Tata Consultancy Services plans 8,900 AI deployment engineers and hunts for AI acquisitions

India's Tata Consultancy Services plans up to 8,900 AI deployment engineers, seeks AI acquisitions

BENGALURU, July 12 (Reuters) - Tata Consultancy Services (TCS.NS), opens new tab is building a team of up to 8,900 forward-deployed engineers and hunting for AI acquisitions as it bets artificial intelligence will create new business rather than undermine outsourcing, two TCS executives told Reuters. The strategy emerges amid investor concern that AI could disrupt India's $315 billion IT services industry by reducing demand for engineering teams, shortening project timelines and squeezing prices as clients seek a share of productivity gains. "We would be ... ensuring that we have as many as 1% to 1.5% of our associates who could be ⁠what you would call FDEs," CEO K Krithivasan said in an interview. TCS (TCS.NS), opens new tab is India's largest software services firm. Krithivasan's figures would translate to roughly 5,900 to 8,900 employees based on TCS's end-June headcount. Krithivasan did not say whether the company would hire externally or retrain existing staff. Forward-deployed engineers embed with clients to accelerate AI adoption and tailor tools to business needs, a role that has emerged as a hiring bright spot in a sector grappling with AI-driven efficiency gains. The plan pits TCS against firms such as OpenAI, Anthropic and Microsoft (MSFT.O), opens new tab, which have expanded hiring for forward-deployed engineers to help clients deploy AI tools. The Mumbai-based company is also evaluating acquisitions in AI, data security and cybersecurity, after largely shunning acquisitions for years and relying instead ⁠on organic growth until late 2025. "We are looking at where we can find things which will help us enable or enhance our strategic positioning," CFO Samir Seksaria said. AI: FRIEND OR FOE? Krithivasan dismissed concerns that AI would disrupt the outsourcing model, arguing that companies still need partners such as TCS to integrate and deploy AI systems. "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. It's essentially because of the talent pool that we have built," Krithivasan said. Companies increasingly use multiple AI models and require partners such as TCS to connect those models ⁠with existing systems and manage data flows, he said. Even so, TCS's annualised AI revenue growth slowed to 13% in the first quarter from 28% in the previous quarter. Krithivasan said he would like the business to grow about 25% quarter-on-quarter ⁠over the long term but that he did not expect a linear trajectory. TCS spends about $1 billion annually on talent development and making AI accessible internally, with a focus on training, targeted hiring and niche recruitment in AI-native technologies, Seksaria said. Reporting by Sai Ishwarbharath B and Haripriya Suresh in Bengaluru; Editing by Dhanya Skariachan and Tom Hogue Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Artificial Intelligence Haripriya Suresh Thomson Reuters Haripriya reports on India's $254-billion Indian information technology (IT) industry, the country's burgeoning GCCs, as well as new-age startups. With seven years of experience, she has previously reported on politics, civic issues, crime, and breaking news in south India, and tracked the country's gig economy. She has a degree in Media Studies with a specialisation in journalism from the Symbiosis Centre for Media and Communication.

Tata Consultancy Services plans up to 8,900 AI deployment engineers, seeks AI acquisitions

Tata Consultancy Services is building a large team of forward-deployed engineers. The company is also actively seeking artificial intelligence acquisitions. This strategy aims to create new business opportunities rather than disrupt outsourcing. TCS believes deep client knowledge is key to integrating and deploying AI systems. The firm is investing significantly in talent development and AI accessibility. Tata Consultancy Services is building a team of up to 8,900 forward-deployed engineers and hunting for AI acquisitions as it bets artificial intelligence will create new business rather than undermine outsourcing, two TCS executives told Reuters. The strategy emerges amid investor concern that AI could disrupt India's $315 billion IT services industry by reducing demand for engineering teams, shortening project timelines and squeezing prices as clients seek a share of productivity ⁠gains. "We would ⁠be ... ensuring that we have as many as 1% to 1.5% of our associates who could be what you would call FDEs," CEO K Krithivasan said in an interview. TCS is India's largest software services firm. Krithivasan's figures would translate to roughly 5,900 to 8,900 employees based on TCS's end-June headcount. Krithivasan did not say whether the company would hire externally or retrain existing staff. Forward-deployed engineers embed with clients to accelerate AI adoption and tailor tools to business needs, a role that has emerged ⁠as a hiring bright spot in a sector grappling with AI-driven efficiency gains. The plan pits TCS against firms such as OpenAI, Anthropic and Microsoft, which have expanded hiring for forward-deployed ⁠engineers to help clients deploy AI tools. The Mumbai-based company is also evaluating acquisitions in AI, data security and cybersecurity, after largely shunning acquisitions for years and relying instead on organic growth until late 2025. "We are looking at where we can find things which will help us enable or enhance our strategic positioning," CFO Samir Seksaria said. AI: FRIEND OR FOE? Krithivasan dismissed concerns that AI would disrupt the outsourcing model, arguing that companies still need partners such as TCS to integrate and deploy AI systems. "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. It's essentially because of the talent pool that we have built," Krithivasan said. Companies ⁠increasingly use multiple AI models and require partners such as TCS to connect those models with existing systems and manage data flows, he said. Even so, TCS's annualised AI revenue growth slowed to 13% in the first quarter from 28% in the previous quarter. Krithivasan said he would like the business to grow about 25% quarter-on-quarter over the long term but that he did not expect a linear trajectory. TCS spends about $1 billion annually on talent development and making AI accessible internally, with a focus on training, targeted hiring and niche recruitment in AI-native technologies, Seksaria said.