Global In-house Centres (GICs) in India today number over 1,000, employ 745,000 people with an estimated export revenue of over USD 19 billion in FY2015. What began as a small step for MNCs like Texas Instruments in the early 1980s is today a giant leap – India is today the world’s leading global location for setting up Global In-house Centres.
GIC centres in India over the last decade-and-a-half have scripted a story of success – moving from a ‘proof-of-concept’ to centres of strategic importance. This segment has been growing at a CAGR of 11 per cent since FY2010, with a relative share of about one per cent of India’s GDP. Mirroring the growing maturity of the Indian IT-BPM industry, GICs today have moved past the “cost centre” stage. They are now increasingly focusing on high value activities such as IP-creation, building competencies around emerging technologies, setting up COEs and taking full ownership of vendor management. These factors are positively impacting the parent firms’ top-line and bottom-line through faster time-to-market, product/process optimisation and expansion to new geographies/services. There are increasing cases of Indian GIC leaders having global roles and the GIC governance model is more accountability-driven. GICs have also integrated deeper into the Indian ecosystem by forging partnerships with start-ups, universities and service providers.
Apart from this, GICs have also taken up the Digitisation mandate for their parent firms – helping the parent evolve to a Digital Enterprise. GICs are addressing digitisation opportunities in the areas of customer targeting & engagement, workforce enablement, operational excellence, supply chain, risk management, and developing digital product and services.
Despite this success, the GICs continue to face certain challenges. Cost arbitrage continues to be a key driver and with increasing financial constraints, being cost competitive is becoming a delicate balancing act. Attracting and retaining talent is becoming more and more critical as even start-ups today are offering competitive wages. Developing leadership skills (balancing business, technical and people aspects) and domain specialists across verticals is gaining importance.
Going forward, GICs in India are on the path to becoming the global sourcing hub for the organisations’ entire IT and business process needs with focus on delivering business value and innovation supported by high quality talent, leadership and technology.
The "GICs in India-Getting ready for the Digital Wave" report is a follow-up to the 2010 report and is the first part of a two-part report. This report gives an overview of the GICs in India, their presence across segments (IT, BPM, ER&D), geographies and verticals, detailed industry trends, growth drivers, challenges, best practices being implemented to overcome these and highlights potential growth opportunities.
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