Opinion

GCCs, closer to the vortex of innovation



Hiring by India-based global capability centres (GCCs) of multinational technology companies has overtaken that by domestic IT service providers. This marks a shift in the demand for Indian tech workers from providing all-round IT and back-office support, primarily off-site, to working on frontier technologies such as AI. It aligns with the view of tech titans that India is a key market for deploying innovative solutions, while also coming up with the solutions themselves. Big Tech uses GCCs to leverage talent, cost and efficiency in order to develop new products and to support strategy. In that sense, the Indian technology talent pool is being drawn a bit closer to the vortex of innovation.

India hosts the world’s biggest cluster of GCCs, and projections are it could add half as many as it has now by the end of the decade. In relation to a slower staff churn in domestic IT companies, hiring demand by GCCs remains robust. Although there is an overlap in support functions, GCCs have a wider range of skill requirements. Particularly those skills where competitive intensity is higher in software development, for instance, cybersecurity. Technology transfer is also smoother between a multinational and its offshore unit, which drives the demand for specialised skills. GCCs typically have a higher impact on workforce skilling than third-party technology support services.

GCCs allow companies to focus on their core strengths and make them more adaptable to change. An earlier generation of captive back offices was consumed by third-party vendors. Now, however, companies do not wish to lease out a basic function like digital transformation. Offshore units are easy to scale up or down in an environment of disruptive technology. Apart from product innovation, GCCs offer compelling corporate solutions as well, which may account for their rising popularity. India has a huge advantage in this space it should preserve through supportive policy, as the GCC trend spreads to other parts of the world.



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