It has been an exciting development for the GCCs over the last few years. In the (not too distant) past, multinational corporations used to look at their offshore captives to contain costs for monotonous, low-value business processes. From there, we saw shared services centers becoming heavy contributors in the day-to-day business operations of their MNC counterparts, alongside developing centers for research, development, innovation, and business transformation. Captives transformed into Global Capability Centers, wherein new skills and competencies could be swiftly nurtured and scaled.
As multinational corporations continue to move to the innovation-led digitalization paradigm, they are looking at their GCCs in India to drive the digital transformation agenda. The last few years have witnessed an entirely new set of organizations setting up GCCs in India while traditional firms across sectors revamp their strategy to reimagine their future in the digital age. While India has provided a seamless platform for GCCs that leverages quality talent and capabilities in the country, GCCs have also contributed significantly in return. India I now home to 1430+ (FY21) GCCs and employs over 1.38 million people (FY21) in India and is estimated to generate revenues of ~$35.9 Bn by 2021. GCCs have also established resilience in the wake of the pandemic, which ensured business continuity as well as business excellence to a great extent.
GCCs in India – a pillar of strength
GCCs have now become a crucial pillar in strengthening the Indian economy thereby contributing back to society by creating a high-quality workforce on technologies such as AI, ML, AR/VR, etc. GCCs are also focused on expanding and creating new Technology Centers of Excellence (Tech CoEs), focusing on innovation, technology enablement, and enriched service portfolio to drive the digital transformation agenda.
However, the fundamental question remains: Will these upward GCC growth trends remain five years down the line? I would say, yes. We are likely to see these trends in the upcoming years as well. Based on our analysis, GCCs are growing faster in India in terms of revenue attribution – GCCs in India will likely grow to a USD 58-61 Bn market by FY2025 and India will likely have 1900-2000+ GCCs. India will also have an estimated direct GCC employment of 1.8-2 Mn+ in FY2025. There is no denying the fact that India continues to attract MNCs to tap into its rich and diverse ecosystem being one of the fastest-growing economies in the world. GCCs in India is surely an interesting area to explore more.
GCCs in India have explored multiple opportunities for innovation and growth through various technology-led digitalization efforts – from exploring newer operating models to finding the right balance across magnitudes of people, technology, cost, and partnerships, to focusing on innovation – both internally and externally. India GCCs have paved their paths to future-proof themselves against interruptions and to redefine, realign, reboot, and reimagine their global organizations to thrive in the new normal.
Immediate Priorities to Augment the Growth
Let us take a quick look at the immediate priorities to further augment the growth of GCCs in India.
While the GCC Ecosystem in India has matured over time, there is still tremendous headroom for their growth in India in the coming years.
Key themes driving the GCC ecosystem
With GCCs thriving in the country, business leaders in this sector are expected to push the frontiers of technology and build the trust in with their parent organizations to rapidly scale GCCs in the immediate future. NASSCOM, in collaboration with Zinnov Consulting, has recently launched a report titled, “GCC India Landscape – 2021 and beyond!.” The report aims to highlight the facts, trends, and insights on India GCC landscape, digital transformation/ innovation, ecosystem development, experimentation, and way forward for GCCs. The report is structured around five key themes that define the journey of GCCs in India and talk through how the GCCs have been adding value to their parent organizations vis-à-vis contributing to the Indian ecosystem, along with a projected way forward section.
A quick snapshot of GCCs in India in 2021:
For more details, download our recent GCC report, “GCC India Landscape – 2021 & Beyond!” here
Read my previous blog, Global Capability Centers (GCCs) in India – Reimagine the Future