TCS builds bench of 8,900 AI engineers

To accelerate AI adoption, Tata Consultancy Services plans to deploy up to 8,900 engineers who will work directly with clients. The Indian IT services behemoth is also looking to acquire companies in AI, data security, and cybersecurity.

One of the most important outsourcing companies, TCS, has made a change that shows how a company that has grown organically is repositioning itself as AI reshapes how businesses spend on technology. The timing isn’t the best because TCS says that annualized AI revenue growth slowed to 13% in the June quarter, down from 28% the previous quarter.

TCS CEO says embedded roles aren’t about cost cutting

According to a Reuters report, CEO K. Krithivasan stated that forward deployed engineers would account for 1% to 1.5% of TCS’s workforce as of the end of June. These are the people who work inside a customer’s operation to customize tools and get AI systems running.

Krithivasan declined to say whether TCS intends to hire new engineers or retrain current employees. OpenAI, Anthropic, and Microsoft are all expanding similar client embedded roles.

Krithivasan disputed claims that AI weakens the case for outsourcing. “What you need ​is a deep knowledge of ​the customer environment to ⁠make it work. That is where we differentiate ourselves. This has nothing to do with cost arbitrage,” he told Reuters.

TCS is considering acquisitions after relying heavily on internal growth for many years. CFO Samir Seksaria said the company is looking to acquire companies that will strengthen or expand its strategic position. According to Seksaria, TCS invests ~$1 billion annually in talent development and AI tools for all employees.

Krithivasan set a long term goal of ~25% quarter-on-quarter growth for the business; however, he warned that the path would not be straight.

AI investment continues to flow into India. According to a Cryptopolitan report, Amazon announced in June that it would increase its India investment by $13 billion, bringing its total commitment to $48 billion through 2030 for AI and cloud infrastructure in the Mumbai and Hyderabad regions. Microsoft has pledged $17.5 billion and Google $15 billion for AI and cloud deployments in the country.

The three businesses plan to spend a total of $80 billion over the next five years. That money is chasing India’s engineering talent pool and its growing market for digital services. These are the same factors that TCS is counting on for its push into embedded engineering.

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