By Ayushman Baruah
With multinational companies planning to expand their global capability centres (GCCs) in India, the number of such captive units is likely to go up to 2,000 in the next 3-4 years, from the current 1,500 according to estimates drawn up by analysts.
GCCs, also known as global in-house centres or captives, emerged in the early 1990s as offshore units of large multinationals such as General Electric, Texas Instruments, Citigroup and American Express to perform designated technology operations. The 1,500 GCCs, currently operating in India, employ close to 1.4 million people, according to Nasscom.
Consulting firm ANSR is aiming to set up 100 GCCs in the country over the next 3-4 years. “Apart from the large banks and retail chains and CPG (consumer packaged goods) companies in the US, a lot of companies in the mid-market segment, startups and product companies from markets such as Eastern Europe, South East Asia, Middle East are also making a beeline to India. We are seeing traction in the retail/CPG, BFSI (banking, financial services and insurance), healthcare, and travel and logistics sectors,” said Lalit Ahuja, founder and CEO, ANSR.
While cost arbitrage was the key driver for enterprises to set up GCCs in India in the early 2000s, over the years, these have evolved into strategic assets providing significant competitive advantage to companies.
“Omnichannel, mobile, cloud, digital, information security, etc are no longer optional capabilities but essential for companies to stay relevant. The Covid-19 pandemic has accelerated digitalisation and assuaged concerns around distributed work models, giving these companies more confidence to set up their technology hubs in India,” said Ahuja.
American retail giant Lowe’s Companies opened its second GCC in Bengaluru in April. Together with Lowe’s existing office, the new facility in Bengaluru’s central business district provides approximately 14,000 square feet of additional space to support its growing workforce.
Lowe’s workforce in India has grown 60% amid the pandemic to over 3,800 people. “The continued expansion of our India operations will help teams grow across unique capabilities such as artificial intelligence (AI), machine learning (ML), product management, merchandising, supply chain, engineering, analytics, and other functions. The workforce at our Bengaluru facilities will continue to grow and support the business transformation currently ongoing at Lowe’s. The new centre has also been set up to enable associates to experience more flexibility in today’s hybrid world,” said Ankur Mittal, senior vice president – Technology and managing director, Lowe’s India.
Fiserv Global Services, the GCC of fintech major Fiserv, helps provide fintech and payment technology solutions to its global clients through associates in India, Costa Rica and the US. It has operated in India since 2005 to deliver innovative solutions through delivery centres in Bengaluru, Chennai, Gurugram, Noida, and Pune.
“Some of our focus areas include establishing high-end engineering teams to lead product buildouts end-to-end, develop global product management discipline, and expand capabilities in emerging and established technologies such as digital, analytics, AI, ML, intelligent automation, and cloud,” said Srini Krish, president, Global Services, Fiserv.
US commodities giant Cargill has recently expanded in India with the opening of a new business service office in Bengaluru and a new headquarters in Gurugram. Cargill business services (CBS) will now have a combined workspace with 3,800 seats in India. Cargill has been present in India for 35 years but in the last seven years, CBS India has grown to become Cargill’s largest GCC globally.
“Through our GCC in Bengaluru, we envision bringing together the best talent in the industry to deliver tech-driven capabilities that help Cargill serve our customers and our communities better. With aspirational goals and a comprehensive action plan, we aim to increase diversity at all levels and foster an even stronger culture of inclusion,” said Sumit Gupta, country leader for CBS in India.