TCS not afraid of AI, open to revenue cannibalisation: CEO

Mumbai: Tata Consultancy Services (TCS) is “not afraid” of artificial intelligence and is comfortable even with revenue “cannibalisation” if AI-led solutions deliver greater value to customers, Managing Director and CEO K Krithivasan said on Wednesday.

Speaking at the annual NTLF event, Krithivasan said TCS actively encourages its associates to deploy AI tools at client sites, even if it results in reduced billable revenues. “We encourage our associates to go out and use AI, even if it means cannibalising our revenues,” he said.

TCS, which has over six lakh employees, is insisting that every associate become AI-fluent. The company, he stressed, is not worried about AI threatening livelihoods and sees it instead as a major productivity enhancer. Associates are being asked to explore AI applications in projects, even if that means forgoing some revenue in the short term.

Krithivasan noted that while younger employees are proficient in building AI-based solutions, senior-level staff tend to be slower, as they read extensively about AI but do not actively build solutions. He stressed that AI adoption goes beyond giving prompts to generative AI platforms such as ChatGPT, and requires hands-on development.

Terming AI a “civilizational shift”, Krithivasan said it represents the democratisation of knowledge and is solving problems that remained unresolved for decades. AI has also become a board-level agenda, with chief information officers being tasked to identify enterprise use cases.

Amid growing governance concerns, he said TCS is exploring models where AI systems can govern other AI systems through multiple agents. At the same event, Kotak Mahindra Bank CEO and MD Ashok Vaswani said the bank aims to be a “fast follower” in AI adoption, leaving technology decisions to technologists.

TCS’s position is similar to that of rival Wipro. Wipro’s Chief Strategist and Technology Officer, Hari Shetty, recently said he expects rapid AI adoption to increase demand for software services rather than reduce it.

He added that AI is likely to create more jobs than it eliminates.

Shetty described AI as one of the biggest technological shifts of our time.