State and local governments face the growing challenge of meeting rising citizen expectations while navigating workforce shortages and operational inefficiencies. These pressures are intensified by the need to deliver seamless, citizen-centric services and uphold data privacy across increasingly interconnected digital platforms. To address these demands, governments are accelerating digital transformation efforts by modernizing technology infrastructure, automating core functions, and breaking down silos across agencies and jurisdictions. By streamlining operations, public sector employees are empowered to focus on higher-value tasks directly impacting service quality. At the same time, a heightened focus on data security, equitable access, and sustainable practices is shaping public policy, ensuring that digital innovation improves service delivery and contributes to a fair and resilient future for all citizens.
Both demand-side and supply-side trends are covered in our State and Local Government Digital Services 2025 Market Insights™ and State and Local Government Digital Services 2025 RadarView™, respectively. These reports present a comprehensive study of digital service providers in the state and local government space, including top trends, analyses, and recommendations. They also take a close look at the leaders, innovators, disruptors, and challengers in this market.
We evaluated 27 service providers across three dimensions: practice maturity, partner ecosystem, and investments and innovation. Of the 27 providers, we recognized 16 that brought the most value to the market over the past 12 months.
The reports recognize service providers across four categories:
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- Leaders: Accenture, Capgemini, Cognizant, IBM, and Infosys
- Innovators: CGI, NTT Data, TCS, and Unisys
- Disruptors: DXC, HCLTech, Wipro, and Zensar
- Challengers: Conduent, Eviden, and Kyndryl
Figure 1 below from the full report illustrates these categories:
“State and local governments are using digital transformation to address workforce challenges and improve citizen services by modernizing infrastructure, boosting data security, and ensuring equitable access for resilient, inclusive communities,” said Henry Guapo, managing partner at Avasant.
The reports provide several findings, including the following:
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- Governments are modernizing legacy systems by adopting cloud-based infrastructure and integrating IoT sensor technologies, enabling scalable, efficient, and citizen-centric digital services through real-time resource monitoring and enhanced cross-department collaboration.
- Governments are adopting intelligent automation to streamline repetitive tasks like data entry and form processing, boosting efficiency, reducing costs, and enabling staff to focus on complex work for better citizen services.
- Governments are advancing cross-border data sharing by aligning legal frameworks, adopting common standards, and building decentralized, sovereign ecosystems to ensure secure, interoperable, and trusted exchanges.
- Governments are strengthening cybersecurity by deploying advanced technologies like multifactor authentication and threat detection, while investing in employee training and public awareness to protect citizen data
- Service providers are reshaping the public sector by upgrading technologies to deliver citizen-centric digital experiences, optimizing operations through intelligent automation to address workforce gaps, enabling cross-agency collaboration to create integrated services, implementing advanced data protection strategies to secure citizen information, and promoting equitable access and sustainability.
“Governments are enhancing the citizen experience through personalized services, smarter infrastructure, and sustainability,” said Eratha Poongkuntran, associate research director at Avasant. “These innovations improve quality of life and make cities more efficient, responsive, and livable.”
The RadarView™ also features detailed profiles of 16 service providers, along with their solutions, offerings, and experience in assisting state and local governments in their digital transformation journeys.
This Research Byte provides a brief overview of Avasant’s State and Local Government Digital Services 2025 Market Insights™ and State and Local Government Digital Services 2025 RadarView™ (click for pricing).