IT firms bank on AI, GenAI to reduce costs

For Indian information technology (IT) services companies, artificial intelligence (AI) and generative AI (GenAI) have yet to secure large deals.

- AVIK DAS

However, they are increasingly being leveraged to reduce costs and improve project efficiency. This, in turn, is allowing clients to reinvest some of the savings into more discretionary initiatives—even amid a volatile macroeconomic environment.

This marks a shift in how traditional IT projects, popularly known as the run-side, achieve cost savings. Over the past three years, this approach has gained traction as traditional cost-saving techniques such as labor arbitrage and the standardization of IT processes have lost relevance.

Enterprises across verticals have realized that unless technologies such as AI and GenAI are built into projects, the desired cost savings will not materialize—a trend that IT services executives say has now become part of all client discussions.