Key Findings & Highlights:

NelsonHall’s market analysis of Agile, DevOps and Automated Development Services consists of 52 pages (plus detailed appendices).

NelsonHall sees ~34% of application services revenues associated with the use of agile development and DevOps today. While these services are growing rapidly, the large installed base for traditional application development and maintenance means, agile and DevOps will remain a fast growing minority for the next few years.

Agile and DevOps services engagements typically take three forms: vendors delivering development services using agile and DevOps, vendors providing consulting to enable clients to deliver agile development and DevOps internally and engagements that combine both transforming client operations and delivering development services using agile and DevOps.

The vast majority of vendor revenues for agile development and DevOps services are related to the use of these capabilities in the delivery of application implementation and management. However, a small portion (<10%) will be derived from stand-alone consulting services to aid clients in the adoption of these capabilities internally.

Clients that have engaged vendors in completed agile and DevOps service projects are primarily focused on time to market, value, and leveraging vendors to improve their own capabilities. These are all highly important to more than 85% of clients. However, the effectiveness with which vendors are helping realizing this value lags considerably with fewer than 65% of clients viewing vendors as highly effective.

Clients are placing significant importance on vendors’ onshore delivery and automated development tools, each highly important to more than three in four clients. However, vendors are currently significantly less effective in meeting client expectations, with fewer than 60% of clients satisfied with current vendor delivery in any delivery capability.

 To deliver these services, IT service vendors are investing heavily in their agile, DevOps and automated development capabilities. These investments are frequently focused in three main areas:

• Expanding agile and DevOps skilled employee base
• Adding intelligence into toolsets used to deliver services
• Transforming the spaces used to deliver these services.