U.S. Enterprises Accelerate Digital Engineering with AI – ISG – May 06, 2026.

Enterprises in the U.S. are strengthening digital engineering capabilities by embedding AI across business functions to make their operations more predictable, according to a new research report published today by Information Services Group (ISG), a global AI-centered technology research and advisory firm.

The 2026 ISG Provider Lens Digital Engineering Services (Large) report for the U.S. finds that organizations are shifting from siloed development to integrated engineering models that support enterprise-wide transformation. The report evaluates large service providers with annual revenue over $2 billion, and a later report will cover midsize providers. Companies are increasing investments in AI-enabled platforms and in services from large providers to achieve measurable business outcomes. The rapid evolution of large language models (LLMs) is changing business models and giving enterprises the confidence and capital to pursue broad AI and machine learning initiatives.

Shafqat Azim, partner, ISG

“U.S. enterprises are redefining engineering as a strategic activity that extends across their value chains,” said Shafqat Azim, partner, ISG. “They are aligning AI with core operations to achieve greater efficiency, adaptability and long-term resilience.”

As companies in the U.S. integrate AI into digital engineering, they gain the ability to take more holistic approaches that produce benefits throughout the organization, the report says. Enterprises are adopting intelligent platforms that connect data, applications and processes, enabling continuous insights and automated responses. This strategy lets businesses move from isolated automation to enterprise-wide optimization. Engineering is evolving from a static build process into a fluid system, central to business performance and innovation, in which infrastructure and applications evolve autonomously in response to enterprise needs.

Companies are modernizing legacy environments by adopting composable, cloud-native architectures that improve scalability and enable faster deployment cycles, ISG says. The adoption of agentic AI is increasing, with autonomous systems executing multi-step processes as part of digital-human hybrid workforces. These changes help organizations reduce complexity while improving responsiveness and system efficiency.

U.S. enterprises are standardizing AI-augmented development processes to automate repetitive tasks such as testing, documentation and basic code refactoring, reducing manual effort and shortening timelines. Beyond this initial focus on efficiency, AI-enabled development is evolving toward deeper use cases that directly influence core business metrics.

“Enterprises are looking beyond early efficiency gains to focus on measurable business impact,” said Shirish Kulkarni, lead author of the report. “Large service providers support this shift by enabling scalable architectures and helping organizations operationalize advanced AI capabilities.”

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