Indian IT firms are strategically leveraging Artificial Intelligence (AI) to revitalize their legacy businesses, generating new revenue streams and solidifying their market position in the face of evolving global demands. This approach focuses on integrating AI solutions into existing systems rather than engaging in high-risk, capital-intensive AI research.
Leading Indian IT companies, including TCS, Infosys, Wipro, and Tech Mahindra, are aggressively repositioning themselves as AI-native firms. Instead of competing to create foundational AI models, they are focusing on becoming premier integrators of AI. This strategic shift is reflected in their FY25 annual reports, with themes such as TCS's "AI-First approach", Infosys's "AI Your Enterprise", Wipro's focus on "Helping Clients Build AI-Powered Future-Ready Businesses," and Tech Mahindra's "AI Delivered Right".
This transition is driven by the rising global demand for enterprise AI, with industry estimates projecting the global AI market to reach $1.3 trillion over the next decade. Indian IT firms are investing heavily in upskilling their workforce to meet this demand. TCS reports that over 100,000 employees have acquired advanced skills in AI/ML and GenAI, while Infosys states that over 270,000 employees are now "AI-Aware". Similar reskilling trends are evident at Wipro and Tech Mahindra.
The strategy involves forming partnerships with hyperscalers like Microsoft, Google, and AWS, as well as chipmakers like Nvidia, to access the latest AI models and infrastructure. These firms are also creating dedicated spaces for co-innovation. TCS is establishing AI Centers of Excellence and AI Labs, while Infosys is building its AI foundry, allowing clients to experiment with AI in a controlled environment.
The integration of AI is helping these companies modernize legacy systems and automate IT tasks. Nandan Nilekani, Chairman of Infosys, emphasized the need to modernize legacy systems and create a data architecture that allows all of a firm's data to be used by AI holistically. This includes building "AI foundries and factories" to fuel innovation and scale.
Generative AI is viewed as a "civilizational shift" that will benefit every industry. TCS plans to create a large pool of AI agents to work alongside humans, delivering solutions in a "human AI" model. Wipro is reorganizing its Global Business Lines to align more closely with client needs and capitalize on advancements in AI, cloud computing, and digital transformation.
However, challenges remain. A significant portion of the IT workforce is still focused on legacy systems, highlighting the need for large-scale talent transformation. Engineers need to be equipped with skills in machine learning, data science, generative AI, MLOps, and ethical AI to stay competitive. Moreover, some legacy businesses face internal resistance to adopting AI, requiring inclusive approaches to harness the technology's transformative potential.
Despite these challenges, Indian IT firms are demonstrating resilience and adaptability. They are actively developing strategies to implement AI capabilities and securing new deals based on their AI-enhanced services. This proactive approach aligns with current market dynamics, where AI is driving a significant portion of discretionary IT spending.
