CA Pruthvi Maurya

BCG Report: IT Firms Lack AI Talent to Capture $200B Opportunity (a) BCG evaluated 50,000 engineer profiles (b) Only 10% doing Applied AI work at IT firms (c) Urgent need to build Applied AI workforce (d) INSIGHTS for IT engineers:. Market Is Ready; IT Firms Aren’t a. Boston Consulting Group (BCG) has published an extensive report on how IT companies can build Applied AI workforce from the people they already employ. b. Opportunity: BCG estimates in the next 4 years AI will add $400B of new revenue streams for IT services globally, but wipe out $200B of old revenue streams. So, the net gain is $400-$200 = $200B. c. Problem: IT firms claim to offer “AI-first” services, but in reality they have not built an AI delivery model. These companies only have a fraction of talent needed to capture the vast opportunity. d. IT companies tag their workforce as “AI engineers,” but in reality only 10-15% do Applied AI work. The rest merely use AI to do old work faster. At AI-native firms (“tech companies”) 90-95% do real Applied AI work. Infused AI vs. Applied AI a. Infused AI: It uses AI tools to do existing work faster. An IT engineer’s task is still fundamentally software development, which is now done faster with AI tools. b. Applied AI: It involves building and operating AI agents that do the work. Examples: enterprise AI agents, agentic workflow automation, production AI platforms, and AI systems for end-to-end business processes. c. Infused AI eliminates the need of humans for repetitive tasks. If previously 3 engineers worked for 8 hours to develop and test a feature, now only 1 engineer can do the same task. So, two-third of the workforce is gone. d. Applied AI engineers create new sources of growth & revenue for clients by building and operating AI agents: new services, new products, new customer problems that can be solved economically, and new ways to increase productivity. e. IT companies lack the capacity in Applied AI. BCG says time is running out, and market opportunity will be grabbed by firms that move fast to build massive “Applied AI” talent. Applied AI Job Roles BCG has identified 40 distinct Applied AI roles. Four categories, which IT engineers and IT firms should target are: a. Forward-Deployed Engineer (FDE): Works closely with the client to design & deliver a working solution. b. AI Engineer/AI Architect: Builds and scales enterprise AI and agentic systems. c. Semantic Engineer: Develops data representations, vector embeddings, and knowledge structures that AI agents can use. d. AI Ops Engineer: Monitors AI systems for performance, accuracy, drift, and bias. In AI-native firms, 45% of the workforce comprises forward-deployed engineers (FDEs). In traditional IT firms, the share is less than 5%. 5 Questions IT Firms Must Answer BCG wants IT companies to answer these five questions right now: a. Has the company selected the AI use cases (agentic systems) it intends to build to solve client problems? Otherwise it may train people in general AI skills without knowing where those skills will be used. b. Is there consistent role architecture across the company? A common architecture makes job roles, skill requirements, and career paths easier to compare across teams. c. Has the company made deliberate hiring and training decisions for all 40 Applied AI roles? A blanket hiring and training policy won’t sustain for long. d. Has the company assessed its existing workforce properly? Accurate assessment prevents the company from overestimating or underestimating its current capabilities. e. Can the company’s pay and career structures survive competition from AI-native firms? Otherwise the company will lose existing talent or fail to attract top talent. Endpiece: The Clock Is Ticking BCG report’s final message is that building AI capability takes time. Winners will be those IT firms that begin early and enable their employees to develop skills and experience before the opportunity matures toward 2030.

Markets Will Give One Golden Exit (a) Markets are perverse; they exist to trap people (b) Black Swan Nassim Taleb: Mkts at most fragile point in 20 yrs (c) JPM: Indian large caps world’s most liquid hedge as AI risks rise (d) What should investors do? India: World’s Largest AI Hedge a. Size & Liquidity: JP Morgan says Indian large caps are emerging as the world’s largest liquid “AI hedge,” as global AI trade risks rise. With India’s high domestic liquidity (SIP inflows), FIIs can exit or enter the market without distorting prices. No other non-AI market offers this liquidity & scale. b. AI Concentration Risks: In the first half of 2026, JP Morgan and others had downgraded India to Neutral due to booming AI & semiconductor trade. Now that narrative is getting slightly diluted as global investors seek some hedge & diversification against potential AI bust. The Mother of All Bubbles a. Universa founder Mark Spitznagel is the ultimate black swan investor and a protégé (disciple) of Nassim Taleb (author of Black Swan). Taleb is the “Distinguished Scientist” at Universa. b. Black Swan Events: Universa made billions for investors during 2008 and 2020 crashes, but it is not a perma-bear. It has been extremely bullish for the last 4 years, making money on the way up as AI bubble inflates. c. Face-Ripping Rally Ahead: Universa says bears like Michael Burry are right about the coming AI bust, but they are going to get the timing wrong. “There is still one more really insane rally to come across equities.” d. Greatest Bubble in History: In Jan 2026, Universa wrote to its investors that we are witnessing the “greatest bubble in human history.” This bubble arose from years of zero-interest rate policies and unlimited Fed money printing. The bubble is “now in the final stages, unfolding right on schedule as data shows. It will end in a historic bust that is logically to follow.” What Should Retail Investors Do? Sophisticated hedge funds like Universa play both boom & bust. Their annualized returns to investors from 2021 to 2026 are above 100%. Copying their playbook is tough for individual investors. The best thing you can do is: a. Exit partially while market is still giving you a chance, and diversify into fixed income & gold. OR: Sell mid/small caps and move into high quality large caps to bullet-proof your portfolio. Same also applies to MF/SIP schemes. b. Corporate Governance Risks: Every mid/smallcap company now claims they are defence & engineering specialists. When the tide goes out, you will know who all were swimming naked. c. IPOs are falsely inflated to give exit to private equity. Avoid them even if they are excellent companies. They will lose 50% when a crash occurs. d. Due to leverage, many small/midcaps will become available at liquidation values when there is blood on the streets. That’s when you enter them. (Tip from: Oct 12 concall of Nimesh Shah, MD, ICICI Pru AMC) Endquote: Thanksgiving Is Coming “A turkey is fed by the farmer every day. With every single feeding, the bird becomes increasingly confident and fat. On the day before Thanksgiving, something “unexpected” will happen to the turkey. It will lead to a revision of belief.” “The feeling of safety peaks when the risk is at the highest.” – Dr. Nassem Taleb, The Black Swan @arabicatrader