Omdia analysts review key takeaways from the Hitachi Digital Services partner event, with highlights on topics like AI, cybersecurity, automotive, and IoT.
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Summary
In May, Omdia analysts had the pleasure of attending the inaugural Hitachi Digital Services (HDS) partner event in Dallas. The two-day event was a great chance to connect with HDS leadership and to hear updates from across the business. The agenda was packed with updates across a range of technologies, capabilities, and sectors, providing insights into HDS’s strategy, direction, and outlook.
HDS CEO Roger Lvin’s keynote and opener on day one established from the outset that HDS is first and foremost an engineering and R&D-focused company with a vast history and pedigree. As a company, HDS is focused on specific industry verticals and applications, with engineers at the heart of how they work with clients. Those engineers have domain-specific knowledge that is key to understanding applications for disruptive technology, including artificial intelligence (AI). As AI technology affects every sector, company, and region, the HDS approach has been to establish “Hitachi Application Reliability Centers (HARC)” in 2022, which has since been enhanced with AI. In 2025, HDS launched the “Centre for Architecture and AI,” which focuses on AI integration with next-generation architectures.
Figure 1: Driving innovation with AI
Source: Hitachi Digital Services
The vision is to combine existing functional/domain knowledge with cutting-edge technology (including multimodal AI, industrial AI, and agents) to drive organizational intelligence. The aim is to support the transformation of both industrial and enterprise operations. As shown in Figure 2, Omdia’s research identifies the leading drivers of AI adoption in manufacturing applications.
Figure 2: Operational technology (OT) AI adoption drivers
Source: Omdia
Of course, there are some not-so-inconsequential challenges facing HDS on this journey, including AI reliability and scalability, not to mention the growing talent/skills gap, which is both a driver and a barrier to AI adoption.
Using AI to optimize OT cybersecurity
HDS includes a dedicated cybersecurity division, which focuses on a range of verticals including manufacturing, energy, and finance. With hackers increasingly using AI tools, which reduce the need for specialist knowledge and scale attacks more quickly and easily, HDS has seen a surge in support needs. HDS is optimizing cyber with AI, while guiding clients on using AI to check for vulnerabilities. However, cyber responsibility is still often divided and under-resourced. It is not uncommon to have fewer than five dedicated cybersecurity professionals in companies of over 10,000 employees.
According to Omdia’s Cybersecurity Decision-Maker Survey 2024, cost remains the primary concern for decision makers when purchasing IoT cybersecurity solutions. For OT-centric industries, budget remains one of the top three issues most affecting the security function within the organization. However, many areas of IoT cybersecurity are expected to see promising growth—notably identity, authentication, and access technologies. The OT security market has recently experienced rapid expansion, and to support the HDS cyber offering, a recent partnership with Google has been agreed.
What was predominantly an asset visibility market has expanded into various cybersecurity platforms, including IoT/OT security, network security, and industrial automation vendors. Partnerships are critical to ensuring cyber solution offerings meet specific customer needs while being scalable and holistic. Offerings in the space often span multiple technology categories, with a recent focus on risk and vulnerability management, infrastructure security offerings, and secure remote access.
Automotive – HDS covering the entire value chain
In the automotive discussions, what stands out immediately is HDS’s deep-rooted integration across the entire value chain. Unlike many players who specialize in either software platforms or industrial services, HDS offers vertically integrated capabilities—from digital product planning and smart manufacturing to after-sales optimization and connected customer experiences. This end-to-end ambition positions Hitachi as more than just a technology partner; it is increasingly becoming a transformation orchestrator.
Figure 3: HDS offerings across the automotive value chain
Source: Hitachi Digital Services
A recurring theme throughout the event was HDS’s ability to blend information technology (IT) with OT. Its experience operating its own industrial businesses (from Astemo car parts to Hitachi Rail to Hitachi Energy) gives it credibility few competitors can claim. One of the examples shown was a multiyear manufacturing digital transformation (MDT) initiative with one of the world’s largest automakers. HDS helped define a North Star IT/OT architecture—a layered, modular blueprint connecting cloud, digital twin, and generative AI (GenAI) capabilities to core manufacturing workflows. It delivered tangible progress on four critical vectors: machine reliability, production throughput, logistics, and quality.
HDS’s freight payment platform for a leading North American OEM was another standout. Processing over $2bn in annual freight payments, this real-time solution combines invoice automation, error reconciliation, and logistics partner coordination. The scale is massive, supporting daily vehicle movements across truck, rail, and marine.
The company also showcased AI-guided diagnostics for a fleet of over 100,000 vehicles. By integrating real-time vehicle data with supply chain systems, HDS helped reduce breakdowns, improve uptime, and cut maintenance costs by $18m annually. This was not speculative AI—it was embedded intelligence at work.
HDS’s strategy is compelling and built on dual transformation: deep OT heritage from manufacturing, energy, and transportation and full-stack IT capabilities spanning cloud, enterprise resource planning (ERP), AI, and customer experience (CX). This positions HDS to serve as a transformation integrator for OEMs and tiered suppliers navigating electrification, connectivity, sustainability, and operational resilience.
Appendix
Author
Mark Watson, Senior Research Director, Manufacturing Technology
Shobhit Srivastava, Senior Principal Analyst, IoT
