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Cognizant to invest in AI tools like ChatGPT after firing 3,500 of its staff
Cognizant to invest in AI tools like ChatGPT after firing 3,500 of its staff
The CEO of Cognizant has confirmed that the company will start investing in generative AI. The news comes after the company announced plans to cut 3,500 employees or one per cent of its workforce.
Cognizant is now investing in generative AI tools like ChatGPT, confirmed CEO Ravi Kumar, who succeeded Brian Humphries. The news comes after Cognizant confirmed that it will lay off about 3,500 employees or one per cent of its workforce. Cognizant also confirmed that it would close some office space to reduce costs during the IT sector's difficult times.
According to the Economic Times, Kumar, the new CEO of Cognizant, has said that Cognizant is currently testing a new technology called "generative AI" that can speed up the work of its employees in various areas, such as consulting, design, engineering, and operations. Over time, they hope to double the productivity of their employees by using this technology.
"The tech trend on everyone’s mind is generative AI with recent breakthroughs offering the potential to fundamentally transform our clients’ businesses and increase our own productivity," CEO Ravi Kumar said during the post-earnings call.
Mr Kumar also added that they are investing more in generative AI. They have a process called "AI accelerator" that involves working with clients in special environments to find the most crucial ways to use AI and creating test versions of solutions to test in the field.
"We have conducted ideation sessions with over 30 clients and are now working to industrialize solutions to their common challenges. We believe generative AI will revolutionize the technology services industry, creating higher rates of productivity and driving greater prominence for software and data engineering expertise,” he was quoted by ET as saying.
Layoffs at Cognizant
Just a couple of days ago, Kumar confirmed that the layoffs would take place within the company. He said the impact on employees will be felt across all corporate functions and non-billable overhead. There will be a structural shift in real estate costs, as only 10-15 per cent of the workforce in all Indian companies go to offices, and 30-40 per cent of Indian workers in TI are located in Tier II and III cities and have not returned Kumar feels that it is crucial to create social capital in these cities. The layoffs at Cognizant are occurring as a result of a two-year realignment program.
Cognizant wants to spend $200 million to cover costs related to laying off employees. These costs are primarily for corporate and non-billable staff and are expected to occur primarily in 2023.
