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TMCNet:  Increase in Technology Convergence to Boost the Global Product Engineering Services Market, Says Technavio

[March 16, 2016]

Increase in Technology Convergence to Boost the Global Product Engineering Services Market, Says Technavio

Technavio analysts expect the global product engineering services market for 2016-2020 to exceed USD 989 billion by 2020, growing at a CAGR of almost 10%, according to their latest report.

Product engineering services are helping client firms to resolve key business challenges through the use of innovative engineering solutions. The implementation of product engineering solutions in industry verticals is helping manufacturers to innovate constantly by shortening production cycles. Further, such solutions help companies to differentiate their products from the competition. Demand for intelligent engineering solutions is rising and market players have responded by stepping up new product development to craft new software solutions.

According to Amit Sharma, lead research analyst at Technavio for IT professional services, "The market is growing at a significant pace because the number of product engineering service contracts and deals may increase in the wake of rising demand for innovative products and services from various industry verticals during the forecast period."

Technavio's lead market research analysts for ICT have identified the following four factors that will drive the global product engineering services market:

  • Need for faster time to market
  • Need to drive innovation and support emerging technologies
  • Increase in technology convergence
  • Cost reduction and efficiency

Need for faster time to market

Time to market is an important benchmark that helps improve business agility. Enterprises can gain significant benefits in terms of pricing and brand name by introducing products faster than competitors. Firms are adopting product engineering solutions to reduce development time and accelerate time to market.

Software product development firms often find it difficult to reduce the time required to develop products in the wake of tighter budget constraints, limited workforce, and compliane issues. In response, vendors are providing product engineering solutions to help independent software vendors and other clients maintain product standards and service quality, while accelerating time to market.

Need to drive innovation and support emerging technologies

Firms are under pressure to innovate product and service offerings, because these factors help them remain competitive in the market. However, innovative products and services should be developed in cost-efficient ways. Technology is the enabler for innovation and many vendors have successfully introduced innovative solutions with the help of various technologies.

Emerging technologies such as cloud, social, mobile, big data analytics, IoT, and virtualization are proliferating across industry verticals. Therefore, superior IT solutions are required to help customers leverage emerging technologies. Product engineering solutions are helping clients to innovate and expand product portfolios at reduced costs.

Increase in technology convergence

Technological convergence in the healthcare, automotive, and manufacturing sectors has followed advances in technology and the various aspects of globalization. Technological convergence is encouraging industries to align business strategies with IT strategies to meet corporate goals.

The demand for integrated IT solutions is increasing in the development of products and services. Organizations are using embedded system software development tools and solutions to develop complex products. "This leads us to infer that demand for embedded systems will significantly rise as technologies converge and new product development gains pace," says Amit.

Cost reduction and efficiency

Cost reduction is one of the major factors powering the adoption of product engineering services and solutions. Product engineering services help clients to develop products at low costs while maintaining optimum levels of quality.

The dynamic business conditions and changing consumer demand patterns are forcing OEMs to implement cost-effective IT solutions to meet customer requirements. Product engineering services help OEMs to reduce material costs and maintain a shorter product development time frame (through reverse engineering and process optimization). Manufacturers can also reduce product development costs through advanced design solutions and assembly processes, especially in the automotive sector.

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About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

If you are interested in more information, please contact our media team at media@technavio.com.

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