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The head of Indian IT company Tata Consultancy Services has said artificial intelligence will result in “minimal” need for call centres in as soon as a year, with AI’s rapid advances set to upend a vast industry across Asia and beyond.
K Krithivasan, TCS chief executive, told the Financial Times that while “we have not seen any job reduction” so far, wider adoption of generative AI among multinational clients would overhaul the kind of customer help centres that have created mass employment in countries such as India and the Philippines.
“In an ideal phase, if you ask me, there should be very minimal incoming call centres having incoming calls at all,” he said. “We are in a situation where the technology should be able to predict a call coming and then proactively address the customer’s pain point.”
He said chatbots would soon be able to analyse a customer’s transaction history and do much of the work done by call centre agents. “That’s where we are going . . . I don’t think we are there today — maybe a year or so down the line,” he said.
The prospect of rapidly advancing generative AI tools replacing many types of white-collar workers, including call centre agents and software developers, has alarmed policymakers around the world.
In India — a global hub for back-office services — more than 5mn people work in IT and business process outsourcing, according to industry group Nasscom.
TCS, an arm of India’s Tata conglomerate that works with multinationals to develop their IT systems, has more than 600,000 employees of its own and annual revenues of nearly $30bn.
The company has reported that its pipeline of generative AI projects doubled quarter over quarter to be worth $900mn to the end of March. Krithivasan said he expected that flow to “increase significantly” and almost keep on doubling over a few more quarters. The pay-off so far has been a record order book reported this month worth $42.7bn for the financial year ending in March.
However, Krithivasan cautioned that claims of the immediate impact of generative AI were overblown. “We are in the phase where we are in a hype that we are overestimating the benefits,” he said. “The impact would be seen more long term than expecting to get the benefits in the next two to three quarters.”
He disputed whether generative AI would lead to a reduction in overall jobs, arguing that “the world is going to need more and more people, not fewer people, in terms of technology talent — and India has so many people”.
The country needed more workforce training to take advantage of this demand for tech talent, he added. Many business executives say that large swaths of India’s graduates lack enough skills to be employable, amid concerns about the quality of many higher education institutions. Nasscom has previously estimated that fewer than 20 per cent of India’s 1.5mn engineering students graduating each year get industry jobs.
Krithivasan said that TCS, which runs its own vast internal AI-skilling programme, only hires directly from about 10 to 15 per cent of Indian colleges, with more work needed to make the remainder “employable”.
“If we can go to maybe 50 per cent of the colleges, we provide more employment, and more importantly, we will be able to address the technology demand the overall global industry is going to have,” he said.
On overall IT services spending by customers, Krithivasan said inflation, war and upcoming elections were driving “uncertainty”, putting off businesses in key markets from investing in new tech projects. TCS’s annual currency-adjusted revenue growth declined to 3.4 per cent in its last financial year, down from 13.7 per cent the previous year.
Salil Parekh, chief executive of rival Indian IT services company Infosys, said discretionary outlays by customers had been “slow” after it reported flat annual revenue growth last week.
“We see that continuing,” Parekh added, with Infosys forecasting muted sales growth of between 1 and 3 per cent over the next financial year on a constant currency basis.
Source: Economy - ft.com
