ISG to Evaluate Digital Engineering Services Being Transformed by AI

Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm, has launched a research study examining digital engineering services providers that are leveraging AI to help customers improve all aspects of their digital enterprise.

The study results will be published in two comprehensive ISG Provider Lens reports, called Digital Engineering Services 2025, scheduled for release in April 2025. The geographically focused reports will cover providers supporting AI-driven design and development, integrated customer and user engagement, platform and application services and intelligent operations, with a special focus on the transformative impact of generative AI (GenAI) on engineering and business operations.

Enterprise buyers will be able to use information from the reports to evaluate their current vendor relationships, potential new engagements and available offerings, while ISG advisors use the information to recommend providers to the firm’s buy-side clients.

GenAI is transforming the value of digital engineering, from ideation and virtual prototyping to simulations and large-scale testing. Large language models (LLM) used in training GenAI are streamlining common engineering processes, including document generation, technical search and retrieval, and visual language models (VLM) are generating detailed specifications from 3D models.

“Systems endowed with modern AI can predict failures, optimize workflows and enable efficient remote operations,” said Namratha Dharshan, chief business leader, ISG Research. “They can add value to engineering processes with aftermarket services, including intelligent chatbots, real-time support and predictive system maintenance.”

ISG has distributed surveys to more than 80 digital engineering service providers serving the Europe and the U.S. markets. Working in collaboration with ISG’s global advisors, the research team will produce four quadrants representing the digital engineering services the typical enterprise is buying based on ISG’s experience working with its clients. The four quadrants are:

• Design and Development (Products, Services and Experiences) evaluating providers of services for integrated hardware/software development and feature augmentation, including new data-driven methods and agile design, that yield faster innovation cycles, accelerated time-to-market and improved customer experiences.
• Integrated Customer/User Engagement assessing providers of intelligent aftermarket services for product support through digital platforms. Critical capabilities in this segment include providing AI-enabled customer service, remote field support with AR/VR technologies and self-service knowledge support.
• Intelligent Operations evaluating providers enabling intelligent operations across industries, particularly within legacy factories and production plants, helping to make operations at greenfield and brownfield sites more connected and autonomous, thereby reducing dependence on manual intervention and increasing efficiency.
• Platforms and Application Services covering providers’ ability to design and deliver digital platform engineering competencies. Key capabilities include business and technical design proficiency, building new experiences, and leveraging digital ecosystems, orchestration platforms and microservices-based architectures.

Geographically focused reports from the study will cover the global digital engineering services market and examine products and services available in the U.S. and Europe. ISG analysts Srinivasan P N (Europe) and Dr. Tapati Bandopadhyay (U.S.) will serve as lead authors of the reports.