With over 250 new Global Capability Centers (GCCs) expected in India, the country is becoming a hub for innovation and strategic growth for global companies.

Table of Contents

GCC

India is witnessing a significant rise in the Global Capability Center (GCC) sector, with over 250 new centers expected to be established in the next 3-5 years, according to a recent study by CaptiveAide and Feedback Insights.

The report, Back to the Future: What You Did Not Know About Setting Up a Successful GCC in India—Today, reveals that companies from the US and UK are increasingly looking to India as a strategic destination for setting up their GCCs, not just for cost savings but also for innovation and strategic growth.

Once perceived primarily as a way to reduce operational costs, GCCs in India have evolved into vital innovation hubs for global enterprises.

India’s skilled talent pool, cost advantages, and substantial intellectual property (IP) protection have made it an attractive location for organizations across industries.

Key Drivers of GCC Growth in India

The study highlights several key factors fueling the rapid growth of India’s GCC market:

Cost Efficiency: For many companies, India offers substantial cost savings compared to other global locations. With 57% of surveyed decision-makers identifying cost reduction as a significant factor, the country’s favorable operating costs remain a critical draw.
Vast Talent Pool: India’s workforce is known for its technical expertise and education in critical areas like IT, engineering, and finance. Over 52% of respondents noted that access to skilled talent is a primary reason for establishing GCCs in India.
IP Protection: Companies setting up operations in India also benefit from the country’s strong intellectual property laws, which 42% of respondents cited as a critical factor in their decision-making. These protections offer global companies confidence in safeguarding their innovations and proprietary knowledge.

“India’s GCCs have moved beyond traditional operational support functions. They are now pivotal to driving digital transformation and product innovation for global companies,” said Ganesh Jayaraman, Business Head – Advisory Services at Feedback Insights.

Strategic Focus for GCC Success in India

As India continues to attract global companies, the report outlines four critical areas for ensuring the successful establishment and growth of GCCs:

Operational Clarity: Defining the operating model and governance structure is essential for smooth operations. Clear roles, responsibilities, and decision-making processes ensure effective functioning.
Local Solid Leadership: Empowering local leaders with deep industry expertise and cultural understanding is crucial to the success of GCCs in India. Local leadership bridges the gap between global strategy and local execution.
Cultural Integration: Effective cross-cultural communication and collaboration are essential in a global work environment. Fostering cultural awareness helps companies navigate differences and build strong working relationships.
Regulatory Compliance: Adhering to local regulations is vital for maintaining smooth operations. Companies must implement robust compliance measures to meet legal requirements in India.

While opportunities abound, companies face challenges such as cultural integration (noted by 84% of respondents) and regulatory compliance (highlighted by 55%). However, the report emphasizes that these challenges can be effectively managed with strong leadership and local partnerships.

India: The Future Hub for Global Innovation

As GCCs in India continue to evolve, the country is positioning itself as a global hub for product development, digital transformation, and strategic innovation.

The report underscores companies leveraging India’s cost advantages and talent resources drive long-term growth and operational excellence.

Jawahar Bekay, Managing Partner at CaptiveAide Advisory, noted, “Organizations that align global strategies with local expertise are reaping the benefits of India’s growing GCC market. They are not just cutting costs but unlocking new avenues for innovation.”

With over 250 new GCCs expected to be established, India’s global impact in the GCC space is set to increase.

This expansion will bolster India’s position as a leader in driving global innovation and economic growth, making it a prime destination for businesses seeking strategic advantages in an increasingly competitive market.

Conclusion: A Booming Market with Strategic Advantages

India’s Global Capability Center (GCC) market is poised for unprecedented growth, transforming global companies’ operations and innovation.

With cost savings, access to a highly skilled workforce, and strong legal protections, India offers a compelling proposition for companies seeking to establish centers of excellence that drive operational efficiency and innovation.

As companies continue to target India for strategic growth, the GCC market is poised for continued expansion, making the country a key player in the global economy.

Trivia

Did you know India is home to some of the world’s largest GCCs, which support critical functions for major corporations in the technology, healthcare, and financial services sectors?