a 4-minute read by Nivedha Ganeshan, Sales – Customer Engagement, Maveric Systems.
The contemporary landscape of GCCs in India
In the expansive landscape of GCC (Global Capability Centers) market, India boasts a remarkable presence with over 1,700 GCCs and GICs (Global In-house Centers) which operates as IT operations, and Offshore Development Centers (ODCs), accounting for nearly 55% of the GCCs globally.
With the rapid growth of the GCCs in Indian geographies, concentrated on 6 major cities of India (Bengaluru, Delhi NCR, Hyderabad, Chennai, Pune, & Mumbai), a few more are expected to emerge in Tier-2 cities (Ahmedabad, Coimbatore, Kolkata, & Thiruvananthapuram). As the global business setting evolves, by the end of 2023, the number of GCCs in India will elevate to 1790+ and reach 2590+ by 2030, with the rate of 115 new GCCs per year.
Source: NASSCOM, GICs In India: Emerging Centers of Excellence.
A path to progress – Championing change & innovation
Initially, these centers primarily focused on cost-effective, back-office operations such as IT support, finance, and customer service. They leveraged India’s abundant talent pool and lower labor costs to provide significant cost savings for parent companies.
But in the last 3 to 5 years, the GCCs in India have undergone a remarkable evolution from their humble beginnings as low-cost operation centers to now positioning themselves as innovation hubs. Over the years, these centers have invested in nurturing their workforce, emphasizing upskilling and reskilling initiatives to equip employees with emerging technologies and industry trends. This strategic approach has enhanced the team’s technical expertise and encouraged a creative and entrepreneurial mindset, sparking innovative thinking across various functions. This shift of GCCs driven by digital transformation and globalization can be credited to various factors,
- Strong focus on continuous learning and development
- Organization’s commitment to fostering a culture of advancement
- Sustained growth and innovation
- Abundance of talent across domains
- Evolving market dynamics, and
- A stable business environment
These attributes collectively are now making India an appealing destination for MNCs seeking to establish innovation hubs and expand their global business.
The crucibles of innovation undoubtedly bring expected gains, but what do they ask for in return? – Collaboration for accelerated innovation
GCCs in India collaborate closely with their parent companies and other R&D centers to foster knowledge exchange, encourage diverse perspectives, and ignite creativity. Moreover, GCCs frequently partner with other service providers, fintechs, startups, local universities, and research institutions to create an innovation ecosystem.
- A prime example to this is a prominent IT service company has established its Co-Innovation Network that collaborates with startups, universities, and research institutions. Through this program, they partner with external entities to drive research, innovation, and co-creation of solutions.
- Another compelling example is one of the leading global banks joined forces with a fintech innovator specializing in blockchain technology to revolutionize cross-border payments, aimed to significantly improve the efficiency of international transactions within their financial ecosystem.
These partnerships benefit both the parent companies and contribute to the development of local technology landscape and enhancing capabilities in areas like AI (Artificial Intelligence), Automation, Blockchain, Big Data Analytics, IoT (Internet of Things), and Sustainable Banking (ESG – Environmental, Social, and Governance principles).
Recently, the GCCs in India have been reframing their strategies to build solid partnerships and advance their capabilities. These partnerships will enable the GCC player to accelerate the development of innovative solutions and address complex challenges.
The road ahead – Unleashing innovation’s full potential
This impressive growth path highlights India’s role as an emerging focal point for GCCs, underlining its strong and promising future position in this domain. With rapidly evolving technological landscape, innovation is crucial for future-proofing the organization. The GCC’s ability to embrace emerging technologies and adapt to market changes ensures its relevance and sustainability over time. Through continuous efforts to stay ahead of the curve, the GCCs in India are emerging as a dynamic and forward-thinking hub that drives operational efficiency and brings in pioneering technological breakthroughs, making it a significant catalyst for the organization’s future success.
While GCCs demonstrate their potential as innovation hubs, challenges remain to overcome. Data security, intellectual property protection, and talent retention remain critical considerations for GCCs expanding their R&D capabilities. Addressing these challenges requires robust risk management strategies and a commitment to nurturing a conducive and stimulating collaboration environment.
Reshaping the role of GCCs
GCCs will no longer continue to operate as back-office operational centers but fully position themselves to be pivotal in driving innovation and transforming industries. By embracing a collaborative mindset and leveraging the diverse talent at their disposal, companies can unlock the full potential of GCCs as hubs for R&D, securing their place at the forefront of innovation in this digital age.
About the Author
Nivedha Ganeshan has established herself as a skilled Technical Consultant with an impressive 6-year track record. Currently positioned as the member of India NN team, she plays a pivotal role in acquiring new clients and expanding the company’s reach. Nivedha’s expertise is rooted to her background in working closely with global clients paired with strategic thinking and effective communication skills. Her dedication to innovation and ensuring client satisfaction makes her an invaluable contributor to any endeavor.