Executive Summary: ISG Provider Lens™ Future of Work Solutions - Global 2025

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ISG Provider Lens™ Future of Work Solutions - AI-enabled Digital Workplace Solutions - Global 2025

ISG Provider Lens™ Future of Work Solutions - Digital Employee Experience (DEX) Solutions - Global 2025

AI, automation and experience-centric platforms reshape digital workplace ecosystems

Overall market conditions, trends and changes since FY24

The digital workplace software market has undergone a significant transformation since FY24, driven by the convergence of hybrid work models, AI innovation and heightened expectations for EX. The post-pandemic normalization of remote and hybrid work has solidified the need for robust digital workplace infrastructures that support productivity, collaboration and security across distributed environments.

In FY25, enterprise IT leaders are prioritizing autonomous IT operations, real-time observability and employee-centric design. ISG’s market FY25 road map highlights a shift toward balancing speed and risk in deploying digital workplace technologies, with an emphasis on tools that enhance UX and productivity. Endpoint security, EX and endpoint management are increasingly integrated, reflecting a holistic approach to digital infrastructure.

The market is also seeing the rise of services as a software (SaaS 2.0), where AI agents support and execute tasks autonomously. This evolution is redefining traditional SaaS models and introducing agentic software services that combine management and optimization.

Key market conditions, trends and changes regarding DEX software and solutions

The digital employee experience (DEX) segment has matured rapidly. According to Business Research Insights, the DEX software market grew from $0.97 billion in FY24 to $1.15 billion in FY25, with projections reaching $4.25 billion by 2033. This growth is fueled by enterprise demand for proactive IT management, sentiment analytics and sustainability-focused device lifecycle planning.

ISG’s FY25 global solutions study and analysis reveal a strategic pivot from basic telemetry to AI-driven autonomous experience management. Vendors such as Nexthink, Lakeside Software and Riverbed have expanded their platforms with predictive analytics, generative AI (GenAI) assistants and mobile observability tools. Tanium’s emergence as a Leader underscores the growing importance of real-time sentiment tracking and self-healing capabilities.

ISGs’ market analysis highlights the integration of disparate tools into unified platforms, enabling enterprises to illuminate blind spots, drive adoption and measure experience-level agreements (XLAs). M&A activity, such as 1E’s acquisition of Exoprise and Riverbed’s launch of Aternity Mobile, reflects a strategic push to serve frontline and mobile workers effectively.

Key market conditions, trends and changes regarding AI-enabled digital workplace solutions

AI has become the cornerstone of digital workplace innovation. In FY25, nearly all enterprises are investing in AI, yet only 1 percent consider themselves mature in deployment. The focus has shifted from experimentation to integration, with AI embedded across workflows to enhance productivity, automate support and deliver contextual insights.

ISG’s analysis of market intelligence estimates AI could unlock over $4 trillion in productivity gains, but short-term returns remain elusive. Organizations are grappling with shadow AI, the unsanctioned use of AI tools by employees, which introduces risks around data security and compliance. As a result, governance frameworks and responsible AI training are becoming essential.

AI-enabled platforms now offer self-healing systems, virtual assistants and predictive diagnostics. Microsoft’s Copilot, Nexthink Assist and Lakeside Software’s GenAI integrations exemplify this trend. Atlassian’s FY25 Developer Experience Report shows developers saving over 10 hours weekly using AI, though organizational inefficiencies still offset these gains.

The convergence of AI with collaborative work management also reshapes project execution. Vendors such as Asana, Monday.com and Smartsheet are embedding AI to automate workflows, generate insights and enhance team productivity. Notion’s AI-driven content creation and Zoho’s Zia assistant demonstrate how AI is democratizing access to intelligent tools across enterprise functions.

Marketplace conditions evolving over the next 12 to 18 months

Over the next 12 to 18 months, the digital workplace market will continue to consolidate around platforms offering unified experience management, AI orchestration and scalable automation. Vendors will differentiate through innovation velocity, global reach and vertical-specific strategies.

By FY26, we expect that:

• AI maturity will accelerate, with enterprises moving from pilot projects to full-scale deployments along with deeper integration of AI into ITSM, unified endpoint management (UEM) and collaboration platforms.

• Outcome-based pricing models will gain traction, especially for AI agents and automation tools.

• Systems integrators (SIs) will play a pivotal role in bridging the gaps between legacy systems and modern digital workplace solutions. Their ability to customize, integrate and optimize AI-enabled platforms will be critical to enterprise success.

• Security and compliance will remain top priorities, especially as AI tools handle sensitive data and automate decision-making.

• Sustainability and green IT initiatives will influence device lifecycle management and software procurement decisions.

Implications for developers, vendors and buyers

For developers and vendors:

• Platform unification is essential. Vendors must consolidate disparate tools into cohesive ecosystems that support observability, automation and collaboration.

• AI capabilities must be explainable and secure, with clear governance and user training to ensure responsible use.

• Vertical-specific solutions will gain favor, especially in healthcare, finance and manufacturing, where compliance and customization are critical.

• Partner ecosystems will expand, with vendors collaborating with managed service providers (MSPs), SIs and cloud providers to scale reach and functionality.

For buyers:

• Vendor selection will prioritize integration, automation and AI maturity. Buyers will seek platforms that reduce IT friction, enhance EX and deliver measurable ROI.

• Proof of value will be key. Enterprises will demand reference cases, outcome metrics and transparent pricing models.

• Hybrid work support remains non-negotiable. Solutions must offer seamless experiences across devices, locations and roles.

Role of SIs and service providers

SIs and traditional IT services providers are uniquely positioned to capitalize on the evolving digital workplace landscape. As enterprises seek tailored solutions, these providers can:

• Bundle AI-enabled platforms with their own services, offering end-to-end digital transformation packages.

• Provide integration expertise, connecting legacy systems with modern tools to ensure seamless workflows.

• Deliver managed services, including observability, automation and compliance monitoring, using DEX and AI platforms.

• Act as strategic advisors, guiding clients through AI adoption, governance and optimization.

The value of digital workplace solutions to SIs and service providers lies in their ability to differentiate offerings, accelerate time to value and drive recurring revenue through managed services and platform reselling.

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