Not all AI implementations yield positive ROI: Capgemini CEO Ezzat

Time of India

8 hours ago

Capgemini CEO Aiman Ezzat
Capgemini CEO Aiman Ezzat has taken a measured approach to AI implementation, keeping client experience, cost, and use case at the core of every project. In an interaction with TOI before the WNS deal was announced, he said India remains a strategic hub for Capgemini, which currently has 175,000 employees in the country and is planning a gross addition of 45,000 this year.
Ezzat said that GenAI and Agentic AI represented more than 6% of its bookings in the March quarter. The group has forecast revenue growth of -2% to 2% in constant currency for the 2025 financial year.
To what extent has GenAI influenced your internal software development?
It had some impact—especially when it comes to generating new code, where it performs reasonably well. However, even in those cases, the output still requires review, debugging, and thorough testing. So, while there are productivity gains, they're not as significant as many people assume.
When working with existing codebases or complex environments, the benefits are more limited. We've used GenAI for enhancements, for example, but the productivity improvements weren't as dramatic as some might expect.
There's also a common misconception: increased productivity doesn't automatically translate to cost savings. For instance, a 30% productivity gain among lower-cost roles like testers doesn't have the same financial impact as a similar gain in higher-cost roles such as project managers or functional analysts.
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That nuance often gets overlooked. Beyond productivity, we're equally focused on quality—delivering faster, but with better, more reliable code. So it's not just about cutting costs; multiple factors are driving our approach.
There are discussions around cost overruns with AI implementations. While productivity gains are evident, the operational costs of running AI remain a challenge.
We halted one client's chatbot project—it was going to cost $25 million per year due to data consumption. The financial return just wasn't there. AI solutions need to be evaluated case-by-case.
Not all implementations yield a positive ROI. That said, in many situations, we can find reasonable returns, whether from speed, quality, or other value drivers.
From a broader perspective—on a recent investor call, you mentioned a subdued demand environment. Has anything shifted since then?
Demand remained steady over the past few months. Some industries are seeing growth, while others continue to face pressure. Overall, it's a flat environment. We're not seeing a sharp uptick in activity, but there also haven't been significant cutbacks due to tariffs or other factors.
What remains consistent is the focus on efficiency—cost reduction, productivity gains, and operational optimisation—rather than growth.
Given the uncertain economic outlook and muted growth, companies are prioritising savings over innovation. Most large-scale transformations today are centred around cost optimisation, supply chain improvements, and boosting productivity. When it comes to efficiency and cost focus, there's no major difference.
But in AI adoption—the US typically moves faster and is more aggressive. American companies are often quick to embrace new tech to stay ahead, while European firms tend to be more measured and cautious. That said, it still varies by company, so it's hard to generalise too much.
There's growing momentum around GCCs in India. What's Capgemini's playbook?
It's a natural shift. Clients want more control over key talent areas like tech and shared services, and GCCs offer that. India is a major talent hub, and many clients rely on us to set up, scale, and manage their local operations. We see it as a partnership—GCCs don't replace us; we continue to support clients even after the setup. That's the good news—there's broad recognition that part of global operations, including proprietary work, will be based in India.
It shows how Indian talent is important for in-house roles, and that's a positive shift for both India and firms looking at global partnerships.
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