Enterprises expand technology investments into coordinated initiatives for greater resilience, accuracy, efficiency, ISG Provider Lens® report says
Manufacturers are embedding digital systems in design, production and service operations to address multiple business and technology challenges, 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 global ISG Provider Lens® Manufacturing Industry Services and Solutions — Mid-Tier and Specialist IT Firms report finds that enterprises are shifting from isolated digital initiatives to coordinated programs that modernize legacy environments while delivering measurable operational gains. Manufacturers face mounting pressure from supply chain volatility, regulatory mandates and skills shortages, prompting investments to enable faster decision-making, improved asset utilization and tighter integration across IT and operational technology (OT) systems.
"Manufacturers are moving decisively toward digital operating models that balance innovation with control," said Bob Krohn, partner at ISG. "Mid-tier and specialist IT providers have the agility and domain expertise to support these efforts with modular solutions that can be integrated with legacy systems."
AI deployment in shop floors, engineering operations and supply chains is moving beyond experimentation and delivering enterprise benefits, the report says. AI-powered analytics, digital twins and predictive maintenance are increasingly embedded into core workflows to reduce downtime and improve the accuracy of forecasts. Manufacturers that adopt them can respond more quickly to shifts in demand while containing costs and operating more consistently.
Smart factory modernization is advancing as enterprises integrate IoT, robotics and real-time monitoring into production environments, ISG says. Manufacturers are replacing fragmented legacy systems with interoperable platforms that link together design, manufacturing and business processes. This approach strengthens quality control and shortens production cycles, providing the agility to navigate volatile market conditions.
Sustainability is becoming central to manufacturing technology strategies, especially in Europe, the report says. Enterprises are adopting digital platforms to implement carbon tracking, energy optimization and circular economy initiatives. These capabilities help organizations meet rising compliance requirements while aligning environmental goals with efficiency, risk management and long-term profitability.
"Digital technologies, customer expectations and sustainability demands are forcing manufacturers around the world to quickly adapt," said Swadhin Pradhan, principal analyst, ISG Provider Lens Research, and lead author of the report. "Agile providers are tailoring technology, transformation and consulting services to the needs of enterprises in different regions and industries."
The report also explores other trends affecting manufacturers, including supply chain regionalization, workforce augmentation through automation and the growing importance of cybersecurity as IT and OT environments converge.
For more insights into the challenges faced by manufacturing enterprises, along with ISG's advice for addressing them, see the ISG Provider Lens® Focal Points briefing here.
The 2025 global ISG Provider Lens® Manufacturing Industry Services and Solutions — Mid-Tier and Specialist IT Firms report evaluates the capabilities of 41 providers across four quadrants: Design and Development Services, Smart/Digital Factory Services, Supply Chain and Aftermarket Services and Technology, Transformation and Consulting Services.
The report names MHP as a Leader in all four quadrants. It names IndX, Hexaware, Hitachi Digital Services, ITC Infotech and Perficient as Leaders in three quadrants each. Birlasoft, Cyient, FPT Software, HARMAN DTS, LTTS, Persistent Systems, Quest Global, Randstad Digital, Stefanini, Tata Elxsi, UST and Zensar Technologies are named as Leaders in two quadrants each. ACL Digital, All for One Group, AXISCADES, eInfochips, Mastek, Nagarro, Softtek and Syntax are named as Leaders in one quadrant each.
In addition, All for One Group, Happiest Minds and ITC Infotech are named as Rising Stars — companies with a "promising portfolio" and "high future potential" by ISG's definition — in one quadrant each.
Customized versions of the report are available from Hexaware, LTTS, Stefanini and Softtek.
The 2025 global ISG Provider Lens® Manufacturing Industry Services and Solutions — Mid-Tier and Specialist IT Firms report 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.
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