As budgets tighten, Indian IT companies are increasingly turning to artificial intelligence (AI) and generative AI (GenAI) to help clients reduce costs and improve project efficiency. This approach allows clients to reinvest the savings into more discretionary initiatives, making AI and GenAI essential for achieving desired cost savings in traditional IT projects.
Companies like Tata Consultancy Services (TCS) and Infosys are at the forefront of this trend. TCS has already seen success in using AI to help clients reduce costs, with one client achieving a 20% cost saving by leveraging AI in a part of their portfolio. Infosys has also reported a 20-25% productivity benefit in areas like process solving, engineering, and customer service using tools built on public models.
With 400 AI projects underway, Infosys is sharing benefits with clients where applicable. However, IT service providers face a new challenge in providing definitive savings upfront to win new-age deals from clients. Analysts note that enterprises need to modernize their technology to realize savings and productivity gains from AI.
The trend is driven by increasing adoption of AI and emerging tech, with 86% of Indian CEOs viewing these technologies as key investment priorities for growth. CEOs are prioritizing investment in people and strategic vision to maintain a competitive edge, with many confident about optimizing operations and boosting productivity through digitalization.
