Company Announcements

Modular engineering models improve speed, audit readiness and measurable outcomes, ISG Provider Lens^® report says

LONDON--(BUSINESS WIRE)--Apr. 15, 2026-- Enterprises in Europe are rapidly adopting AI-native and software-defined approaches to digital engineering to increase innovation speed, ensure regulatory compliance and achieve sustainable product development, 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 2026 ISG Provider Lens^® Digital Engineering Services (Large) report for Europe finds that enterprises are repositioning engineering as a core business function to deliver connected products, real-time services and circular value chains. This report evaluates large service providers with annual revenue over $2 billion, and a future report will focus on midsize providers.

New engineering approaches reflect evolving product lifecycles and the need to modernize legacy environments without compromising traceability or sustainability. Organizations are embedding AI, digital twins and structured engineering practices into workflows to improve efficiency, quality and governance. This practice also helps companies address fragmented data landscapes and evolving skill requirements.

“European enterprises are becoming more innovative and competitive by changing their approach to engineering,” said Dorotea Baljevic, director at ISG. “Many partner with large service providers that offer deep domain expertise, large-scale delivery and AI governance capabilities.”

Enterprises in Europe are embedding AI across development lifecycles to move toward autonomous and adaptive operations. Deploying agent-based systems and closed-loop optimization across design, production and service environments is enabling faster decision-making without compromising strict standards for explainability, validation and certification readiness. Enterprises are also investing in large language model operations and machine learning operations frameworks to ensure model governance, data lineage and risk control in regulated sectors.

European organizations are adopting model-based systems engineering and digital twins to shorten development cycles and improve product quality. Simulation-led validation and early-stage testing reduce reliance on physical prototypes and maintain auditability, while digital twins of products, manufacturing systems and field operations provide real-time insights into performance and risks. These capabilities help enterprises respond to supply chain disruptions and energy volatility and improve time to market.

Enterprises across Europe are modernizing legacy environments into modular and interoperable architectures to improve scalability and integration. Organizations are replacing product lifecycle management, manufacturing execution systems and enterprise resource planning platforms with cloud-based data fabrics and application programming interface-driven frameworks. This transition reduces system complexity and improves interoperability while enabling faster release cycles. At the same time, enterprises are establishing digital threads that connect data across the product lifecycle to support compliance, warranty analysis and sustainability initiatives, ISG says.

“Enterprises are aligning engineering transformation with business outcomes and regulatory expectations,” said Srinivasan PN, senior lead analyst at ISG and lead author of the report. “They are working with providers that offer modular delivery frameworks, governed AI and lifecycle traceability to enable faster innovation and sustainable growth.”

The report also explores other European trends in digital engineering services, including the increasing focus on digital thread implementations for end-to-end lifecycle visibility and the growing use of cross-functional, product-centric workforce models.

For more insights into the digital engineering-related challenges faced by enterprises in Europe, plus ISG’s advice for overcoming them, see the ISG Provider Lens Focal Points briefing here.

The report evaluates the capabilities of 26 providers across three quadrants: Augmented Design and R&D Services, Intelligent Operations and Connected Experiences and Integrated Platform and Application Services.

The report names Accenture, Akkodis, Capgemini, Cognizant, HCLTech, Infosys, TCS and Wipro as Leaders in all three quadrants. GlobalLogic, NTT DATA and Tech Mahindra are named as Leaders in two quadrants each.

In addition, Alten is recognized as a Rising Star — a company with a “promising portfolio” and “high future potential” by ISG’s definition — in two quadrants. CGI and Tech Mahindra are named as Rising Stars in one quadrant each.

In the area of customer experience, HCLTech is named the global ISG CX Star Performer for 2026 among large digital engineering service providers. HCLTech 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.

A customized version of the report is available from Akkodis.

The 2026 ISG Provider Lens Digital Engineering Services (Large) report for Europe is available to subscribers or for one-time purchase on 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260415423865/en/

Press:
Laura Hupprich, ISG
+1 203-517-3100
laura.hupprich@isg-one.com

Philipp Jaensch, ISG
+49 151 730 365 76
philipp.jaensch@isg-one.com

Source: Information Services Group, Inc.