Global capability centers (GCC) are playing an increasingly strategic role in 2024 and beyond, evolving from back-office support units into innovation hubs and reinvention engines that drive digital transformation and next generation operations. Multinational companies (MNC) are increasingly realizing that India is the prime location for these centers.
For many years India was seen by the business world as the home of contact center outsourcing, and the world leader in the business process outsourcing (BPO) industry. India's success in outsourcing could be largely attributed to its being able to offer of skilled human resources, cost effectiveness, and broad English language proficiency.
However, times have changed, and so has India. As the contact center and customer experience (CX) space evolved, with omnichannel communications, chatbots, and AI, India recognized the need to pivot from BPO to higher up the value chain to support more knowledge-based work. There is now a significant focus on information and communication technology (ICT), driven by substantial budgets, global behavior trends, frequent expansions, and technology refreshes guided by end-customer compliance.
The rise of India’s GCCs
Global capability centers have become essential elements of modern international business. They are offshore operating centers established by MNCs that carry out a range of strategic functions using local skills and cost arbitrages. GCCs allow MNCs to concentrate on core competencies while leveraging local skills to innovate and generate new ideas.
This includes new products and services or managing IT infrastructure, software development, cybersecurity, and other technology-related functions. GCCs also handle back-office processes like finance, human resources, procurement, and customer support, or be home to regulatory management teams that ensure compliance with legislation and help mitigate risks associated with global operations.
But to cover all these vital business functions, GCCs need to be located in the right place – and that increasingly means India. India can offer MNCs access to a deep talent pool, advanced digital infrastructure, and government policies designed to attract and support MNCs’ operations. It empowers GCCs that are true reinvention engines for MNC business.
It has been a compelling shift, and one that has happened quickly. India’s GCCs transformed rapidly from offering traditional back-office functions into engineering, innovation and R&D hubs, with a mission of creating strategic value for MNCs’ global operations.
By March 2024, the number of GCCs in India had grown to 1,700, generating $64.6 billion in export revenue and employing over 1.9 million people. India’s GCC revenues increased over 40% on the previous year, and by 2030, the market is forecast to grow to a value of $105 billion, with the number of GCCs reaching up to 2,200.
India’s geography is helping drive this growth, with cities like Bangalore, Hyderabad, Chennai, Pune, and the National Capital Region (NCR) all providing the right infrastructure and talent pools MNCs need. Beyond them, second-tier cities are emerging as potential GCC locations too, including Jaipur, Chandigarh, and Coimbatore, which can offer lower costs and untapped talent pools. It all helps drive IMF’s prediction that India will be the world’s third-largest economy by 2027.
New GCC capabilities require end-to-end IT
This more knowledge-based and more progressive environment presents new demands – one of which is the need for a much more holistic, end-to-end IT framework. GCC operators need to be able to offer more than just CX support to MNCs: they must provide business intelligence (BI) services, connectivity, cybersecurity, and cloud, all in addition to core functions like contact center and employee experience (EX) via digital workplace offerings.
The integration of connectivity solutions into India is essential, and domestic integration and professional services are also becoming increasingly important. On-premise contact centers (CC) and unified communications (UC), as well as regional SIP voice services, are critical to supporting these advanced operations.
Cloud and edge infrastructure are also essential to helping GCCs scale rapidly, maintain flexibility, and be able to support distributed teams. Edge computing is critical for undertaking data-intensive tasks closer to end-users and devices, and is essential for applications in IoT, smart manufacturing, and remote monitoring. India’s GCCs are deploying next-generation robotic process automation (RPA) tools to free up human resources from routine, repetitive tasks and allow them GCCs to focus on higher-value activities. RPA is ideally suited to business functions across finance, HR, and supply chains, for example.
Data analytics and BI have a key role, as data-driven insights are essential for GCCs to deliver on MNCs’ global mandates. BI platforms and analytics tools give real-time insights that mean GCCs can track KPIs, optimize processes, and make data-informed strategic decisions that help improve operations continuously.
GCCs can – and indeed should – deploy AI across all these functions to enhance them more than ever and enable better-informed, faster decision-making. AI helps GCCs maximize these technologies and contribute more significantly to business reinvention and innovation. Digital is the essential fuel that is powering India’s GCC evolution: according to IDC’s India Digital Business Survey 2023, around 60% of Indian enterprises’ revenue will be powered by digital business models in the next three years.
The right partner can make all the difference
For MNCs, offering fully-equipped GCC operations in India requires a local partner who can provide an end-to-end, all-encompassing IT offering. Orange Business capabilities in India include connectivity landing into India, domestic integration and professional services, on-premise CC and UC, regional SIP voice, integration services, audit and consulting, digital workplace, bring your own device (BYOD), and co-innovation. It all adds up to the award-winning Orange Business India dedicated GCC division, and positions Orange as the perfect strategic partner for MNCs aiming to shift GCC operations to India and evolve and transform GCCs with a one-stop, end-to-end digital offering.
We also give MNCs access to cloud expertise and cybersecurity from Orange Cyberdefense, plus an unmatched ecosystem of start-ups and innovation consulting options. It positions Orange Business as the perfect strategic partner for MNCs who want to shift GCC operations to India, and to help those already established in the country, to evolve and transform operations and transform GCCs with a one-stop, end-to-end digital offering.
These are exciting times: at the beginning of 2024, around 20% of Forbes 200 global companies have already set up GCCs in India, with some of the world’s leading brands in place. It’s a figure that’s forecast to grow by 50% by 2030. GCCs are now so much more than just sites where MNCs can make cost savings: they’re now at the very forefront of driving enterprise-wide transformation, delivering cutting-edge projects, and innovating new business ideas. India is accelerating.
To read more about how Orange Business India is helping MNCs drive their GCC operations forward in India, please visit: https://www.orange-business.com/en
"Chalapathi is responsible for designing and executing high-growth market strategy for Orange Group in India. Prior to joining Orange Business Services, Chalapathi was Chief Operating Officer with Tata Communications Transformation Services Ltd (TCTS). Chalapathi is an accomplished leader with track record of making key contributions, driving growth and transformations. He has an immense and vast experience in R&D, Technology, Operations ,Sales and Marketing in the Telecom space spanning over three decades Chalapathi holds post-graduate degrees in Engineering from the India Institute of Science (IISc)and in Finance from the Institute of Chartered Financial Analysts of India (ICFAI).
Chalapathi Rao, CEO India Orange Business