World’s top companies are realizing AI benefits. That’s changing the way they engage Indian IT firms

Global Leaders Transform Outsourcing Strategies as AI Revolutionizes Indian IT Sector

The world’s leading corporations are increasingly harnessing the power of artificial intelligence, prompting a significant shift in their engagement models with Indian IT service providers. Traditionally reliant on fixed-price contracts, these multinational companies are now exploring more flexible, outcome-driven arrangements.

This evolving trend signifies AI’s profound impact on India’s $280 billion IT services industry. As automation and intelligent solutions accelerate project execution, companies are re-evaluating their outsourcing approaches—shifting focus from extensive human labor to efficiency, speed, and agility.

Many Fortune 500 firms are now contemplating time-and-material (T&M) contracts. These agreements base payment on the actual time and resources utilized, offering greater transparency and adaptability. Such a move indicates a broader paradigm shift, where value delivery is prioritized over cost estimation, driven by the transformative potential of AI technologies.

As the Indian IT landscape adapts to these changes, both service providers and clients are recognizing the importance of embracing innovative models to remain competitive amid this new era of technological advancement.