TCS turns to AI deployment engineers as outsourcing model shifts

A services giant moves AI closer to clients

Tata Consultancy Services is preparing a more client-embedded AI push, with CEO K Krithivasan saying the company wants 1% to 1.5% of its associates to serve as forward-deployed engineers, or roughly 5,900 to 8,900 people based on its end-June workforcereuters +1. Reuters described the effort as a plan to build up to 8,900 AI deployment engineers while also looking for artificial-intelligence acquisitions95kqds. The roles are meant to sit with customers, speed up adoption and tailor AI tools to business needs rather than operate as a conventional offshore delivery benchreuters +1.

The move makes the largest Indian software-services company a more direct participant in the enterprise AI deployment race. Similar client-facing engineering teams have become a hiring focus at OpenAI, Anthropic and Microsoft as large customers try to move from pilots to working systemsreuters +1.

AI pressure is reshaping the outsourcing pitch

The strategy lands as investors question whether generative AI will squeeze India’s $315 billion IT services industry by reducing the need for large engineering teams, shortening project timelines and pushing customers to demand a share of productivity gainsreuters +1. TCS is trying to frame that pressure as a services opportunity: the harder AI becomes to integrate into old systems and messy data flows, the more customers may need outside partners.

Krithivasan rejected the idea that AI undercuts the outsourcing model, saying the key advantage is “deep knowledge of the customer environment” and that the work “has nothing to do with cost arbitrage”reuters +1. His argument is that companies will use multiple AI models and still need help connecting them to existing technology estates, security rules and data pipelinesreuters +1.

Deals could fill gaps training cannot

The company is also evaluating acquisitions in AI, data security and cybersecurity after relying largely on organic growth for yearsreuters +1. CFO Samir Seksaria said TCS is looking for assets that can “enable or enhance” its strategic positioning, signaling that the acquisition push is tied to capability gaps rather than simple scalereuters +1.

The urgency is visible in the company’s AI growth numbers. Annualized AI revenue growth slowed to 13% in the June quarter from 28% in the previous quarter, even as Krithivasan said he would like the business to grow about 25% quarter over quarter over the long termreuters +1. Seksaria also said TCS spends about $1 billion annually on talent development and internal AI access, including training, targeted hiring and AI-native recruitmentreuters +1.