Enterprises adopt AI-enhanced methods that align innovation and compliance, ISG Provider Lens report says
European companies adapting mainframe systems are moving from experimental to operational use of generative AI (GenAI) within standardized workflows, integrating it in key stages of modernization, 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 Mainframes Services and Solutions report for Europe finds that enterprises are deploying AI-driven workflows built on deterministic engines to coordinate multiple tasks, including analysis, rule explanation, test creation and scaffolding. GenAI enhances existing modernization tools by speeding up analysis and planning while maintaining accuracy through verification.
"Enterprises increasingly expect explainable, production-grade and well-controlled AI within mainframe modernization processes," said Matthias Paletta, director and ISG technology modernization solution lead for EMEA. "Providers that demonstrate repeatable, auditable GenAI capabilities are gaining credibility as organizations prioritize AI governance and integration."
Mainframe modernization in Europe has entered a phase in which data sovereignty and regulatory demands are directly shaping how organizations carry out modernization. Enterprises demand clear, evidence-based assurances on where data is stored, how workloads are run and who can access and control encryption keys. They increasingly expect AI platforms and tools to operate in secure, isolated environments.
European organizations are moving away from large, one-time mainframe replacements toward gradual, carefully managed modernization programs to reduce risk, maintain compliance and accommodate limited skills and capacity. Providers are adopting a two-track approach that separates deterministic modernization, such as optimization and refactoring, from targeted transformation initiatives. This enables enterprises to modernize their mainframe environments incrementally while keeping core systems stable and avoiding disruptions caused by the scarcity of specialist skills.
While increasingly using GenAI in mainframe modernization, European enterprises are still taking a cautious approach, especially in critical systems. Rather than relying on fully automated AI-led changes, they are incorporating human review at key stages, along with clear records of decisions and thorough testing. This approach helps reduce risks and maintain accuracy. As a result, GenAI is increasingly used to support engineers and speed up work, while final decisions and accountability remain firmly with human teams.
"European enterprises are reshaping mainframe modernization around governance, stability and accountability," said Oliver Nickels, lead author of the report. "Success depends on disciplined, risk-managed execution and transparent operations rather than rapid, large-scale change."
The report also explores other mainframe technology trends affecting European enterprises, including reliance on hyperscalers to adapt to regional regulations and enterprises' growing need for end-to-end alignment across consulting, modernization and managed operations.
For more insights into the mainframe-related challenges that enterprises face in Europe, and ISG's advice for addressing them, see the ISG Provider Lens Focal Points briefing here.
The report evaluates the capabilities of 30 providers across three quadrants: Mainframe Technology Consulting, Mainframe as a Service and Application Modernization Services.
It names Atos, DXC Technology, HCLTech, Kyndryl, TCS and Wipro as Leaders in three quadrants each. Capgemini and Infosys are named as Leaders in two quadrants each. Accenture, Cognizant, LTM and Tech Mahindra are named as Leaders in one quadrant each.
In addition, Tech Mahindra is recognized as a Rising Star a company with a "promising portfolio" and "high future potential" by ISG's definition in two quadrants. Additionally, Fujitsu is recognized as a Rising Star in one quadrant.
In the area of customer experience, mLogica is named the global ISG CX Star Performer for 2026 among mainframe service and solution providers. The provider 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.
A customized version of the report is available from DXC Technology.
The 2026 ISG Provider Lens Mainframes Services and Solutions report for Europe 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.
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Press Contacts:
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Philipp Jaensch, ISG
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