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Genpact: Genpact will book ‘record deals’ in first two quarters of FY23, says CEO NV Tyagarajan

The trend of large contracts coming up for bidding, which accelerated in the December quarter, continued and led Genpact to book “record deals” in the first two quarters of 2023, NV (Tiger) Tyagarajan, chief executive at the US-headquartered business process management firm, told ET.

The London-based executive said the company’s data-tech-artificial intelligence segment, which accounts for 45% of total revenue, will make up half of its revenue by 2026. Almost 100% of Genpact’s client conversations in the last few months have been converted into engagements where generative AI (GenAI) is being used in their regular operations, he added.

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The record deals are a “unique opportunity” yet cost reduction remains an important agenda for clients, he said.

“There doesn’t seem to be much worry about recession than before but the interest rates, mortgage rates and energy bills have gone up. Therefore, all the leadership teams (of clients) are focussing on cost,” he said.

Focus on GenAI

He said application of genAI which involves customer-engagement — be it involved in sales, helpdesk, collection or services — is a top use case of the emerging technology.

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“Everyone is talking about GenAI and how to use it … we have about a 100 proof of concepts going on. When we launched our internal hackathon in April, we had around 9,000 ideas,” he added.The addressable market for the IT sector is set to increase, as the development of over 100 new GenAI use cases could bring an additional 15-20% growth, as providers reimagine existing offerings or come up with new ones over the next five years, as per a report by Nasscom and McKinsey & Company.

Industry bellwether Accenture Plc bagged $100 million worth of deals in GenAI themes over the past four months, the company said during its third quarter analyst call in June.

When asked about regulations in AI, Tyagarajan said most companies are approaching the topic in a “highly responsible way” focusing on traceability of decision making and data security because of the long-term implications. “There is a high degree of focus and compliance lens is being applied by boards, tech organisations and C-suite…But self regulation, responsible approach and ethical approach to business is always the best answer,” he added.

Large deals

In December, Tyagarajan had said around two-thirds of deal conversations with clients were related to reducing costs amid macroeconomic uncertainties, which was a complete contrast to the situation in the last three years when the pandemic happened.

Over the past few weeks, domestic IT firms have also been winning sizable deals as companies are focusing on large scale cost-cutting programmes and monetisation of non-core assets.

Among the leading IT players, Infosys signed a $1.6 billion AI and cloud-themed deal for an initial five-year engagement with telecom and communications group Liberty Global in August. The value of the contract could go up to $2.5 billion and, if extended to eight years, this could be one of the largest deals signed by Infosys in its four-decade history. Earlier this month, Tata Consultancy Services bagged a $1 billion, five-year deal from the digital unit of another Tata Group firm, Jaguar Land Rover.

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