This brief is part of the Insights @ Center for Emerging Markets, a publication focused on cutting-edge ideas and advice for global leaders about emerging markets.
By Kathryn Slomski (Northeastern University)
In Short: Frank D'Souza co-founded Cognizant in 1994 and served as its CEO from 2007 to 2019, building it into a Fortune 200 information technology services giant. He is currently co-founder and Managing Partner of Recognize, a private equity fund focused on technology services. This note is based on D'Souza fireside chat with CEM Director Ravi Ramamurti in October 2025 as part of the Center's Vivek & Vandana Sharma India Lecture Series. D'Souza's topic was “Can India compete in AI and Related Technologies?”. His core message: AI will disrupt Indian IT companies profoundly, but out of the “creative destruction” that follows could emerge Indian companies (existing and new) that not only survive but thrive… provided they understand where and how to compete.
A 1990s-Scale Disruption
D'Souza draws a direct parallel between today's AI moment and the offshoring revolution of the 1990s. In that earlier era, the convergence of low-cost bandwidth and collaboration technologies allowed digital work to flow seamlessly across borders for the first time. India had a large pool of software talent, and when bandwidth became cheap, that talent could suddenly serve global demand. Companies like Cognizant emerged to capitalize on this shift, fundamentally disrupting the services industry.
Now, AI is going to disrupt the IT services industry. The question is whether today's Indian technology firms, which boomed during the offshoring era, are ready to be at the receiving end of disruption.
The Incumbent's Challenge
D'Souza's assessment reveals the depth of the challenge facing established firms in today's tech environment. The innovator's dilemma makes it structurally difficult for successful incumbents to transform their business models, even when they clearly see disruption approaching. Recent layoff announcements from large firms like Accenture and Tata Consultancy Services serve as early warning signals.
Yet D'Souza is optimistic that AI will boost innovation globally, including in India. Insurgent companies are emerging across geographies, though few have reached scale. The opportunity exists for both new entrants and incumbents willing to fundamentally reinvent themselves, but the window is narrow, and history suggests most will miss it.
India's Comparative Advantages
D'Souza believes that India's competitive position differs fundamentally from the 1990s opportunity. The country lacks access to the massive capital required for AI infrastructure: the GPUs, power capacity, and networking being built at unprecedented scale in the United States. China is becoming increasingly competitive at building foundational models and core AI infrastructure, as evidenced by developments like DeepSeek.
But India has genuine advantages, particularly at the inference level, at the top of the stack where AI meets specific industry problems. This application layer leverages India's traditional strengths in applying technology rather than building underlying infrastructure. Additionally, India's massive, digitally enabled population creates potential advantages in data, a critical input for AI systems that could prove decisive in certain applications.
For emerging economies beyond India and China, D'Souza emphasizes that the biggest opportunity isn't building foundation models either. Applying AI across traditional sectors, such as manufacturing and agriculture, could boost GDP by 35-40% in these countries. This application opportunity requires less capital than infrastructure development while potentially delivering broader economic benefits. Indeed, that may be where real value can be unleashed by AI.
How Firms and Individuals Must Adapt
Successfully competing in the age of AI requires transformation at both organizational and individual levels. For companies, D'Souza points to culture as Cognizant's defining competitive advantage. The firm built a team focused relentlessly on adaptation, where continuing yesterday's approach felt uncomfortable. This cultural foundation created organizational capacity for continuous learning and change, capabilities that D'Souza believes matter more than any specific technical skill as the landscape shifts rapidly beneath incumbents' feet.
For individuals, the imperative is equally profound. D'Souza acknowledges that millions of service workers in India face disruption, yet he sees reason for optimism. The world will almost certainly become more technology-intensive over the next two decades, requiring human effort to implement and maintain that complexity. He believes that technology intensity will not just come from some smart machine, but humans in entirely new categories of jobs. Today's workers may need to reinvent themselves two or three times during their careers. Those who double down on core capabilities like critical thinking, empathy, adaptability, and commit to lifelong learning will find their place in this new landscape—especially if they pair these with domain expertise and AI fluency.
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If you are interested in learning more about this work, contact Kathryn Slomski.
