Press Release

Explosion in App Economy Transforming ADM

ISG Provider Lens™ report finds digital transformation fueling demand for next-gen ADM

Business growth, customer experience, security and mobility at the heart of new applications

Automation reducing maintenance costs by 20-30%; savings reinvested in development

Company Release - 9/7/2018 1:17 PM ET

STAMFORD, Conn., Sept. 7, 2018 /PRNewswire/ -- The explosion in the applications economy – where apps are being used for everything from improving customer experience to running smart factories – is transforming traditional applications development and maintenance (ADM) services and causing a major shift in provider offerings, according to a new report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The ISG Provider Lens™ Next-Gen Application Development & Maintenance (ADM) Services Quadrant Report finds that ADM has moved beyond being a support mechanism for IT and branched out into such "next-gen" areas as analytics, Internet of Things (IoT), cloud-native architecture, Software-as-a-Service (SaaS)-based offerings, security, customer experience, mobile and more.

"Most next-gen development activities are focused on solving business problems, improving revenue and profits, delivering superior customer experiences and enhancing overall brand value," said Esteban Herrera, partner and global leader of ISG Research. "At the same time, next-gen maintenance is focused on leveraging intelligent automation to reduce costs by 20 to 30 percent – savings that can be reinvested in development activities."

In the world of agile development, rapid application development is on the rise, as enterprises quickly add new features to existing apps and roll out new ones. ISG finds enterprises prefer to partner with providers offering globally distributed agile capabilities that balance speed and cost. To overcome coordination hurdles, they also prefer "full-stack" developers that offer "360-degree" services from back-end to front-end. ISG also notes "DevSecOps" is becoming "the new normal" as security is being incorporated as a "default feature" in new apps.

Applications testing services, ISG says, are increasingly being automated and enterprises are looking to work with providers to build test automation centers of excellence and to have the providers run them initially. Enterprises also are seeking vertically driven capabilities, including industry-specific tools, reusable scripts and accelerators. Testing is seen as an enabler of emerging technologies, particularly in IoT applications, and full-stack engineers are in high demand to ensure continuous integration and testing for public cloud and other virtual environments, ISG says.

Among other findings, ISG notes that intelligent automation is being used in ADM to diagnose, predict and remediate non-linear problems, freeing ADM teams to focus on higher-value work. And with more cloud-native apps being created, the report finds enterprises are seeking providers capable of migrating and maintaining apps across cloud platforms in hybrid environments.

The ISG report also examines next-gen ADM trends impacting three verticals: Banking, Financial Services and Insurance (BFSI); Healthcare and Life Sciences (HCLS), and Manufacturing.

In the BFSI space, ISG notes the growing use of blockchain for processing transactions; advanced data analytics to meet and anticipate customer needs, and customer-first, design-thinking approaches to application development and delivery. ISG also finds public cloud is becoming "the default services model" in this sector.

In Healthcare and Life Sciences, applications maintenance savings are being used to fund data-driven change initiatives aimed at improving patient care and clinical decisions. Cloud adoption also is accelerating to improve process efficiencies in drug development and boosting connectivity and information access among practitioners, payers and patients.

In Manufacturing, enterprises are scaling up their use of IoT to create more agile and efficient "smart" factories that enable predictive maintenance, self-optimizing production and automated inventory management. Blockchain-based "omni-chain" models are disrupting supply chains, and cloud and mobility are being used to form connected ecosystems of suppliers, manufacturers, customers and partners, ISG found.

The ISG Provider Lens Next-Gen ADM Services Quadrant Report evaluates the capabilities of 29 global ADM providers across six quadrants: Next-Gen ADM, Agile Development, Continuous Testing, Next-Gen ADM – BFSI, Next-Gen ADM – HCLS, and Next-Gen ADM - Manufacturing. Capgemini, Cognizant, DXC Technology, HCL and Infosys were the only providers to be named global market leaders across all six quadrants.

Customized versions of the global report are available from DXC Technology, Hexaware, Infosys and Mindtree.

A separate report, evaluating 29 providers serving the U.S. market, named HCL and Infosys as the only market leaders across all six quadrants. Those earning the distinction across five quadrants were Cognizant, DXC Technology and IBM.

Customized versions of the U.S. report are available from Capgemini, Cognizant, Infosys, LTI and Mindtree.

The ISG Provider Lens Next-Gen ADM Quadrant Reports are available to ISG Insights™ subscribers or for immediate, one-time purchase on these webpages: global report and U.S. report.

About ISG Provider Lens™ Quadrant 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 serving the U.S., Germany, Australia, Brazil and the UK, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

The series is a complement to the ISG Provider Lens Archetype reports, which offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types. An ISG Provider Lens Archetype report on Next-Gen ADM services will be published next month.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 700 clients, including 75 of the top 100 enterprises in the world, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; technology strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,300 professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry's most comprehensive marketplace data. For more information, visit www.isg-one.com.

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SOURCE Information Services Group, Inc.