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AI Disruption: Reshaping Outsourcing, Industries, and the Future of Work

Explore how AI is transforming IT services, reshaping industries, and redefining global job markets and business models.

Author

Malcolm Frank, CEO
February 17, 2025

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Physician, heal thyself  

IT Services leaders love to talk about new tech. Visit the websites of Accenture, Deloitte, or Infosys, and it’s as if their marketers are paid by how often they can use terms like AI, transformation, and new economy.  

But which industry may be most ripe for AI-driven revolution?  Theirs.  

These companies are massive and indispensable. The top ten IT Services firms collectively employ over three million people, and their work touches your life constantly—whether you're booking a flight, withdrawing cash from an ATM, or using Google or Apple Maps.

Yet GenAI is starting to eat work that has these key characteristics: human-centric, process-oriented, or knowledge-based. It’s almost all these firms do.  

This week, two of the sharpest voices in the industry examine this unfolding transformation:

  • Andreessen Horowitz highlights how $300 billion is suddenly in play as AI-driven agents gain traction.

  • Horses for Sources predicts that the traditional "service by humans" model will evolve into "Service as Software," unlocking a new $1.5 trillion market.

My old space will soon be turned upside down, and, for once, will become an exemplar of innovation instead of talking about it.

Unbundling the BPO: How AI will disrupt outsourced work

Andreessen Horowitz on the massive impact agents will have on the $300 billion industry. 

Services-as-Software presents a $1.5 trillion opportunity for both software and services firms

Phil Fersht of HFS has coined the new “SaaS,” and outlines how AI will radically reshape IT services.

AI coding could be Indian IT engineers’ biggest threat

Could AI impact India’s engineers disproportionately? An interesting analysis.

Paris AI action summit: "Don't miss out" replaces "doom is nigh"

Summit aimed to tackle AI's dangers — from job losses to climate impacts — but unlike two predecessor events, it largely celebrated AI's tantalizing potential benefits.

How AI will divide the best from the rest

Optimists hope the technology will be a great equalizer. Instead, it looks likely to widen social divides.

Reddit starts to lose users; is it due to AI?

Fears that “the scorpion finally bit the toad.”

Are China’s AI advancements a double-edged sword hanging over already dire job prospects?

Fears of AI-driven unemployment hit China, with particular concern for younger workers.

IBM return-to-office order hits finance, ops teams amid push to dump staff for AI

RTO picks up new momentum. Some see the reason as "AI will be implemented to replace people."

Agent of the Week: Ada

AI customer service to accelerate your business.

A new job ad seeks to hire agent at $15K per year

“Please apply only if you are an AI agent, or if you created an AI agent that can fill this job,” the job posting read. 

From enabling to disruptive: How GenAI is impacting company culture at IT service firms

The age-old pyramid business model is suddenly under pressure. 

OpenAI CEO Sam Altman: How I use AI in my own everyday life; “It’s great for boring tasks.” 

“Process all of my email” or “Summarize this document.”

AI agents are everywhere…and nowhere

Vendors like OpenAI and Microsoft are banking on business readiness to use autonomous AI bots, but companies aren’t so sure.

Bain study: For marketers, GenAI moves from novelty to necessity

Companies that scale up their initiatives will gain an edge by delivering consistent value and better engaging customers.

Microsoft: AI to transform wealth management

“AI's ability to condense financial data will allow just a few people to offer services that previously occupied entire teams in a bank.”

And one more thing…

The Getty Museum acquires its first AI photograph

Creating transgressive art without endangering real people.

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