalable adoption, the agreement tackles key technical friction points:

• Waived Egress Fees: SAP is avoiding data egress charges across government-certified hyperscaler environments.
• White Glove Support: Agencies receive additional benefits, including a dollar-for-dollar first-year modernization incentive and dedicated SAP Enterprise Architect support.

By emphasizing both efficiency and innovation, federal leaders now evaluate success through a dual focus: Total Cost of Ownership (TCO) and Total Cost to Innovate (TCI). This perspective ensures that modernization is viewed as an investment in agility and preparedness, furthering the U.S. federal government’s commitment to providing citizen-centric services at scale.

What This Means for SAPinsiders

Federal IT is now at the forefront of SAP adoption. The GSA OneGov agreement confirms that the market demand for cloud-native ERP and strategic platform use is speeding up across all complex, highly regulated sectors. This government-level commitment to removing technical debt through AI-powered core systems indicates that organizations must now focus on continuous IT modernization to stay competitive.

This shift emphasizes Total Cost to Innovate (TCI). SAP professionals should now focus on adopting flexible, future-ready architectures instead of customized legacy systems, which limit agility and innovation. Architects and project managers can use the precedent of waived data egress fees and modernization incentives to strengthen their business cases for rapid cloud transitions.

For technical teams, best practices should focus on creating a clean core and utilizing platforms like SAP BTP. The aim is to build secure, interoperable systems that enable continuous innovation—such as integrating AI capabilities—without modifying the core ERP code. This approach, designed to move faster and operate more intelligently, serves as the blueprint for keeping IT and mission operations aligned across any global enterprise.