Communicating with GCC's
Quick Summary: In the past ten years, approximately 1,600 multinational companies have pursued a strategy of reducing their dependence on Indian IT service providers. Instead of outsourcing software development, they have opted to establish their own technology divisions within the country. These in-house development facilities are commonly referred to as global capability centers (GCCs).
The initial avatar of GCCs, also called captive centers, were primarily in charge of what could be called back office tasks – call centers, customer service, document management and data processing. It was a no brainer decision to move these tasks to cheaper locations and India, with its good supply of engineering talent became a favorite destination. While outsourcing may have provided better arbitrage in some cases, it also came with the potential baggage of domestic backlash.
The role of Global Capability Centers (GCCs) in India have significantly transformed since those years. No longer are they focused solely on back-office tasks, but instead are prioritizing technology and innovation-led initiatives. This change in emphasis has led them to become more receptive to modifying their approaches, diversifying their talent pool, making strategic investments in digital technologies, and emerging as the global hub for innovation within their parent organizations.
The popularity of GCCs shows no signs of receding and according to Nasscom’s projections, the number of GCCs in India is expected to surpass 2,000 by the fiscal year 2026-27. Now even global mid-sized companies, typically generating around $20 billion in revenue, are demonstrating a growing interest in establishing their own technological capabilities.
Given the new reality of GCCs, it is important to keep several factors in mind if you are looking to communicate with GCCs. Ideally your communication efforts would be more fruitful once you start with a good understanding of the pain points of the GCCs. These could become easy talking points and conversation starters.
So what are the key pain points of Global Capability Centers (GCCs) which you should know before you reach out to them.
What niche skills are the needed ?
To increase innovation and become tech hubs for their parent organizations, GCCs are investing in advanced technologies like analytics, AI, and machine learning, as well as related resources such as tech talent and tools. However, the inability to attract and retain talent with niche skills is a significant risk for them in India. This is especially difficult because these companies are competing for this talent with IT firms who have built advanced capabilities in core and emerging areas and offer a career path for talent in these areas.
What is changing at GCCs ?
Shifting Employee Expectations: Employee expectations have shifted over the course of the pandemic, giving rise to higher attrition rates for GCCs in India. Therefore, employee value propositions must be re-evaluated in the areas of organisational culture, nature of work, career advancement, and rewards and compensation.
What are some of the challenges that GCCs are facing ?
Employee Productivity: Employee productivity is a challenge since there is a major shift to hybrid working models, and GCCs are still struggling with this. While offices have opened up, there is still a lot of resistance to coming to the office on a regular basis. The recent spike in attrition of women employees in TCS after the management decision to call people back to offices on a more regular basis demonstrates that many employees value flexibility more than anything else.
Cultural and operational integration: One big challenge that up and coming GCCs face is integrating with the parent organization’s culture and operational processes. Bridging the gap between local and global practices, aligning with the parent company’s vision, and fostering effective collaboration can be complex tasks that requires relentless efforts, but remains a constant challenge especially when the tenure of the staff is on the lower side.
Confidentiality and regulatory concerns: The need of companies to keep sensitive data and intellectual property within their own boundaries rather than outsourcing such work to external vendors is a key driver. The need for confidentiality and compliance with regulations drives companies to establish in-house GCCs. Many organizations strike a balance between in-house tech development and outsourcing. They partner with IT services providers for certain capabilities while keeping strategic and sensitive projects in-house. So this awareness is always beneficial while approaching them.
How do GCC's attract and retain talent ?
Retention is challenging for GCCs, as most employees leave within 2-3 years. This is because of the lack of a defined career path for employees with niche skills. It companies are better positioned to create centers of excellence for these skills and attract the right talent with the promise of securing them a clear progress in their career path.
It’s important to emphasize the benefits of staff augmentation services, such as cost savings, access to skilled professionals, and the flexibility to scale up or down as needed. These benefits can help GCCs to address their key challenges and achieve their business objectives. Here’s how:
Access to niche skills
As GCCs go up the ladder in terms of work quality, most requirements are for niche skills that are hard to find in their home countries. Staff augmentation services can help them save on the costs associated with recruitment and training, providing pre-trained professionals with the required skill set at short notice.
Time zone differences
GCCs in India often need to work with teams and clients located in different time zones. Staff augmentation services can provide them with access to professionals who can work on flexible schedules, allowing them to collaborate with teams and clients in different time zones.
Need for scalability
GCCs may need to scale up or down their operations quickly to respond to changes in the business environment. Staff augmentation services can give them the flexibility to scale their workforce up or down as needed without lengthy recruitment processes.
It’s essential to keep things creative and fun. You can use humor, exciting visuals, and engaging language to capture their attention and make your message more memorable. GCCs face several key challenges, such as attracting and retaining talent, upskilling the existing workforce, and more. Therefore, it’s essential to address these pain points directly and offer solutions to help them overcome these challenges. Each GCC is unique and has its own set of challenges and priorities. Therefore, when communicating with them, it’s important to offer customized solutions that address their specific needs and objectives. This can help build trust and establish a long-term partnership.
