TCS Encourages AI Adoption Despite Revenue Concerns
Tata Consultancy Services (TCS) is pushing its workforce to leverage artificial intelligence (AI) for faster and more cost-effective project delivery, even if it temporarily cuts into revenue. CEO K Krithivasan highlighted this bold approach during the Nasscom Technology and Leadership Forum, signaling that the company sees AI not as a threat, but as a productivity booster. The call comes amid growing investor worries that AI could disrupt the labor-intensive Indian IT model, a concern that has already led to a $68.6 billion market value drop for the sector in February.
“We are telling associates that if you find that you can do something faster, better, cheaper with AI, you should probably go and tell your customers, even if it cannibalises revenue,” Krithivasan said at the Nasscom Technology and Leadership Forum in Mumbai.
Industry Outlook: AI as a Job Creator
The TCS CEO’s stance emphasizes a proactive approach to AI, focusing on long-term benefits rather than short-term revenue loss. “We are not afraid this technology will take away our livelihood. We believe it is going to open up more, so you enjoy the benefits the more you do, and not by resisting the change,” he added. This reflects TCS’s strategy to integrate AI into project delivery, enhance productivity, and maintain competitiveness in the global IT services market.
Smaller rivals are adopting a similar outlook. Wipro (WIPR.NS) expects AI adoption to boost demand rather than shrink it. Wipro Chief Strategist and Technology Officer Hari Shetty told Reuters he expects AI to create more jobs than it displaces, signaling optimism across India’s IT industry about the long-term potential of automation and AI-driven services.
Market Reaction: Nifty IT Faces Pressure
Despite the optimism within IT companies, the market has reacted sharply. India’s Nifty IT index (.NIFTYIT) fell 21% in February as of Tuesday’s close, marking its worst monthly performance in nearly 23 years. Analysts say investor fears around revenue cannibalization, job displacement, and AI-driven automation continue to weigh heavily on IT stock valuations, even as the industry pivots toward AI adoption.
(This article has been syndicated from Reuters, edited for clarity)
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