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India’s leading IT services providers – Tata Consultancy Services (TCS), Infosys, HCLTech, and Wipro—are rapidly shifting from traditional outsourcing models to AI-centric approaches in response to changing client expectations and intensifying global competition.

As businesses globally are seeking greater efficiency, innovation, and digital transformation, these IT firms are embedding artificial intelligence (AI) across their offerings to deliver enhanced productivity, automation, and scalable solutions. This evolution is driven by the need to move beyond labour-intensive services, address margin pressures, and provide clients with future-ready, technology-driven value.

“To enable this transformation, Indian IT majors are investing heavily in proprietary AI platforms, reskilling their workforce, and forming strategic partnerships with global technology leaders. By integrating AI into service delivery, automating routine tasks, and co-innovating with clients, these companies aim to maintain their global leadership and relevance in a rapidly changing market. The shift to AI-centric models is essential for their continued growth, competitiveness, and ability to meet the evolving demands of the digital economy,” says DD Mishra, VP Analyst at Gartner.

For instance, IT services major Infosys launched Topaz, an AI-first set of services, solutions, and platforms using generative AI (GenAI) technologies.

“It helps amplify the potential of humans, enterprises and communities to tap into the next generation of opportunities to create value from unprecedented innovations, connected ecosystems and pervasive efficiencies. Infosys Topaz leverages Infosys-applied AI framework to build an AI-first core that empowers people to deliver cognitive solutions that accelerate value creation,” Infosys said in a statement.

“Infosys Topaz is helping us amplify the potential of people – both our own and our clients. We are seeing strong interest from our clients for efficiency and productivity enhancing programs, even as businesses are keen to secure their future growth. Our own business operations have been hugely benefited by Infosys Topaz bringing the power of generative AI platforms and data solutions. Today, our clients are building new paths to expand revenue-creating opportunities and grow with Infosys Topaz,” Salil Parekh, CEO and MD, Infosys, said during the launch.

In August 2023, TCS established its AI.Cloud unit to unlock greater business value by harnessing the power of cloud and GenAI. Earlier this year, TCS reorganised its AI.Cloud division into two distinct business units as the company aims for higher growth in the AI cloud business.

Last year, Wipro launched its Lab45 AI platform, which leverages GenAI, machine learning, and deep learning technologies to enable companies to realize enhanced efficiencies, transform business functions, and enable industry-specific solutions.

The Lab45 AI Platform runs on a SaaS (software-as-a-service) model and supports various large language models (LLMs) from leading providers as well as custom deep-learning and other models. With over 1,000 GenAI agents and more than 10 GenAI applications, the platform offers no code and low code pre-built applications for HR, sales, marketing, and operations functions, while also allowing for the easy creation of industry specific GenAI agents and applications.  

Power of Partnerships

Companies are also betting on partnerships to gain competitive advantage in AI. For example, TCS has recently expanded its collaboration with Nvidia to launch industry-specific solutions and offerings that will help customers adopt AI faster and at scale. These solutions and offerings will be delivered through TCS’s new business unit focused on Nvidia, under its AI.Cloud business unit. The new business unit builds on a collaboration with Nvidia for over five years, brings together the complementary capabilities of both organisations and offers tailored offerings for various industries.

Enterprises worldwide are racing to adopt AI but there is no consensus on an AI adoption strategy, according to the recent TCS AI for Business Study. The AI adoption journey for every enterprise is unique and involves an interplay of AI and existing enterprise capabilities. AI adoption at scale requires an intimate understanding of the enterprise and its practices and building AI models that are customized for the context.

To solve this unique challenge, TCS’s new unit was designed to deliver curated AI adoption strategies by leveraging global centres of excellence (CoEs) and investments in the Nvidia AI platform.

“Curated AI journeys are derived at the intersection of deep-domain and deep-tech. This is a space that TCS has excelled at during every business transformation cycle. Our unique vantage point, at the intersection of business and technology, helps us identify the right opportunities for our customers. With the innovative and efficient Nvidia AI platform, and our wide scale and proven track record in delivering value, our customers now have a means to faster value realisation,” said Siva Ganesan, Head, AI.Cloud Unit, TCS.

Similarly, earlier this year, Wipro partnered with Nvidia to launch new agentic AI services to help nations around the globe develop and deploy AI capabilities leveraging their unique infrastructure, data, workforce and business networks to drive innovation, economic growth and sovereignty.

“The offerings leverage AI for local impact by bringing together Wipro’s locally governed AI frameworks powered by Wipro’s WeGA Studio and NVIDIA AI Enterprise software,” Wipro said in a statement.

“There’s a rising demand for ethical AI practices and transparency in AI decision-making processes,” says Nagendra Bandaru, President and Managing Partner, Wipro Technology Services. “Organisations are seeking AI solutions that are not only effective but also ethical and transparent. By working together with Nvidia, we will be able to quickly deploy AI agent systems and technologies while addressing the increased concerns many government agencies and organizations have over data privacy, security, and national sovereignty.”

What Lies Ahead

With the exception of TCS and Accenture, most IT services providers have been cautious about disclosing their AI-specific revenues, primarily because AI is often bundled within larger digital transformation projects rather than being a distinct revenue stream.

“As client expectations for measurable AI-driven results increase and the technology becomes more mainstream, it is anticipated that more firms will start reporting AI-related revenues to highlight their expertise and strengthen their market positioning. In the coming years, transparent AI revenue reporting is likely to become a significant differentiator, as clients demand greater clarity and demonstrable value from their technology partners,” says Mishra of Gartner.

To stand out and succeed in the AI landscape, IT services companies will need to move beyond basic AI adoption. He says that winning will require substantial investments in proprietary AI platforms, the development of deep industry expertise, and the delivery of tailored, industry-specific solutions that address concrete business challenges.

“Differentiation will also hinge on the ability to scale AI implementations, integrate AI solutions with existing legacy systems, and uphold strong data governance and ethical standards. Companies that can deliver measurable business outcomes, drive co-innovation with clients, and continually upskill their workforce in advanced AI technologies will be best positioned to lead as the market continues to evolve,” Mishra added.

Basically, India’s IT services sector is at an inflection point. As clients shift from outsourcing to intelligence, the winners will be those who can combine AI-led innovation, consulting depth, and platform thinking, moving beyond headcount. This shift from labour-led models to intelligence-led outcomes marks a defining moment for the industry. As they navigate this complex transition, success will hinge not only on adopting cutting-edge technologies, but on cultivating trust, agility, and a deep understanding of evolving client needs. The age of AI-first IT services has begun and this is just the beginning!

(The story first appeared in the print version of Entrepreneur India)