Industries

Energy & Utilities

Optimize your strategic direction and digital projects for defensibility in a transparent industry.

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Top Story

The Future of Utilities: A Year of Transformation

For utilities, the landscape of 2025 is characterized by profound evolution and innovation.

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Industry-specific Understanding & Best-in-Market Solutions

ISG has the industry knowledge and experience to advise utilities on cloud and agile digital projects, divestitures, mergers and acquisitions and more.

ISG can help you:

  • Rapidly reduce O&M costs in response to intense budgeting pressures
  • Re-imagine IT operating models to increase agility in the digital age
  • Find the right SI partner to manage new capital project implementations
  • Reconcile incompatible IT landscapes and service delivery models post-acquisition / divestiture
  • Design and source utility-specific vendor management solutions
  • Guarantee regulatory-grade benchmarks and provide expert testimony when required

Go digital with us:

  • Manage the risks of building new digital platforms
  • Increase agility and improve IT value during service agreements’ renewal periods and beyond
  • Ensure industry-leading digital experiences from your providers
  • Control the costs and risks of moving to cloud-based solutions

Ensure Regulatory-Grade Benchmarks

Many regulators put the onus on you to demonstrate that your costs are reasonable with outside benchmarks. When it comes to providing testimony as an expert witness for utilities, our competitors’ survey approach to data and benchmarking is not sufficiently dependable on the stand. At ISG, we do not collect benchmarking data through broad-based surveys, and we do not purchase data for benchmarking purposes. Instead, we provide:

  • Data from over 6,000 unique benchmarking assignments and from ISG’s proprietary database, including operational and financial data, key performance indicators (KPIs) and other performance measures
  • Benchmarks according to size, project scope and support function which use robust, repeatable methodologies and built-in data integrity and validation

Get visibility into the root causes of your gaps in performance and actionable recommendations to achieve the “right cost to serve.” Along with these key insights, ISG is experienced at testifying to our benchmarking methodologies and resulting studies in regulatory proceedings around the world.

Provider Research

ISG's full research report on the Utilities industry is a+60 pages, thorough comparison of needs, trends and providers in the industry. To access the full report and a complimentary briefing on it, contact us!

Focal Points Power and Utilities 2024

The market has moved from ambition to accountability.

AI investment is accelerating, but results remain uneven. Only one in four initiatives is meeting revenue impact expectations, at an average spend of $1.3M per use case. Enterprises are no longer asking whether AI works. They are being asked to prove that it pays.

What We Deliver

AI strategy, governance and intelligence, built for execution.

Autonomous Enterprise

Operations built for autonomous execution, not retrofitted for it.

We help you identify where AI agents deliver the most value, restructure workflows around them and build the accountability models that keep autonomous execution auditable. The enterprises that win won't be the ones that reacted. They'll be the ones that designed for it first.

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Autonomy-Level Pricing

Pricing that reflects how AI-enabled services are actually delivered.

We give enterprises transparent, benchmarkable pricing models that tag each resource unit with the autonomy level used to deliver it. As AI capability advances, your pricing keeps pace. Both buyers and providers can quantify what that progress is worth.

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AI & Software Intelligence

Build-versus-buy decisions grounded in what AI is actually delivering.

We bring analysis of more than $2.6 billion in tracked AI spend to every sourcing decision. Procurement, technology and finance leaders get the independent intelligence to rationalize vendor portfolios and hold providers accountable to measurable outcomes.

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AI Governance

Governance that accelerates AI adoption rather than constraining it.

We embed controls at the point of data creation, define accountability for autonomous actions and build adaptive frameworks that keep pace with AI without impeding it. Enterprises that get this right don't just manage risk. They build the trust that lets them scale faster.

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AI Strategy

AI investment aligned to where impact is most achievable.

We ground strategy in research across 2,400 enterprise use cases, aligning investment to where impact is proven and designing the data, talent and governance foundations that move AI from pilots into the workflows that drive commercial results.

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AI Maturity Index

A clear view of where you stand and a roadmap to where AI starts delivering.

We benchmark your AI readiness against peers across 75 countries, identify the dimensions holding you back and give you a personalized roadmap to close the gap.

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The market today

Enterprise AI has moved out of IT and into the revenue line.

AI investment is shifting decisively toward revenue-generating functions. CRM automation, sales enablement and forecasting have replaced chatbots and IT productivity tools as the leading use case priorities, reflecting enterprise recognition that productivity gains alone do not satisfy board-level scrutiny. At the same time, use cases in production have doubled since 2024, and the portfolio is diversifying rapidly, with over 300 distinct function and industry-specific use cases now in active deployment.

ISG research across 2,400 enterprise use cases shows that the strongest AI returns are currently concentrated in compliance, risk management and quality control, not in the growth and cost outcomes most enterprises originally set out to achieve

The gap between where enterprises are investing and where AI is actually delivering is the defining commercial tension of 2025. Organizations that close it by targeting functions with structured, revenue-attributable data and clear ROI measures will establish performance benchmarks that compress the window for competitors still cycling through pilots. The standard is being set now.

Where enterprises are feeling the pressure
  • Business outcomes are lagging AI ambition
    Enterprises are scaling Al faster than they are realizing value from it. The number of use cases in production doubled between 2024 and 2025, yet only one in four initiatives is meeting revenue impact expectations, and broad cost savings remain elusive. At an average spend of $1.3M per use case, the ROI gap is sharpening board-level scrutiny and forcing a harder question: are we building Al for impact, or for activity?
  • Data infrastructure exposing deferred investment
    Al does fail in isolation. It fails on the foundations beneath it. Most enterprises are running modern Al on architectures built for reporting and compliance. Generative and agentic Al demand real-time contextually rich, governed data at the point of use. Without it, pilots stall and value dissipate before it reaches the business.
  • The barrier to scale is organizational, not technical
    Organizational readiness as the bigger constraint on Al adoption, not talent or tooling. Workflows haven't been redesigned. Decision rights haven't shifted. Enterprises that treat Al as a pure technology deployment, without investing in the human side of adoption, consistently report underwhelming ROI.
  • Agentic AI is outpacing governance
    As Al moves from generating outputs to executing tasks autonomously, the governance gap widens. Agentic Systems introduce a new class of risk that static compliance frameworks were never designed to catch. Governing what Al does, not just what it produces, is now a business-critical requirement.

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