Digital engineering spending to grow 1.7x to over $1 trillion by 2025, says Zinnov | News Bharat

~ In the next three years, Metaverse, 5G, and the digital thread will catalyze the digital transformation of enterprises ~

New York, December 1, 2022 /PRNewswire/ — The need for digital will only increase over the next 3 years, driven by macroeconomic factors such as increased defense spending, increased use of semiconductors and heightened focus on sustainability. ZinovAccording to analysis, digital engineering spending will account for nearly 53% of total global engineering research and development (ER&D) spending by 2025, thanks to the continued pace of innovation across industries. The study titled, The rise of digital engineering continues unabated,,” Is the benchmark for business leaders across industry verticals to identify strong partners for faster and more efficient deployment of ER&D-led service initiatives across geographies. In addition to assessing the global ER&D landscape, the study also estimates the global ER&D spending of organizations in various vertical industries.This expenditure will be 6% CAGR touch $2.03 Tennessee by 2025as businesses double down on digital investments to strengthen their market positions.



North American companies accounted for the largest share of overall ER&D spending at approximately 53%, benefiting from higher software penetration in the region. In fact, Internet companies will account for more than half of global ER&D spending by 2025, the study notes.Asia Pacific continues to grow steadily and is poised to surpass Western Europe in the next 12 months. This growth stems from the presence of high-tech verticals in the region, with companies investing in new-age technologies such as 5G, Metaverse, Digital Thread, and Cloud/AI.

According to Zinnov, while businesses’ digital priorities may change, there are some frontrunners who are catalyzing digital transformation:

Metaverse—— Increased investor interest and investments from large tech companies are accelerating interest in the Metaverse. The technology is rapidly evolving as sales and customer engagement become prominent themes and use cases expand beyond gaming. Metaverse delivers the ability to seamlessly blend the physical and virtual worlds for immersive digital experiences for retail and media use cases.

5G—— With 5G estimated to account for 40 percent of all mobile connections by 2026, enterprises across all industries are exploring a multitude of use cases with diverse and dynamic network requirements. This has led telecom players across the value chain (telecom operators, network equipment providers, semiconductor companies, etc.) to work on developing multiple 5G-enabled features and solutions. Some prominent use cases that present significant opportunities for ER&D service providers include network slicing, edge computing, 5G C-V2X, and disaggregated networking.

Digital Thread – Smart manufacturing is increasingly becoming a bargaining chip, and Digital Thread incorporates “intelligence” in every step from design, manufacturing, supply chain to insight and service. Enterprises are focusing on IT/OT integration through the digital thread by connecting products and creating information flows about product performance and usage from design to production, sales, use and disposal. From smart manufacturing, remote monitoring, and predictive maintenance to digital twins and asset monitoring, enterprises are partnering with an ecosystem of service providers to accelerate their digital thread-led initiatives.

Cloud and AI – By 2024, 90% of organizations will have a hybrid cloud model, driven by factors such as cost efficiency, scalability and agility. Today, 47% of enterprises have a dedicated cloud COE and are partnering with and investing in cloud startups more than ever before. Additionally, service providers are increasingly working with hyperscale partners to provide scalability, enabling faster GTMs for enterprises.As the global artificial intelligence market size touches $127 billion Over the next 3 years, service-led verticals will lead AI investments to drive better customer experiences. AI-driven banking, drug development and autonomous driving are some of the major areas of corporate investment.

Speaking of this study, Sidan RastojiManaging Partner, Zinnov, Said, “Technology is indeed at the core of companies in every vertical, even in traditional businesses such as banks and industrial companies. The past few years have highlighted the importance of businesses moving from physical structures into digital spaces, and have also changed the way they operate digitally. way to provide a seamless customer, employee and partner experience. This has translated into an increase in digital engineering spending, which businesses are using to build new digital products and experiences and digitally support their existing products and Services. Enterprises are breaking down their traditional barriers and driving operational change across technology domains.”

“As businesses embrace the next wave of growth, they are grappling with a widening digital engineering talent gap. The current shortfall of 4.46 million tech professionals will nearly double to 8.04 million by 2026. Businesses are leveraging a three-pronged approach The following approaches to bridge this gap – partnering with service providers to accelerate their product roadmaps by introducing product innovation; leveraging automation to increase efficiency; exploring the gig economy as a talent acquisition strategy. With the development and high focus on technical digital skills such as Metaverse, Cloud/AI, automation, etc., across verticals, service providers will play a more critical role in product development in the future.”

Zinnov’s assessment of ER&D service providers

Zinnov’s assessment of global ER&D service providers this year is unique because it captures SP’s depth of hyperscale partnerships to support consulting, design, build applications and modernization, integration and testing services in the ER&D space.The study covers SP’s electrification capabilities, as well as geographic assessment of high-spending regions such as the U.S. and Europewhere the main parameters analyzed include investment, customer success, and deliverability of engineering services.

For this study, Zinnov evaluated approximately 50 global ER&D service providers in the following areas:


horizontal line

  • digital engineering

  • Digital Engineering – Small to Medium Service Providers

  • Data and AI Engineering

  • Data and Artificial Intelligence Engineering – Small and Medium Service Providers

  • Experience Engineering

  • Experience Engineering – Small and Medium Service Providers

  • Industry 4.0

  • Overall hyperscale service

  • Hyperscale Services – Small to Medium Service Providers

  • Hyperscale Services (AWS) – Top 10 SPs

  • Hyperscaler Services (Microsoft Azure) – Top 10 SPs

  • Hyperscaler Services (Google Cloud) – Top 10 SPs

Vertical field: Automotive, Aerospace, Consumer Software, Enterprise Software, Industrial, Semiconductor, Telecom

Micro vertical: Software Platform Engineering, Telemedicine and Electrification

Evaluated Service Providers: Accenture, Accolite Digital, ACL Digital, AFRY, Akkodis, Apexon, Aspire Systems, AVL, Bertrandt, Brillio, Capgemini, Caresoft Global, Cognizant, Cyient, Daffodil Software, EDAG, eInfochips, Encora, EPAM, Expleo Group, e-Zest , FEV, Global Logic, Globant, GS Lab|GAVS, Happiest Minds, HARMAN DTS, HCLTech, IAV, Ignitarium, Infovision, Innominds, Intellias, Itransition, Kellton, KPIT, L&T Technology Services, Marlabs, Mphasis, Nebula Cloud, Ness Digital Engineering, Persistent Systems, Quest Global, R systems, Sacumen, Sasken, Softdel, Sonata Software, Tata Elxsi, Tata Technologies, TCS, Tech Mahindra, Trigent, UST, Virtusa, VVDN Technologies, Wipro

1Z1000 Represents Top 1000 Global ER&D Spenders Across 20+ Verticals

About Zinnov Zones

Zinnov Zones is an annual rating issued by Zinnov that evaluates global service providers based on their competitiveness, capabilities and market success. Since 2009, Zinnov Zones (formerly known as GSPR – Global Service Provider Rating) has become one of the world’s most trusted reports for businesses and service providers to better understand digital transformation, ER&D services, Internet of Things and more vendor ecosystems, HIAs, and media and entertainment in all areas.

This is the thirteenth year in a row that Zinnov has evaluated service providers’ ER&D capabilities. For detailed ratings and contact information for service providers, please visit:

About Zinov

Founded in 2002, Zinnov is a global management and strategy consulting firm with New YorkSanta Clara, houston, seattle, bangaloreGurgaon, Parisand Pune. Over the past 20 years, Zinnov has successfully advised more than 250 Fortune 500 companies to develop actionable insights that help them accelerate their engineering journeys to create value—across both revenue and optimization dimensions. With core expertise in digital engineering, digital transformation, innovation and outsourcing consulting, Zinnov assists clients by:

  • Increase revenue for company products and services in new markets through customer intelligence, market entry and market expansion consulting;

  • Advising global private equity firms on asset screening and target evaluation, commercial due diligence and value creation;

  • Help global companies outline and drive their open innovation initiatives, design and operate accelerator programs, and collaborate with start-ups on specific use cases and predefined outcomes;

  • Enable global companies to develop and optimize their global engineering footprint through hub settings, technology and functional accelerators for greater R&D efficiency, innovation and productivity;

  • Build and implement digital transformation levers powered by technologies such as AI/ML, cloud, IOT and RPA.

With its team of experienced consultants, subject matter experts and research professionals, Zinnov serves clients from multiple industry verticals including enterprise software, BFSI, healthcare, automotive, retail and telecommunications in the US, Europe, Japanand India.

For more information, visit




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