Digital and AI capabilities could modernize the entire product development lifecycle, ISG Provider Lens™ report says
LONDON, April 25, 2025--(BUSINESS WIRE)--Europe is embracing digital engineering advancements faster than other regions, with more industries scaling Industry 4.0 initiatives and leveraging physical experience and digital intelligence capabilities to transform their workplaces and create customized experiences for end users, 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™ Digital Engineering Services report for Europe says enterprises and service providers have dramatically scaled their use of GenAI from the experimentation phase to the execution phase, using the technology across the product development lifecycle to automate design, enable hyperpersonalized customer experiences and create synthetic data for testing and model optimization. Service providers are helping enterprises create extended teams and design and build comprehensive solutions from product conceptualization to design, development and prototyping.
"Europe is significantly advancing its digital capabilities, which could potentially modernize the entire value chain from concept to after-sales support," said Matteo Gallina, ISG digital engineering solutions lead. "The paradigm shift toward agentic AI could transform industrial operations by enabling more automated decision-making, improving operational efficiency and streamlining production processes."
GenAI is enabling enterprises to hyper-personalize customer experiences by generating synthetic data for testing and optimizing design models, and identifying and generating outcomes customized to specific customer requirements. Digital twin technology gives enterprises virtual replicas of their industrial assets for real-time operational insights and predictive maintenance, and digital thread technology offers insights into those assets’ lifecycles, enabling end-to-end traceability of product data across the organization.
Service providers are increasingly using model-based systems engineering (MBSE) to design complex, smart, integrated and well-connected products. MBSE combines mechanical, electrical, electronic and software engineering disciplines. These new technologies may be especially transformative for automotive and manufacturing industries, where Europe is increasingly perceived as the world’s geographic hub.
"New technologies have generated an unprecedented wave of expectations among business users," said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. "Enterprises must rethink their approaches to building products and delivering services, and their service provider partners must help them move away from legacy infrastructure."
The report also explores other trends, including service providers’ work to develop software using more carbon-efficient methods, minimizing emissions throughout the development lifecycle. Composable architecture is helping developers more rapidly assemble more cohesive, adaptable systems that rely less upon new carbon consumption, giving their users greater flexibility to respond quickly to market changes.
For more insights into the digital engineering challenges faced by enterprises in Europe, including the shift to offering services as software and the need for a new talent mix to reshore manufacturing, plus ISG’s advice for addressing those challenges, see the ISG Provider Lens™ Focal Points briefing here.
The 2025 ISG Provider Lens™ Digital Engineering Services report for Europe evaluates the capabilities of 50 providers across four quadrants: Design & Development (Products, Services and Experiences), Integrated Customer / User Engagement, Intelligent Operations and Platform and Application Services.
The report names Accenture, Capgemini, Cognizant, HCLTech, Infosys, TCS and Wipro as Leaders in four quadrants each. HARMAN Tech Services, NTT DATA and Tech Mahindra are named Leaders in three quadrants each. Akkodis, Cyient, LTIMindtree, LTTS and Persistent Systems are named Leaders in two quadrants each. GlobalLogic is named a Leader in one quadrant.
In addition, Akkodis, GlobalLogic, ITC Infotech, LTTS and NTT DATA are named as Rising Stars — companies with a "promising portfolio" and "high future potential" by ISG’s definition — in one quadrant each.
In the area of customer experience, Persistent Systems is named the global ISG CX Star Performer for 2025 among digital engineering service providers. Persistent Systems earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.
The 2025 ISG Provider Lens™ Digital Engineering Services report for Europe 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.
