HomeIndustriesAI could destroy call centers, says head of Tata Consultancy Services

AI could destroy call centers, says head of Tata Consultancy Services

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The head of Indian IT firm Tata Consultancy Services said artificial intelligence will result in “minimal” demand for call centers in only a yr, as rapid advances in AI disrupt an enormous industry across Asia and beyond .

K Krithivasan, chief executive of TCS, told the Financial Times that while “there have been no job cuts to this point,” wider adoption of generative AI amongst multinational customers would require the sort of customer support centers that exist in countries resembling India and the Philippines.

“If you ask me, in a super phase there ought to be only a few inbound call centers making any inbound calls in any respect,” he said. “We are in a situation where technology should have the ability to predict an incoming call after which proactively address the client's problem.”

He said chatbots would soon have the ability to research a customer's transaction history and do much of the work that decision center agents do. “That’s where we’re going. . . I don’t think we’re there today – perhaps in a yr or so,” he said.

The prospect that rapidly evolving generative AI tools will replace many forms of employees, including call center agents and software developers, has alarmed policymakers all over the world.

According to industry group Nasscom, greater than 5 million people work in IT and business process outsourcing in India – a worldwide hub for back-office services.

TCS, a branch of India's Tata Group that works with multinational firms to develop their IT systems, employs greater than 600,000 of its own people and generates annual sales of virtually $30 billion.

The company has reported that its pipeline of generative AI projects doubled in comparison with the previous quarter and was price $900 million as of the top of March. Krithivasan said he expects this inflow to “increase significantly” and almost double further in just a few more quarters. The previous payoff was a record order backlog reported this month price $42.7 billion for the fiscal yr ending in March.

However, Krithivasan cautioned that claims in regards to the immediate impact of generative AI are exaggerated. “We are on the stage where we’re spreading the hype that we’re overestimating the advantages,” he said. “The impact could be more long-term than expecting the advantages to be realized in the following two to a few quarters.”

He disputed whether generative AI would result in a decline in overall jobs, arguing that “the world will at all times need more people, not fewer, by way of tech talent – and India has so many individuals.”

The country needs more training of its workforce to capitalize on the demand for technical talent, he added. Many business leaders say large portions of India's graduates lack the talents needed to enter the job market, while raising concerns in regards to the quality of many higher education institutions. Nasscom has previously estimated that fewer than 20 percent of the 1.5 million Indian engineering students who graduate every year find jobs within the industry.

Krithivasan said TCS, which runs its own extensive in-house AI skills program, only directly hires about 10 to fifteen percent of India's colleges, with more work needed to make the remaining “employable.”

“If we will get perhaps 50 percent of schools into college, we’ll create more jobs, and more importantly, we’ll have the ability to satisfy the technology needs that all the global industry could have,” he said.

On overall customer spending on IT services, Krithivasan said inflation, war and upcoming elections created “uncertainty” and discouraged firms in key markets from investing in recent technology projects. TCS's annual currency-neutral sales growth declined to three.4 percent within the last fiscal from 13.7 percent within the previous yr.

Salil Parekh, chief executive of rival Indian IT services firm Infosys, said customer discretionary spending was “slow” after the corporate reported flat annual revenue growth last week.

“We expect this to proceed,” Parekh added. Infosys forecast subdued revenue growth of between 1 and three percent on a continuing currency basis for the following fiscal.


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