CIOInsider India Magazine
India Leads Mid-Market AI Push Amid Rising Complexity Costs
Freshworks Inc. released The Global Cost of Complexity Report: The Mid-Market AI Complexity Trap, featuring a detailed examination of how AI complexity is affecting mid-market companies in India.
The research, based on responses from over 9,000 mid-market IT decision-makers across six countries, finds that in India, 27percent of the average mid-market AI budget is lost to complexity overhead, contributing to an estimated Rs. 33,000 crore in wasted AI spend every year.
Despite this “complexity tax," Indian mid-market companies remain bullish on AI. Ninety-four per cent report a growth outlook for the next 12 months, and 94percent plan to increase AI investment over the next 12–24 months.
At the same time, IT leaders are under intense pressure to deliver: 74percent of Indian executives expect AI investments to show ROI within eight months, yet 51percent say AI deployments alone take 6–12 months just to go live, creating a sharp gap between expectations and execution timelines.
Srinivasan Raghavan, chief product officer at Freshworks says, "Mid-market IT leaders don't have time for AI that takes months to deliver value. They need AI that works inside the business they already run and shows value fast. The companies that move from purchase to performance fastest will turn AI from a complexity tax into a competitive advantage.”
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Mid market AI programs are stalling in the gap between executive expectation and deployment reality.
Globally, 72percent of mid-market executives expect AI investments to show ROI within eight months, and in India that figure is 74percent. At the same time, 55percent of organizations say deployment alone takes between 6 and 12 months before meaningful ROI can even begin, with just over half (51percent) of Indian organizations reporting similar deployment timelines.
Middle-market businesses tend not to be early innovators and often lag in realizing full-scale implementation benefits until they are confident of ROI. Until then, smaller pilots and tests are often used to prove feasibility
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Indian mid market organizations report the same pattern, with system integration complexity (34percent), skilled talent shortages (30percent), and excessive configuration requirements (31percent) all cited as leading barriers. With deployment timelines running longer than the windows executives are watching, programs risk being cut before they can deliver value.
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"Middle-market businesses tend not to be early innovators and often lag in realizing full-scale implementation benefits until they are confident of ROI. Until then, smaller pilots and tests are often used to prove feasibility," says Doug Farren, executive director, National Center for the Middle Market.
