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The Arrival of Digital Engineering: Megatrends Driving Engineering Services

As we look back over the past decade from what is now a networked, intelligent and connected economy, we see engineering as a transformed field. The way businesses design, deliver, consume and partner to source will never be the same. Given these trends, what should organizations do next?

The Top Digital Engineering Agenda Items on a CxO’s Desk


Are you asking the right questions?


    Top Priority

    How do I handle sustainability not as a one-off project but rather as a strategic agenda?

    Key Drivers

    How do I formulate and execute a net-zero strategy? How do I improve performance in the circular economy and also reduce product recalls? How do I improve IT’s contribution to sustainability via Agile, DevSecOps, Digital Twins and optimizing algorithms?

    Make-Buy-Partner Decisions

    Top Priority

    How does my new software driven strategy change my Make-Buy-Partner decisions?

    Key Drivers

    How do I achieve effective partnering with suppliers, strengthening collaboration, and enabling joint innovation? How do I optimize my core engineering spends?

    Industry 4.0

    Top Priority

    How do I balance factory productivity, agility, visibility and new business models with IT-OT integration as the new basis of Industry 4.0?

    Key Drivers

    How do I improve asset utilization and leverage predictive maintenance? How do I modernize legacy Engineering & OT Apps and make them a transformation accelerator?

    Example Technologies
    • IIoT
    • Intelligent Automation / Robotics
    • Big data
    • Edge intelligence
    • Human Machine Interface (HMI)
    • Digital Simulation
    • Product lifecycle management (PLM)
    • Manufacturing operations management (MOM)
    • Industrial cybersecurity
    • 5G
    • Virtual reality and augmented reality (VR/AR)
    • Visual quality inspection

    Software-driven Business and CX

    Top Priority

    How do I enable a software-driven business and an improved customer experience?

    Key Drivers

    How do I unbundle software and hardware to define my new core and new operating model? How do I transition to a platform as a product strategy, for faster time to market / NPI and better customer engagement? How can industrial DevOps enable continuous releases?

    Example Technologies
    • Cloud-native / digital-first design
    • Digital Twin/Model based systems engineering (MBSE)
    • Virtualization, cloudification and edge intelligence
    • Data analytics, AI, ML
    • Rapid prototyping / Additive Manufacturing
    • IIoT
    • Digital Simulation
    • Product Lifecycle Management (PLM)
    • Product and Industrial Cybersecurity

    Connected Enterprise and Digital Twins

    Top Priority

    How do I enable a new connected enterprise and Digital Twin-/Threads, to improve services revenue, supply chain traceability and enhanced product offerings?

    Key Drivers

    How do I scale my IoT initiatives and enable data insights across IT – OT (Operations Technology) – ET (Engineering Technology) domains? How do I elevate my customer delivery experience through an agile, resilient and demand-driven supply chain? How do I optimize my technology backbone across the cloud – edge spectrum?

    Example Technologies
    • IIoT
    • Big data and cloud computing
    • Edge intelligence
    • Digital Simulation
    • Product Lifecycle Management (PLM)
    • Manufacturing Operations Management (MOM)
    • Product and Industrial Cybersecurity
    • 5G
    • Virtual and Augmented Reality (VR/AR)
    • Blockchain

    How can ISG Digital Engineering Advisory help you in your transformation journey?

    ISG partners with our clients to determine a future vision, lead rapid change and realize the value of your digital investments at scale. We help our clients achieve operational excellence and faster growth through our proven methodology.

    Digital Engineering for Enterprises

    Assess & Define

    We help you assess the current state of your transformation initiatives vis-à-vis the target state and derive measurements for closing the gap by leveraging ISG‘s industry data points and best practices. ISG will work with you to identify transformational and operational impact areas.

    Design Target Operating Model (TOM)

    ISG will help you perform a strategic re-design of your TOM, including all relevant technology, organizational and ecosystem aspects.

    Sourcing Strategy

    ISG helps you define a sourcing strategy, including advisory services, data and market alignment on make vs. buy vs. partner decisions and potential sourcing scenarios.

    Operationalize and Govern

    To achieve continuous improvements, we help you onboard a best-in-class ecosystem that supports your target operating model (TOM), offers flexibility and enables agile contracting. ISG works with you to define the right KPIs and governance mechanism to track success.

    Digital Engineering for Service and Technology Ecosystem Providers:

    ISG helps providers create a differentiated positioning in the secured, intelligent, connected economy. We work with you to shape the market.


    ISG assess your existing portfolio and market relevance to identify gaps and opportunities for improvements.


    We help you identify whitespaces and redefine your reference portfolio for chosen industry segments and work toward a targeted traction.

    Go to Market

    ISG's "market making" services help you reshape your go-to-market strategies. This includes:

    • Deal shaping and market shaping support, such as for responding to the market via RFPs
    • Ecosystem partnership recommendations
    • Sales strategy and sales enablement support.

    Contact Us to Get Started

    Featured Insights


    Learn about ISG's expertise in the manufacturing space, including automotive, industrial and aviation. Embrace digital transformation at speed and scale for better resiliency, agility, adaptability and spend/value.


    Energy & Utilities

    Optimize your strategic direction and digital projects for defensibility in a transparent industry. Find out how ISG Digital Engineering solutions can identify and bridge the gaps, enabling your digital transformation goals.


    Life Sciences

    Discover how digital engineering can solve your Life Sciences industry specific challenges. We'll help you navigate regulatory hurdles and cost pressures – plus digitize to focus on patient centricity and medical innovation.


    Optimizing Engineering Services

    Engineering organizations are at a crossroads. New market forces, such as attracting customers by rapidly introducing innovative features, services and experiences, as well as continuously enhancing the product functionality over its lifecycle, pose challenges and at the same time opportunities.

    The playbook for defending software or data enabled companies is still being written as engineering organizations tackle some of these challenges for the first time. Hear ISG expert Vishnu Andhare address the high-impact areas and use cases engineering organizations are addressing to achieve savings of 15-30% and enable new revenue streams. Most importantly, hear how they are reorganizing around a new operating model that will distinguish the winners from the rest.

    Contact Us

    Featured Event

    TechXchange: Smart Manufacturing 2021

    Join us for the ISG TechXchange: Smart Manufacturing to discover the trends that will define the manufacturing industry in the years to come.

    Learn more

    ISG to Publish Study on Digital Engineering Services Providers

    Service providers now have a chance to distinguish their positioning in the market by participating in ISG Provider Lens™ (IPL). Via IPL the enterprises get a practitioner-led service provider comparison, empowered by ISG’s advisory experience and data-driven research.

    Read our press release

    Meet our team