Enterprises Looking to AI for Smarter IT Management

AI-powered software platforms and tools allow organizations to optimize IT performance and drive innovation, new ISG research says

Enterprises are turning to AI-powered software platforms to make IT management more intelligent and ensure their systems and technology meet business needs for efficiency, lowers costs and innovation, according to new research from global AI-centered technology research and advisory firm Information Services Group (ISG) (Nasdaq: III).

The ISG Buyers Guides™ for IT Management, produced by ISG Software Research, find AI plays a growing role in comprehensive software frameworks for IT observability, operations management and FinOps. The need for IT management software is growing, the research says, as enterprises transition to more agile and cloud-centric architectures. AI-powered software is also helping enterprises manage and optimize the delivery, performance and responsiveness of IT services.

“IT leaders need effective operations and service management more than ever for resilience and long-term success,” said Jeff Orr, research director for IT, ISG Software Research. “Enterprises are adopting multiple tools and platforms to support ongoing IT innovation while controlling costs.”

Economic pressures, heightened cybersecurity risks and the growing need to support hybrid and remote workers have intensified the need for software that helps manage and operate IT systems and services. CIOs and IT leaders often cite these trends when building a business case for new investments in this area, ISG says.

Enterprises are strategically integrating AIOps, which uses machine learning to automate IT processes, and holistic observability practices, which help companies understand the state of IT systems through their outputs, the reports say. Together, these approaches enable real-time monitoring of application performance and infrastructure health, and provide the ability to predict and mitigate potential issues, allowing companies deliver high-quality IT services with less manual intervention. Through 2026, ISG expects 40 percent of enterprises to fund AIOps strategies to streamline operations and optimize resources.

AI is enabling IT teams to generate insights from vast amounts of data, the reports say. By 2027, ISG expects software providers to release GenAI-driven tools for processes such as incident management, resource allocation and performance forecasting. GenAI is also changing IT service management, introducing features such as automatic command-line generation to help teams handle service requests.

In the future, agentic AI will enable intelligent workflows with semi-autonomous actions and decisions to manage incidents in real time, ISG says. Self-healing mechanisms driven by agentic AI may be able to resolve issues automatically, allowing IT teams to focus on strategic initiatives. However, the reports say, enterprises need to be aware of unique challenges involving governance, compliance, business risk and other aspects of these emerging technologies.

As companies move more data and workloads to the cloud, FinOps is becoming a critical tool for managing costs and finances. FinOps strategies foster collaboration among finance, IT and business teams to share responsibility for managing costs and resource consumption. ISG expects one in five enterprises to invest in coordinated FinOps efforts by IT and finance departments through 2026.

“CIO and IT leaders are looking to unify the management of their IT environments and technology services through software made more intelligent with AI,” said Mark Smith, chief software analyst and partner, ISG Software Research. “For the first time, our portfolio of IT management software research introduces a unified framework for evaluating software providers and products operating in this space.”

For its 2025 ISG Buyers Guides™ for IT Management, ISG evaluated software providers across five platform categories — IT Operations Management, IT Observability, AIOps, FinOps and IT Service Management (ITSM) — and produced a separate Buyers Guide for each. A total of 43 providers were assessed: Aisera, Apptio, Atera, Atlassian, BMC, Broadcom, Chronosphere, Coralogix, Datadog, Dell Technologies, Digitate, Dynatrace, EasyVista, Elastic, Freshworks, Flexera, Google Cloud, Grafana Labs, Harness, HCLSoftware, IBM, IFS, Ivanti, LogicMonitor, Logz.io, Matrix42 AG, Microsoft, Nutanix, New Relic, OpenText, OpsRamp, Oracle, PagerDuty, ScienceLogic, ServiceNow, SolarWinds, SoundHound AI, Splunk, Sumo Logic, SymphonyAI, Vitria, Zenoss and Zoho ManageEngine.

ISG Software Research rates software providers on seven evaluation categories. Five measure product experience: usability, manageability, reliability, capability, and adaptability. Two are customer experience-related: validation and total cost of ownership and return on investment (TCO/ROI). Providers ranked in the top three for each evaluation category are named as Leaders. Within each platform category, those with the most Leader rankings are named as Overall Leaders.

The Overall Leaders of the 2025 ISG Buyers Guides™ for IT Management were:

IT Operations Management: Splunk earned the highest overall rating, followed closely by Dynatrace, with BMC in third place. Splunk was designated a Leader in six evaluation categories, Dynatrace in three and BMC in four. In addition to these providers, Datadog was also rated Exemplary. LogicMonitor and NewRelic were rated Innovative.

AIOps: Dynatrace earned the highest overall rating in this category, followed by SoundHound AI and Splunk. While Dynatrace and SoundHound AI were designated Leaders in only one evaluation category each, Splunk was a Leader in five evaluation categories. BMC, Datadog, IBM and PagerDuty were rated as Exemplary, and LogicMonitor, New Relic and SolarWinds were rated as Innovative.

FinOps: Datadog earned the highest overall rating, followed by Flexera and Broadcom. Both Datadog and Broadcom were designated Leaders in four evaluation categories each, while Flexera was a Leader in three. Microsoft and Nutanix were rated as Exemplary, while Datadog, Flexera and Zoho were rated as Innovative.

IT Observability: ServiceNow earned the highest overall rating and was designated a Leader in all seven evaluation categories. Splunk and Microsoft came in second and third, respectively. Splunk was designated a Leader in six evaluation categories and Microsoft in one. BMC, Datadog, Dynatrace, Grafana Labs and IBM were rated Exemplary. Coralogix, LogicMonitor and New Relic were rated Innovative.

IT Service Management: ServiceNow earned the highest overall rating, followed by BMC, with Broadcom and Atlassian tied for third place. ServiceNow was designated a Leader in all seven evaluation categories, BMC in five, Atlassian in four and Broadcom in one. Ivanti and Zendesk were rated as Exemplary, and Freshworks and SolarWinds were rated as Innovative.

The ISG Buyers Guides™ for IT Management are the distillation of more than a year of market and product research efforts. The research is not sponsored nor influenced by software providers and is conducted solely to help enterprises optimize their business and IT software investments.

Visit this webpage to learn more about the ISG Buyers Guides™ for IT Management and read executive summaries of each of the five reports. The complete reports, including provider rankings across seven product and customer experience dimensions and detailed research findings on each provider, are available by contacting ISG Software Research.

About ISG Software Research

ISG Software Research provides authoritative coverage and analysis of the business and IT software industry. It distributes research and insights daily through its user community, and provides a portfolio of consulting, advisory, research and education services for enterprises, software and service providers, and investment firms. Its ISG Buyers Guides™ help enterprises evaluate and select software providers through tailored assessments powered by ISG’s proprietary methodology. Visit research.isg-one.com for more information and to sign up for free community membership.

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, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.

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IT leaders need effective operations and service management more than ever for resilience and long-term success. Enterprises are adopting multiple tools and platforms to support ongoing IT while controlling costs.