Regional IT centres can transition into AI watchdogs for IT services companies as India’s tech giants re-evaluate small offices in the AI era, as per experts.

As IT companies hold off on mass hiring and shave off headcount numbers from the middle, industry leaders like Tata Consultancy Services’ (TCS) Chairman N. Chandrasekaran talk about re-evaluating “sub-optimal centres,” that have become “very difficult” to manage.

While this can lead to a consolidation of small local offices into larger centres, analysts view this as a possible repositioning of the satellite offices to take up AI governance especially for mission critical tasks that cannot be left in the hands of AI agents.

“Agents do not supervise themselves. The more the firm automates, the more it will need small, expert, high-trust nodes whose purpose is to govern what the machines produce. So, the small centre does not vanish in the AI age.

It inverts, from a cheap-labour container into an expensive-control cell,” said Sanchit Vir Gogia, Chief Analyst and Founder of Greyhound Research. In TCS’s case, this is proved by how the company began specialised AI capability centres in the same week it questioned generic ones.

Similarly, the satellite centres can become specialised talent hubs for other areas like data engineering, cybersecurity, cloud technologies, product engineering, and domain-specific services. They can also serve as centres for innovation, rapid prototyping, and AI-assisted delivery rather than merely execution-oriented work, as per CIEL HR, talent solutions platform.

“The industry will have highly skilled professionals who can work alongside AI systems, solve complex business problems, and create differentiated value for clients. The future of these centres is therefore more about specialisation, productivity, and the quality of talent they attract and develop,” said Aditya Narayan Mishra, Managing Director and CEO, CIEL HR.

The ground reality

Another consequence of the re-evaluation is how the hiring demand will further concentrate towards the AI-literate, the domain-aware and those who can question a machine’s answer rather than merely produce one. This makes it harder for a Tier-2 student to enter the workforce, who may not have the access to such learning.

“Too few early-career employees can count on structured managerial backing to build genuinely new skills, and small-town talent depends on that employer-led scaffolding more than most, having fewer alternatives around it. If firms recruit fewer people while expecting more AI fluency on day one, the burden shifts back onto colleges, state skilling efforts and the aspirants themselves,” said Gogia.

Incidentally, NASCCOM Chairman Srikanth Vemalakanni also advised students to prepare for the AI race by building and releasing AI systems for first-hand experience and creating a more impressive portfolio, during the launch of Plaksha university’s Masters in AI course

The headcount hit

According to Instahyre solution platforms, large IT services firms increasingly prefer consolidating 100–200 person satellite offices into larger regional hubs for better governance, economies of scale, and AI-driven workspace consolidation. Infosys, HCL Tech, and Wipro have already been consolidating and slowing Tier-2/3 expansion.

Even conservative estimates of 50-100 small centres in the country, this new trend can impact 7,500-15,000 employees per IT services firm, as per Sarbojit Mallick, co-founder, Instahyre.

“From a business perspective, the logic is understandable. At the 2026 AGM, Chandrasekaran said TCS could have as many AI agents as employees within three years, reflecting a shift from measuring success by headcount growth to measuring productivity. If AI enables a 200-person team to deliver work previously requiring 350–400 people, companies will naturally reassess whether maintaining numerous small centres remains efficient, especially as AI components are expected to account for around 100 per cent of revenues by 2028-2030 and TCS is becoming ‘more selective of top talent’ rather than mass hiring,” said Mallick.

Published on June 14, 2026