Babak Hodjat, the chief AI officer at Cognizant, argues that worries about new AI tools replacing major IT services companies are exaggerated because businesses still require expert support to properly implement and expand these technologies.
AI Fears Overstated as Businesses Still Rely on IT Service Experts, Says Cognizant’s AI Chief
The rise of automated AI systems developed by startups like Anthropic has sparked anxiety across the global software and services sector, particularly in India’s labor-heavy IT services industry, about possible disruptions to traditional business models.
Hodjat explains that companies are nowhere near being able to depend on a single, universal AI agent to handle all their needs.
He emphasizes that most organizations still need assistance with designing, integrating, and managing AI systems within their operations.
As he puts it, “That mapping is our job, it does not come just automatically out of the box,” highlighting that AI solutions require structured guidance rather than functioning independently from the start.
Hodjat, who previously contributed to the development of Apple’s Siri voice assistant, reinforces his view that specialized service firms remain essential in the AI adoption process.
Cognizant, which is listed on Nasdaq and has over 70% of its workforce based in India, has projected annual revenue higher than Wall Street expectations, driven by growing demand from companies incorporating AI into their workflows.
Other major Indian IT firms, including Tata Consultancy Services and Wipro, share the belief that faster AI adoption will increase demand for software service providers instead of reducing it.
Despite this optimistic outlook, AI-related job reductions are already occurring in parts of the industry.
WiseTech Global, a company specializing in shipping and logistics management software, announced plans to cut nearly one-third of its workforce as it introduces AI into both customer-facing software and internal processes.
TCS Announces 12,000 Layoffs Amid AI Speculation as Cognizant Expands AI-Generated Code to 50%
Tata Consultancy Services also revealed 12,000 job cuts last year, though it later denied claims in local media that those layoffs were directly tied to AI.
Within Cognizant itself, around 30% of its code is currently generated using AI, and the company aims to increase that share to 50%.
Even so, Cognizant does not anticipate that automation will wipe out entry-level roles.
During a recent earnings call, CEO Ravi Kumar S stated that the company hired 25,000 fresh graduates in 2025 and expects to surpass that number in 2026.
Hodjat notes that nearly all of Cognizant’s clients have already experimented with AI agents, but many have realized they still need the company’s expertise to properly integrate these tools and achieve meaningful returns.
The report was written by Haripriya Suresh in Mumbai and edited by Janane Venkatraman.
