Asia Pacific Firms Focus on AI for Application Modernization

The research describes growing demand for local service delivery in Southeast Asia, Australia and New Zealand.

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Service providers integrate rapidly advancing tools to support governed, region-wide application transformation, ISG Provider Lens^® report says

SYDNEY--(BUSINESS WIRE)-- Organizations in Asia Pacific are reshaping application development and maintenance (ADM) with AI, accelerating change while retaining the control necessary for business continuity, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm.

The 2026 ISG Provider Lens^® AI-Driven ADM Services report for Asia Pacific finds that enterprises are modernizing complex IT environments that include legacy applications, packaged platforms, cloud-native systems and increasingly AI-enabled business workflows. To support these transformations, they seek providers that can improve reuse, speed and reliability in software delivery rather than simply contributing engineering capacity.

“Organizations in Asia Pacific need application change that is faster, more reliable and fully accountable,” said Michael Gale, partner and regional leader, ISG Asia Pacific. “They are embedding AI throughout software lifecycles while maintaining clear oversight of security, traceability and quality.”

India remains a major engineering and delivery hub in the region, but enterprises increasingly seek ADM services within local contexts rather than relying solely offshore outsourcing. In Southeast Asia, Australia and New Zealand, demand is growing for local engagement, regulatory familiarity, business proximity and industry-specific delivery.

Organizations are embedding AI throughout ADM practices, including requirements analysis, code generation, documentation, testing, remediation and release readiness. They are making application operations more proactive through observability, AI for IT operations (AIOps), knowledge automation and self-healing concepts. Enterprises increasingly use continuous testing and AI-enabled test generation to bolster release confidence as delivery accelerates. To validate software across CI/CD processes, APIs, packaged applications and cloud platforms, companies are adopting predictive quality analytics.

Many organizations in the region face technical debt, legacy dependencies, ERP integrations and hybrid infrastructure as they navigate the evolution of applications. To prepare, they assess portfolios and sequence modernization waves before moving selected workloads toward cloud-native architectures. This approach protects business-critical systems while applications and operating models change. These considerations are most critical for industries such as financial services, manufacturing, communications, infrastructure, mobility and asset-intensive sectors, ISG says.

“Application modernization, maintenance and assurance must work as an integrated lifecycle,” said Maharshi Pandya, ISG senior lead analyst and lead author of the report. “Enterprises are seeking providers that use operational insight to shape application improvement and help manage risk across complex estates.”

The report also explores other ADM trends in Asia Pacific, including the convergence of application development, maintenance and quality assurance and an increasing focus on measurable outcomes from AI-enabled services.

For more insights into the ADM challenges faced by enterprises in Asia Pacific, along with ISG’s advice for addressing them, see the ISG Provider Lens Focal Points briefing here.

The report evaluates 38 providers across three quadrants: Application Development Outsourcing, Application Managed Services and Application Quality Assurance.

It names Accenture, Capgemini, Cognizant, DXC Technology, HCLTech, IBM, Infosys, TCS, Tech Mahindra and Wipro as Leaders in all three quadrants. LTM is named as a Leader in two quadrants and Hitachi Digital Services and Planit are named as Leaders in one quadrant each.

In addition, NTT DATA is named as a Rising Star — a company with a “promising portfolio” and “high future potential” by ISG’s definition — in two quadrants. LTM is named as a Rising Star in one quadrant.

Customized versions of the report are available from Capgemini and Planit.

In the area of customer experience, Altimetrik is named the global ISG CX Star Performer for 2026 among AI-driven ADM service providers. Altimetrik earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.

The 2026 ISG Provider Lens AI-Driven ADM Services report for Asia Pacific is available to subscribers or for one-time purchase on this webpage.

About ISG

ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its 1,500 professionals worldwide working together to help clients maximize the value of their technology investments.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260923070921/en/

Press Contacts:

Laura Hupprich, ISG
+1 203-517-3132
laura.hupprich@isg-one.com

Erik Arvidson, Matter Communications for ISG
+1 978-518-4542
isg@matternow.com

Source: Information Services Group, Inc.

Key Terms

aiops technical

AIOps (Artificial Intelligence for IT Operations) uses machine learning and data analysis to monitor, detect, and resolve problems in an organization’s technology systems automatically. It matters to investors because it can cut downtime and operating costs, speed up fixes, and make digital products more reliable—similar to an autopilot that notices and corrects issues before they disrupt service, which can protect revenue and reduce operational risk.

ci/cd technical

CI/CD stands for Continuous Integration and Continuous Delivery (or Deployment), a set of practices and tools that automate the building, testing and releasing of software so code changes reach users quickly and reliably. Think of it as an assembly line that checks each new part before it leaves the factory. For investors, CI/CD lowers the risk of costly bugs, speeds product improvements, reduces development costs, and makes a company’s road map and revenue more predictable.

erp technical

ERP, or Enterprise Resource Planning, is a comprehensive software system that helps organizations manage and integrate core business processes such as finance, supply chain, and human resources in one unified platform. For investors, ERP systems can indicate how efficiently a company operates; strong and well-integrated systems often suggest good management and potential for sustainable growth.