System Integration Market - Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2031 - By Product, Technology, Grade, Application, End-user, Region: (North America, Europe, Asia Pacific, Latin America and Middle East and Africa)

System Integration Market - Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2031 - By Product, Technology, Grade, Application, End-user, Region: (North America, Europe, Asia Pacific, Latin America and Middle East and Africa)

Digitalization and centralization of enterprise processes have influenced many companies to turn to financial and distributed information technologies. As the world embarks on the innovative journey of digital transformation, disruptive forces are becoming significantly prevalent across almost every industry. Consequently, various companies are looking for ways to integrate their critical services and processes into the same stack.

System integration allows enterprises to arrange a broad array of software and hardware components into a consolidated ecosystem. The approach as a whole is becoming more valuable than ever before. The expansion of the system integration market size globally is projected to grow substantially in the coming years.

System Integration Market Trends

Cloud Computing to Remain Cost-effective

Modernization of companies’ IT infrastructure is not completed with the acquisition of new technologies. To boost modernization, market players must help customers shift specific workflows and use cases to the cloud, such as procurement, enterprise resource planning (ERP), payroll, and supply chain management solutions. Cloud-based models are used as vital agents for business transformations and are the apparent deployment model of choice for modernizing existing IT infrastructure. Investments in cloud computing have risen moderately, offering economies of scale while providing security to the confidential data of companies in sync.

Growing Adoption of NGOSS

Conventional business support systems and operations face difficulties associated with security issues, long process cycles, and low data accuracy. Service providers in the system integration market are deploying New-Gen Operations Systems and Software (NGOSS) to address these challenges. Telecom operators are strategically incorporating NGOSS to facilitate integration with innovative Internet Protocol (IP) based frameworks, potential use cases, and enhance customer service and support. NGOSS enables mobile network operators (MNOs) to unveil and rationalize their enterprise processes, particularly from service quality and resource performance viewpoints. Furthermore, they help MNOs handle operations swiftly and enable these processes to grow independently.

Europe and Asia Pacific Market Dynamics

Europe remains one of the largest markets for vendors with the highest system integration market share. The European Union (EU) has rolled out innovative strategies for energy system integration, devised to be major investment cornerstones of the Green Deal and the post-COVID-19 rebound in Europe. Additionally, the EU is investing in new technology and trial projects to establish 5G ecosystems in Europe. These projects focus on creating a top-notch European supply chain for 5G hardware and serving use cases in trans-border automated and connected mobility.

The system integration market in Asia Pacific (APAC) is experiencing a robust compound annual growth rate (CAGR) and is expected to surpass Europe’s market in the coming years. Supportive government initiatives such as financial aid and subsidies have benefited SMEs in the region. For instance, the Make in India initiative emphasizes offering subsidies to SMEs. Adoption of system integration services in the industrial automation domain in India will remain healthy despite COVID-19 repercussions. China has launched a plan to offer internet connectivity to rural and underserved areas. Additionally, the availability of cost-effective labor and raw materials is influencing international players to outsource their activities to players operating in APAC.

Latin America Market Growth

The deployment of system integration services in Latin America is accelerating at a double-figure CAGR. The region is confronting increasing energy demands and has recognized in-depth assessment of energy supply and demand scenarios as a priority. The International Atomic Energy Agency (IAEA) has introduced a regional technical cooperation project to validate the benefits of sub-regional energy integration, such as greater energy security, reduced expenses, and stricter environmental controls. Furthermore, Mexico majorly represents the system integration market in Latin America.

Infrastructure System Integration Services

Infrastructure system integration services continue to lead the global system integration market in terms of revenue share and CAGR over the forecast period, given the mass utilization of cloud-based and network management services. Infrastructure system integration serves various end users by leveraging single hardware, making it a cost-efficient option for organizations with limited capital resources to invest in hardware. Building management system integration captures a prominent value share as they are key components in organizations regardless of the sector. System integration services analyze entire mechanical and electrical equipment such as ventilation, elevators, and lighting. Looking ahead, application integration and configuration services will also see significant adoption due to the rising number of cloud-based and mobile applications.

Large Enterprises and SMEs

Large enterprises account for a significant proportion of system integration service installations, and this trend is expected to grow at a tremendous CAGR. The onset of cloud-based models as a cost-effective option has triggered the adoption of system integration services among small- and medium-sized enterprises (SME). Cloud-based models help save considerable costs and eliminate the need for physical hardware investments. Service providers are integrating the cloud with system integration to reach a larger customer base. Deployment of system integration services in SMEs will register double-digit year-on-year (Y-o-Y) growth during the latter half of the forecast period, which bodes well for the growth of the system integration market.

IT & Telecom Industry

The IT and telecom industry holds a significant sway in the system integration market, attributable to the surging penetration of 4G services and the emergence of 5G infrastructure. This infrastructure contains data-intensive networks and results in the generation of huge chunks of data. Furthermore, the increasing number of telecom subscribers utilizing smartphones and other handheld devices across the world will positively influence the adoption of system integration services in the IT and telecom industry. Demand for system integration services will also remain substantial in the energy and utilities and government and defense industries, with adoption in the former growing at a double-digit CAGR.

System Integration Market: Competitive Analysis

With leading players accounting for a substantial revenue share, the global system integration market is highly consolidated. Players in the system integration market have been focusing on launching innovative solutions and services and investing in strategic mergers and acquisitions (M&A) as end users seek to modernize and digitalize their organizations. For instance:
• Tata Consultancy Services (TCS) has rolled out Business Ecosystem Integration Services (BEIS) to assist enterprises in integrating with larger environments and developing innovative user-centric offerings. BEIS aims to integrate heterogeneous and existing technology stacks within and outside the organization, offering sleek communication and enabling collaborations throughout companies. BEIS features three components: integration services, advisory services, and operational models.
• Capgemini Group has entered into an agreement with LzLabs to support its customers in implementing LzLabs Software Defined Mainframe® (LzSDM®). Capgemini will offer technical system integration services on joint projects with LzLabs to help customers migrate from mainframe to cloud.
• Accenture has acquired PLM Systems, a Turin-based boutique systems integrator, to expand its capabilities in helping customers manage and leverage product data in engineering, design, and manufacturing.

Other key players in the system integration market include IBM Corporation, Cisco Systems Inc., Cognizant, Fujitsu Limited, DXC Technology, HCL Technologies, Wipro Limited, Deloitte, Infosys, and Tech Mahindra Limited.

Impact of COVID-19 Pandemic

Services have been significantly affected by the COVID-19 pandemic, particularly in transport, tourism, and distributional services due to mobility and travel restrictions and other social distancing measures. Disruptions in services are having an economic and trade impact given their role in providing inputs for economic activities, connecting supply chains, and facilitating trade. Despite these challenges, system integration services can be deployed remotely by vendors' administration departments. Slight declines are forecasted in the growth rates of industry verticals such as BFSI and IT and telecom, but these troughs will recover by the end of 2021. Overall, the system integration market growth rate is estimated to continue at a steady pace during the ongoing pandemic.

Analysts’ Viewpoint

With retail businesses harnessing the capabilities offered by online services, the retail industry is unlikely to experience significant losses during the ongoing COVID-19 pandemic. Retailers are procuring system integration services to ensure efficient operations and sales online. Suppliers in the system integration market are enhancing their online businesses, as consumers adopt new habits contributing to the long-term transition toward online services.

Market Segmentation

By Service Type
• Infrastructure System Integration
Building Management System Integration
Security System Integration
Network Integration
Data Center Infrastructure Integration
Cloud Infrastructure Integration
Others
• Software System Integration
Application Integration & Configuration
Data Integration
Technology Integration
Middleware Integration
Others

By Enterprise Size
• Small & Medium Enterprises
• Large Enterprises

By Industry
• BFSI
• Retail & CPG
• IT & Telecom
• Healthcare
• Manufacturing
• Government & Defense
• Energy & Utilities
• Others

By Region
• North America
• Latin America
• Europe
• East Asia
• Southeast Asia Pacific
• Middle East and Africa (MEA)

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