GCC’s: The Second Headquarters for Business Hubs

Global Capacity Centres (GCCs) have become second hequarters and replicate almost all functions of business - including finance, information technology, human resources and core business functions - which will remain key factor supporting growth of sector in future.

Global Capability Centers are offshore units of multinational corporations which perform a range of strategic functions by leveraging special talent, cost vantages and operational efficiencies in various locations worldwide.

According to a Nasscom-Zinnov report, India’s GCC market size is currently valued at a substantial $46 billion, with an anticipated impressive growth rate of 11.4 per cent Compound Annual Growth Rate (CAGR).

In a conversation with Republic Business, Vikram Ahuja, Co-Founder ANSR, and CEO Talent500 attributed this shift to strong ER&D service provider community, mature start-ups, peer-GCC ecosystem and favourable government policies which are driving factors for this growth.

“Unlike a dece ago, today's GCCs are at forefront of leveraging artificial intelligence (AI) and innovative technologies to drive efficiency, enhance productivity, and create new business opportunities,” he said.

se are also evolving as innovation hubs on back of building niche skills and capabilities for ding data analytics, cloud services, treasury, sustainability, logistics and warehousing as operations for value dition, he ded.

According to Rohit Arora, co-founder of financial Software as a Service (FinSaaS) provider Biz2x and Biz2Credit, Global capacity centres in India are no longer back offices.

“For companies like ours, who have businesses in US and or parts of world, GCC in India is not a back office anymore. It's a middle office and also it's a it's a spring he for a lot of innovation,” he said.

Apart from developing cutting-edge technologies and helping workforce, he ded that se GCCs will create local specific use of AI including large language models and applications which will sit on top of it.

India as Winner in AI

Arora feels four or five countries are going to emerge as “winners” in AI race and everybody else will actually be just following m.

For India to become one of those winning countries, a shift from software power to hardware prowess is essential, but US and China, which hold control over se technologies “are in no mood to share it,” Arora said.

One of strategies is to foray into Middle East, wherein Saudi government is creating a $40 billion fund dedicated to AI technologies. 

Attracting GCCs and right talent is equally crucial, and this trend is supported by cross pollination of global talent.

“It has improved, but still you don't find a lot of non-Indians working in India.” he ded.

Citing example of Dubai and Singapore, he said moving of talent to se centres helps elevate skill sets, increase exposure and also it gives a massive amount of stimulus to economy because ancillaries and spending goes up.

India’s next GCC Hubs

Ahuja said currently, most GCCs are concentrated in metros having a technical ecosystem, such as Bengaluru, Hyderab,  Pune, Chennai, and Delhi NCR.

  “se  cities offer a robust infrastructure, a large pool of skilled  professionals, and proximity to leing educational institutions, making m attractive locations for GCCs across various industries,” he ded.

Bengaluru has emerged as foremost hub for both Marketing and Sales centres, according to Nasscom and Zinnov report backed by its world-class infrastructure and deep talent pools.

Oracle, SAP, obe, and AstraZeneca are some of companies with GCCs in region. 

However, Mumbai and NCR also host strong clusters given ir metro vantage.

But five years down line, a grual shift will be visible in distribution of GCCs towards non-technical hubs and emerging Tier 2 and Tier 3 cities in India.
 
Backed by government incentives and improving infrastructure, apart from skilled professionals, Jaipur, Chandigarh, Coimbatore, Bhubaneswar, and Indore are likely to emerge as next GCC establishments.

Arora also bets on Chandigarh, Jaipur, Indore, and Bhubaneswar which have seen an influx of IT service companies.

“GCCs  may increasingly explore locations beyond tritional tech hubs to capitalise on cost vantages, tap into regional talent, and  mitigate risks associated with talent shortages and infrastructure challenges in major cities,” he ded.

Backed by digital connectivity and remote working, GCCs may also consider setting up satellite offices or remote delivery centres in smaller towns and rural areas to tap into talent in those regions, he ded.