Global in-house centres: Can employees see new organisational normal in 2021 and beyond?

November 3, 2020 1:14 PM

Almost all the GICs made a concerted effort to ensure that all their employees had the necessary IT infra support to operate virtually.

work from home, wfh, tax implications, salary,Because of work from home and travel restrictions, there was no expenditure incurred on account of conveyance or leave travel and hence such allowances would now form part of taxable income.

Anandorup Ghose, Vamsi Karavadi

The current pandemic has had a significant impact across the industries not only in India but globally as well. Organizations have had to deal with a significant amount of uncertainty on their revenues, which has led to a renewed focus on conserving cash and managing costs more effectively. This in effect is the fundamental value proposition for the Global In-house Captives (GICs). India is home to over 1500 GICs across sectors. The agility that they have displayed since the early days of lockdown, equally supported by the government’s policy changes has enabled them to operate virtually without skipping a beat. This has enabled them to emerge as a key driver of the overall organizational goals, cementing their strategic importance and impact as part of the global ecosystem.

Since the lockdown, we have witnessed some key changes in the way of working of the GICs. Centers introduced a work from home policy to enable people to operate virtually, and centers that already had existing policies in place have strengthened the same by providing additional support. Almost all the GICs made a concerted effort to ensure that all their employees had the necessary IT infra support to operate virtually. This enabled almost 90% or more of the employees to be active within the first month of the lockdown.

There was increased adoption of the technological solutions which would enable greater collaboration amongst the employees. Almost all the GICs have reported that employees really did step up in their respective roles and delivered as per the organizations expectations in these uncertain times. Almost all the GICs agree that the personal productivity of the employees has not suffered during this period. The success of virtual working has even led a lot of organizations to renew their focus on engaging non-traditional sources of talent; like the gig workers, freelancers, and has also strengthened their ability to drive diversity in their workforce, by bringing on board returning mothers, and tapping into talent from other locations.

The success of the virtual operating model was supported by a fundamental shift in the human resource paradigms of the GICs. GICs had to re-examine their entire HR policies and the benefits being offered to aid in a smooth transition and sustained operations. A formal work from the policy was introduced along with defined allowances and perks for setting up a virtual office at home. Additional investments were made in procuring the latest technologies to help drive collaboration and seamless virtual operations. GICs started leveraging technologies to digitize their entire HR ecosystem to provide a more seamless employee experience; with virtual recruitment, onboarding, helpdesk, and continuous support channels. Organizations also re-examined their benefits policies to strengthen the healthcare support they were providing their employees.

Employees historically were predominantly focused on the cash aspect of total rewards. But the current pandemic has highlighted the importance of a good healthcare benefit, expectations of the employees are changing as well as their appreciation of these non-monetary benefits is increasing. GICs have enhanced the health benefits being provided to their employees during this pandemic; by increasing the coverage, providing COVID-specific support, and also partnering with healthcare service providers to provide regular health checkups and counselling online. They are also supporting the employees through this extended lockdown period, with physical and mental wellness initiatives.

The resilience displayed by GICs has definitely propelled them into emerging as a key talent hub to deliver on the global initiatives, which has also led to more high-value services being moved into the GICs. This coupled with the increased focus on automation has presented a unique dichotomy for the GICs. They have responded to the same, with a renewed focus on training and upskilling their employees. There has been an increased investment in providing employees with learning avenues and content to help them expand their skill sets, thereby enabling them to contribute more effectively to the larger organizational transformation.

While there have been a lot of pros, there are some new emerging risks that the GICs will have to deal with like data privacy, cybersecurity, and also employee wellness. GICs are responding by re-inventing their operating model to leverage all the resources at their disposal to enhance productivity and also manage the associated risks. These operating models are fairly agile and are evolving rapidly. Studying the impact of these changes; seeking feedback from all stakeholders and responding rapidly would be critical for the success of GICs as they undergo this transformation.

Anandorup Ghose is Partner and Vamsi Karavadi is Director at Deloitte India. Views expressed are the authors’ personal. 

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