{"id":31961,"date":"2024-04-21T12:52:55","date_gmt":"2024-04-21T12:52:55","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/21\/talent-ai-volution-can-ai-adoption-dent-indias-tech-edge\/"},"modified":"2024-04-21T12:52:55","modified_gmt":"2024-04-21T12:52:55","slug":"talent-ai-volution-can-ai-adoption-dent-indias-tech-edge","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/21\/talent-ai-volution-can-ai-adoption-dent-indias-tech-edge\/","title":{"rendered":"Talent AI-volution: Can AI adoption dent India’s tech edge?"},"content":{"rendered":"
\"Talent<\/div>


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India<\/a> is known as the world\u2019s tech backbone. Not without reason. The $250-billion Indian software services<\/a> industry, aside from the mammoth GCC industry, caters to the biggest global companies of the world. The sheer breadth and depth of talent burnishes India\u2019s allure \u2014 and makes it the automatic destination for solving complex service industry problems.
However, recent advances in generative AI<\/a> are raising doubts about whether India will continue to have its edge given the inevitability of automation<\/a> that AI will spawn.<\/p>\n
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The market size of generative AI in customer services sector was valued at $308.4 million in 2022 and is expected to cross $2,897.57 million by 2032, growing at a CAGR of 25.11% over this period, according to Precedence Research.<\/p>\n

To slash costs, most organisations in India are looking at cutting their marketing and customer experience budgets, as per a 2023 Adobe study. About 42% have already done so, and 37% will in the next 12 months, it said.
In fact, 59% of brands are instead seeking to drive efficiencies in these areas by deploying gen AI<\/a>.<\/p>\n

In February, Jensen Huang, CEO of AI chip making giant Nvidia, said that with the arrival of AI, the future of coding<\/a> as a career is dead. In a January blog, Kristalina Georgieva, MD, IMF, wrote that AI will affect almost 40% of jobs around the world, replacing some and complementing others. <\/p>\n

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Discover the stories of your interest<\/h3>\n<\/div>\n
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\"GDD\"ETtech<\/span><\/figure>\n<\/div>\n

\u201cIt doesn\u2019t take a rocket scientist to conclude that a million of the seven million Indian employees supporting routine-based testing and coding work could be eliminated in the next couple of years,\u201d said Phil Fersht, CEO and chief analyst, HFS Research, in what is an objective assessment on the fate of jobs repetitive in structure and content.
In India, market trends suggest that more than 16 million working employees will need reskilling and upskilling due to AI\u2019s influence by 2027, according to HR services firm TeamLease Digital.<\/p>\n

Huang\u2019s words seemed even more ominous with the recent launch of Devin, \u201cthe world\u2019s first fully autonomous AI software engineer\u201d, developed by US startup Cognition. Devin\u2019s capabilities achieved a 13.86% accuracy on the SWEBench benchmark, which assesses AI models on software engineering tasks, far outperforming the capabilities of the next best model, Claude 2 at 4.8%.<\/p>\n

The bot can practically be a collaborative co-worker. \u201cDevin reports on its progress in real time, accepts feedback and works together with you through design choices as needed,\u201d Cognition said in a blog post. Devin now even has an Indian counterpart \u2014 Devika \u2014 an AI created by Mufeed VH of Lyminal and Stition.AI.<\/p>\n

Crowd thinning
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ET had reported on March 14 that the IT industry<\/a> was set to miss its staff doubling target of 10 million employees by 2030. It will reach only about seven million by the end of the decade, Teamlease Digital estimated. This slowing in pace of headcount addition is in large part due to AI, experts said.<\/p>\n

Fersht said that Indian support services could lose a million positions over the next couple of years, as LLMs rapidly change how routine IT testing and coding work are delivered. \u201cFor 25 years, Indian IT services have profited
from each of these technological shifts, as enterprises groped for bread-and-butter IT support to fix bad code, test portfolios of legacy apps, maintain creaking infrastructures and generally keep the IT wheels on global 2000 corporations hellbent on sustaining archaic business operating models that have barely changed since World War II\u2026 Many enterprise clients are crying out for help, but their partners are struggling to win their hearts. It\u2019s now time for India\u2019s leaders to rethink how their firms operate and address gen AI,\u201d Fersht said.<\/p>\n

\u201cTech roles are actually very, very susceptible to getting displaced by gen AI,\u201d said Alpana Dutta, a partner at EY India. \u201cOrganisations are not going bold because there are considerations of ethics, data sanctity, etc. But from a first principles perspective, roles like software developer, code generator, optimisation, QA testing, integration testing, load testing, blockchain engineers, network administrator \u2014 all of these are very good candidates for getting automated.\u201d<\/p>\n

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\"DisruptionETtech<\/span><\/figure>\n<\/div>\n

\u201cJust being a plain Jane customer service person or just being a coder may not be enough,\u201d Dutta said,
adding that these skills have to transform. Ganesh Natarajan, former CEO of Zensar Technologies and founder
of digital transformation solutions company 5F World, had told ET that traditional roles like coding, testing
and maintenance, which make up about 60% of IT jobs, are being \u2018taken over\u2019 and \u2018cannibalised\u2019 by
AI and could drop precipitously to just 15%. He added that while automation and gen AI can be used
as an augmenting and enabling force too, in these areas it was essentially an autonomous force.<\/p>\n

\u201cThe fact of the matter is that the growth of manpower will not be linked to the growth of revenue. That is very clear,\u201d Natarajan said. \u201cWe will soon be dealing with a very heterogeneous workforce, where there will be people and
there will be lots of robots and AI.\u201d<\/p>\n

GCCs outdo pureplays
<\/strong>
Over the past few quarters, when the IT headcount scenario has been bleak, continued hiring by Global Capability Centres was seen as a bright spot. But Natarajan contends that even there, once the large GCCs are fully populated over the next few years, it will meet the same fate with extensive leveraging of technology<\/a>.<\/p>\n

According to Arvind Thakur, former vice-chairman and MD of NIIT Technologies, now a board member at NIIT University, the IT industry is at an inflection point, with a larger shift underway from labour arbitrage to AI-driven tech arbitrage, he said. <\/p>\n

\u201cIf we look at the earlier practices of off-shoring, near-shoring, DevOps \u2014 all the things the industry was doing were driving around 30% productivity and 5-10% continuous improvement. But we are now going to move to the next S-curve of growth with AI driven decision making. So, new approaches like RPA (robotic process automation), low code\/no code, process mining, machine learning, Gen AI \u2014 these things are now
going to become centre stage. And you start seeing additional 50 -70% productivity happening in the workforce going forward,\u201d Thakur said. <\/p>\n

While the industry understands the need for reskilling, some executives are also ringing alarm bells about the need for specialised learning paths, citing that as few as five% of organisations globally are spending on reskilling workers on gen AI.<\/p>\n

Fersht highlighted that the winners will be the partners who can quickly understand what needs to be done to fix and scale the data without charging the world, yet with the ability to work fast and smart. \u201cWhen you look at the deep institutional relationships the likes of Cognizant, HCL, Infosys, TCS, etc have with their clients, many of whom are into fourth or even fifthgeneration contracts, surely these firms have a tremendous opportunity to convince enterprise leaders to take a risk with them to make the painful changes necessary to capitalise on genAI tech,\u201d he added. \u201cIndia\u2019s leaders must stop viewing gen AI as merely the next shiny tech tool, as opposed to what it really is: A truly disruptive technological evolution that will fundamentally change business models and radically change how we invest in technology solutions and services. All they need to do is look at the flourishing ecosystem of startups
covering all angles of AI and industry solutions and embrace some of the entrepreneurial culture that once made them successful,\u201d Fersht added.<\/p>\n

Other side of the debate <\/strong><\/p>\n

Having said all that, however, many industry leaders remain optimistic about the situation. Speaking at Nasscom Technolog y and Leadership Forum (NTLF) about the impact on talent demand due to the use of A I, TCS CEO K Krithivasan said that it will only increase demand for new skills rather than reduce talent requirement. \u201cWhile AI can improve productivity during production cycles, there will be a higher need for critical skills to address
the stages of requirement gathering or even post-production use cases. So, we assume that AI adoption will not reduce the number of people required,\u201d he said, adding that skills in critical thinking, strategic planning and output validation for a superior user experience need to be included as part of the next generation of training
models for employees. <\/p>\n

Vineet Nayar, former CEO, HCL Technologies, said, \u201cRepetitive work like coding, testing and service management can be done with significantly smaller teams. However, it is also true that customers have no choice but to double down on investments in AI to transform their own business, thus you would see a very high demand for AI savvy skills.<\/p>\n

Overall impact of AI will be a significant increase in spending on technology by customers \u2014 thus more demand for skills and more output from each person.\u201d<\/p>\n

He cautioned, however, that \u201cIf you are an employee in IT \u2014 it\u2019s time to reskill today as the day after tomorrow may be too late.\u201d

One window to the next<\/strong><\/p>\n

Experts point to other silver linings too. EY\u2019s Dutt pointed out that new roles like AI trainer, AI ethics specialist, AI UX designer etc, are emerging, and \u201cthese are roles that you can morph into if you have a strong base in some of
the older roles\u201d, she said, adding that India has been fast in adopting some of the AI-related skills.<\/p>\n

Moreover, while certain skills may become redundant in the IT services or ITeS setup, they may remain very relevant for other industries. \u201cYou could see people with certain skills in the IT industry being not so relevant, but still relevant for some of our core sector industries because they are way behind in their digital and automation journey. You will also see some from these industries into other core manufacturing, production type of industry because they are also trying to significantly elevate their digital journey. What is average skill in the IT industry could become a very valuable and premium skill given the maturity of digital and tech in some of these other oldworld industries,\u201d Dutt said.<\/p>\n

International tailwinds may help India along as well. For instance, Rajnil Mallik, partner and gen AI go-to-market leader at PwC India, noted that the AI executive order passed by US President Joe Biden, while regulatory in nature, is also upbeat and, crucially, acknowledges that the US cannot make progress in AI on its own. Indian talent being a \u2018known entity\u2019 will be an advantage, he said.<\/p>\n

\u201cOne thing that\u2019s not going to change is that India remains one of the largest pools of Englishspeaking talent in the world, and we have very good coding skills,\u201d Mallik said, adding that the near future is AI plus humans, and not AI alone. <\/p>\n

The disruptive technology has a l so pu shed people to innovate \u2014 for instance, the coming of LLMs has changed the nature of coding, bringing new disciplines like open source LLMs, training, finetuning, prompt engineering etc, Mallik noted, and this innovation will accelerate in the coming years.<\/p>\n<\/div>\n


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India is known as the world\u2019s tech backbone. Not without reason. The $250-billion Indian software services industry, aside from the mammoth GCC industry, caters to the biggest global companies of the world. The sheer breadth and depth of talent burnishes India\u2019s allure \u2014 and makes it the automatic destination for solving complex service industry problems.However, […]<\/p>\n","protected":false},"author":2,"featured_media":31962,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/img.etimg.com\/photo\/88591548.cms","fifu_image_alt":"","footnotes":""},"categories":[607],"tags":[4720,1274,35890,22009,18354,8730,1105,7860,273,925,23783,35889,2689,2416,459],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/31961"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=31961"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/31961\/revisions"}],"predecessor-version":[{"id":31963,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/31961\/revisions\/31963"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/31962"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=31961"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=31961"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=31961"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}