Venkatesh Korla's assertion that customer service has shifted from cost centre to strategic asset reflects a fundamental revaluation happening across enterprise spending, driven by AI's ability to deliver personalised interactions at scale. Where companies once segmented customers into cohorts and staffed accordingly, they now pursue what Korla calls "communication, services and products for each customer at scale"—a shift that reframes support from a necessary expense into a competitive differentiator. This reframing is already visible in how deals are structured: rather than buying 500 FTEs, enterprises now purchase 100 people plus AI agents, compressing initial contract value whilst improving margins. For CX teams already managing this hybrid model, the implication is clear—your role has expanded from operational efficiency to orchestrating human-AI workflows that drive revenue impact. The question becomes whether your current stack (whether Zendesk, Freshdesk, or Salesforce Service Cloud) is architected to measure and optimise for business outcomes rather than traditional metrics like AHT and FCR.
HGS's experience—25% of revenue now AI-influenced despite a 73% profit decline and 2% revenue drop—illustrates the painful transition underway across the BPO sector. Korla's candour about hallucination rates remaining "high enough that humans remain necessary" suggests the industry has moved past the hype cycle into pragmatic deployment, where AI augments rather than replaces. This matters for support leaders evaluating agentic AI platforms: the vendors claiming full automation are likely overselling. What matters instead is whether your platform can surface when human intervention is needed, route intelligently, and preserve context across handoffs. The smaller deal sizes and pressure on traditional BPM spending also signal that procurement patterns are fragmenting—enterprises are no longer buying monolithic outsourcing contracts but rather assembling best-of-breed solutions. For mid-market and enterprise teams, this creates both opportunity and risk: opportunity to build differentiated CX capabilities in-house using modular AI tools, but risk if you're locked into legacy vendor relationships that don't evolve quickly enough to support segmentation-of-one strategies.
Customer service no longer a cost centre in AI era: HGS CEO Venkatesh Korla The Economic Times