The adoption of Large Language Models (LLMs) has significantly increased the volume of work that can be accomplished, leading to a substantial reduction in cost per transaction or unit of work. This decrease is estimated to be between 25-30%, Madhusudan Hegde, EVP & BPS Business Unit Head at Coforge BPS (business process solutions) told FE.
Furter, Coforge is actively shifting towards an outcome-based model, which moves beyond traditional task automation to complete case resolution. This transition is driven by AI, which enhances business outcomes beyond the conventional cost reduction of 30-40%.
Hegde said: “The shift from task automation to case resolution is due to AI – which enables us to deliver business outcomes. It’s not just about 30-40% reduction in costs; efficiency is a given, but it’s about business effectiveness and experience.”
Coforge is also leveraging agentic AI (artificial intelligence) and building its technology stack on specialised small language models (SLMs). This approach enables deeper domain-specific solutions tailored to individual clients.
“Deep domain is necessary to differentiate and build client-specific solutions. With our approach as an AI-first firm, we have been able to penetrate newer verticals like healthcare and retail beyond our banking, insurance, and travel sectors,” Hegde explained.
This transition is also expected to redefine the BPS industry by moving away from traditional automation methods towards AI-driven processes that enhance efficiency and productivity.
“We see AI not just as freeing up human capacity; we see it as a capacity enabler. And actually it takes the average up for our people. So we become a performance enhancer,” he said.
Breaking the Traditional Headcount-Workload Curve
Traditionally, revenue growth in the BPS sector was directly proportional to headcount growth. However, AI has broken this linear relationship, allowing firms to scale operations without an equivalent increase in workforce size.
“I see AI giving—this is the whole point where I think non-linearity of revenue with headcount is the future. I think human beings are still going to be important. It is about capability enhancement and driving performance. But I think that the curve has been broken,” Hegde said.
Additionally, the company is also actively expanding its Global Capability Centres (GCCs). “We’ve actually set up GCC for a large firm in Hyderabad, maybe scaled to about 500 people in less than three months. The plan is to get them to about a thousand more in the next few months from the standpoint,” Hegde said.