Tata Consultancy Services is building a team of up to 8,900 forward-deployed engineers and hunting for AI acquisitions, CEO K Krithivasan and CFO Samir Seksaria told Reuters, as India's largest IT services firm bets that artificial intelligence will create new business rather than undercut its outsourcing model.
The move comes amid investor concern that AI could disrupt the $315 billion Indian IT services industry by reducing demand for engineering teams, shortening project timelines and squeezing prices as clients seek a share of productivity gains. The strategy reflects a broader transformation in how enterprise IT leaders are approaching AI deployment, a topic detailed in AI for Executives & Strategy.
Forward-deployed engineers: a new battleground
Krithivasan said the company aims to have 1% to 1.5% of its workforce serve as forward-deployed engineers (FDEs), translating to roughly 5,900 to 8,900 employees based on TCS's end-June headcount. He did not specify whether the company would hire externally or retrain existing staff. "We would be … ensuring that we have as many as 1% to 1.5% of our associates who could be what you would call FDEs," Krithivasan said.
Forward-deployed engineers embed with clients to accelerate AI adoption and tailor tools to business needs, a role that has become a hiring bright spot in a sector dealing with AI-driven efficiency gains. The plan puts TCS in direct competition with firms such as OpenAI, Anthropic and Microsoft, which have also expanded hiring for these client-facing AI integration roles.
Acquisition strategy shifts
After years of relying on organic growth, TCS is now evaluating acquisitions in AI, data security and cybersecurity. CFO Samir Seksaria said, "We are looking at where we can find things which will help us enable or enhance our strategic positioning." The company's pivot to inorganic growth began in late 2025, marking a departure from its long-held preference for building capabilities internally.
AI: Friend or foe?
Krithivasan pushed back against fears that AI would dismantle the traditional outsourcing model, arguing that companies still need partners to integrate and deploy AI systems. "What you need is a deep knowledge of the customer environment to make it work. That is where we differentiate ourselves. This has nothing to do with cost arbitrage. It's essentially because of the talent pool that we have built," he said.
Even so, TCS's annualised AI revenue growth slowed to 13% in the first quarter from 28% in the previous quarter. Krithivasan said he would like the business to grow about 25% quarter-on-quarter over the long term but did not expect a linear trajectory. The company spends roughly $1 billion annually on talent development and making AI accessible internally, Seksaria said.
Why this matters for executives and strategy
TCS's move to embed thousands of AI engineers directly with clients signals that the next phase of AI adoption will be won on the ground, not just in the lab. For executives, the strategy underscores a shift from selling AI as a tool to delivering it as a service integrated into existing workflows. The competition for forward-deployed talent-and the willingness to acquire for AI capabilities-marks an escalation in the race to turn AI potential into enterprise revenue.
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