This study focuses on examining the shift of an application system from a traditional monolithic architecture to a cloud-native microservice architecture (MSA), with a specific emphasis on the impact of this transition on resource efficiency and cost reduction. In order to evaluate whether artificial intelligence (AI) and application performance management (APM) tools can surpass traditional resource management methods in enhancing cost efficiency and operational performance, these advanced technologies are integrated. The research employs the refactor/rearchitect methodology to transition the system to a cloud-native framework, aiming to validate the enhanced capabilities of AI tools in optimizing cloud resources. The main objective of the study is to demonstrate how AI-driven strategies can facilitate more sustainable and economically efficient cloud computing environments, particularly in terms of managing and scaling resources. Moreover, the study aligns with model-based approaches that are prevalent in sustainable systems engineering by structuring cloud transformation through simulation-supported frameworks. It focuses on the synergy between endogenous AI integration within cloud management processes and the overarching goals of Industry 5.0, which emphasize sustainability and efficiency that not only benefit technological advancements but also enhance stakeholder engagement in a human-centric operational environment. This integration exemplifies how AI and cloud technology can contribute to more resilient and adaptive industrial and service systems, furthering the objectives of AI and sustainability initiatives.