As artificial intelligence transforms the way businesses operate, TCS is navigating this shift by modernising legacy systems, scaling up internal capabilities, and preparing its workforce for the future. Even as automation gains ground, the company remains confident in its hiring momentum. Attrition, wage expectations, and evolving talent needs remain in focus, with an emphasis on internal growth, clear communication, and operational efficiency. Milind Lakkad, chief human resources officer, in an interview with Urvi Malvania, explains how the company is managing change while maintaining continuity. Excerpts:
Q You added just over 5,000 employees in Q1. While you have said hiring shouldn’t be tied too closely to quarterly business performance, you also noted that the Q1 outcome was shaped by how the business evolved. How do you balance the two?
There are two parts to this. We began the year with certain assumptions about where we would be in Q1, but as the business environment evolved, we had to adjust accordingly. That’s why we are at this number. Some of the hiring is not just for today but also for the future. The talent we bring in needs to be contextualised for our customers, and that takes time. So this is also about getting ready for what lies ahead. You might see headcount fluctuate from one quarter to another, but don’t look at it in isolation. The full year offers a better view.
Q What are you doing to contain attrition, which is currently above your comfort levels? Is there a concern that it could rise if wage hikes are delayed? What internal levers influence your decision on when to implement salary increases?
We focus on three things: providing the right opportunities, creating a positive environment where people feel like part of a team, and ensuring that employees feel heard and valued. If we do these consistently, people tend to stay. This is not a one-time project, it’s a continuous effort. It’s not accurate to say there won’t be consequences if we don’t act on wage hikes. Yes, there could be implications. But open communication matters. At the same time, we need to keep performance strong so that we are in a position to respond quickly and take the right steps for our people. It’s always a balancing act across multiple stakeholders. Growth is important. We must run operations efficiently to maintain benchmark profitability. Once the demand environment stabilises, which is very volatile at the moment, we will take a decision.
Q What’s your assessment of how AI is changing the nature of work at TCS? Why do you believe hiring won’t be impacted despite rising automation?
AI for business reimagination is an opportunity. There’s already some new pipeline coming in. Clients are moving beyond proof of concept as they are looking for tangible returns and setting up AI centres of excellence. We are supporting them in that journey. There are also opportunities that didn’t exist earlier, such as legacy modernisation. Some green shoots are already visible. Earlier, a job might cost X dollars. Today, it can be done for 0.6 or 0.7X. But now there are five or ten such jobs, which were not even feasible earlier. The nature of work will change. Human-plus-AI interaction will become the norm. This will lead to better productivity, simpler execution of complex tasks, and more overall work. That’s why I believe hiring won’t decline, at least in the short term.
Q Do you expect humans to play more of a governance role while automation handles repetitive tasks? How are you preparing teams for this transformation?
That is part of the shift, but it goes deeper. It’s about reimagining how technology is used in context like changing business models, and how we develop and test software. From rethinking the software development life cycle to generating new business ideas, all of that still needs human involvement. The human-in-the-loop is critical. It’s a continuous feedback loop, like taking action, observing the output, and refining it. It’s similar to how we work with Gen AI prompts. Our learning ecosystem must align with this change. We are building a pyramid of AI skills, from beginners to experts, and using AI internally as well, for scaling, recruitment, talent engagement, and development.
Q Is the growing demand for AI and data talent leading to increased pay competitiveness in the market?
We do pay what is necessary to hire the best talent. But we also focus on internal talent development. Our pyramid model balances external hiring with internal growth, and we aim to do this at an optimised cost.
Q In a challenging business environment, how are you strategising hiring, from campuses and the market?
It’s always a balancing act. But one thing is certain, we will honour all the offers we have made on campuses. The only variable is how many we bring in each quarter, depending on the business situation. We stay in constant touch with candidates to ensure there are no surprises. Market hiring will be driven by product demand. Many will be hired for new opportunities, and some will fill existing roles as well.