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Forces to shape Global Capability Centers (GCCs) in 2021
Forces to shape Global Capability Centers (GCCs) in 2021

March 22, 2021

GCC

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Global Capability Centers (GCCs) will be focused on efficiency, innovation, and modern practices in 2021. GCCs will likely move to a hybrid model – part physical and part virtual, and highly digital.

 

India has been driving back-office functions for large enterprises across the world for quite some time now. However, over the past few years, it has taken huge steps towards becoming the global innovation hub, by adding strategic value to global businesses, through GCCs based out of India. The acceleration of digital transformation has been experienced in almost all the global industries. The pressure of the digital revolution has been delegated to the GCCs based in India. COVID-19 pandemic has further added to this digital revolution and will continue to disrupt the industries and sectors this year. The digital transformation journey of GCCs will see a surge in 2021. 

 

2021 began with GCCs seeing a drastic shift in their priorities – an increased focus on accelerating technology initiatives. Technology and innovation are the top agenda for Global Capability Centers in 2021. As per EY’s Global Capability Centers Pulse survey 2020, GCCs are uniquely positioned to play an even more integral role than before. The COVID-19 pandemic has further enhanced the digital evolution to provide enhanced business value to the parent organizations. GCCs ranked innovation, technology enablement and enhanced service portfolio as the top three drivers of their strategy. Top key insights from the survey include:

 

  • Innovation is the primary focus area in GCC strategy:
    • 68% of the respondents rated innovation and process excellence as the top-most consideration in their strategy.
    • A third of the organizations use innovation-linked incentives for employees, with around 63% ensuring easy availability of ideation tools. 
  • Technology enablement to enhance service portfolio:
    • More than half of the respondents considered technology enablement as a key consideration in their strategy. Cloud migration, remote working and cybersecurity are the top three elements adopted to protect businesses from risk. 
    • GCCs believe adopting emerging technology will act as the common lever across all dimensions of the operating model.
  • Embracing Digital:
    • 95% of GCCs consider superior customer service to be the driving factor of the GCCs’ digital strategy followed by process simplification through automation at 89%. 
  • Driving Automation in GCC service delivery:
    • 77% of the respondents are already leveraging platforms and technologies to drive their automation agenda. 
    • Digital transformation has become a key enabler to drive success, as GCCs move up the value chain.
  • Hybrid is the future:
    • COVID-19 has brought a substantial change in the ways of working. The megatrends brought by COVID-19, including digitization, agility, personalization, flexibility, freedom, and independence of work, are redefining the GCCs’ operating model.
    • 60% of the GCCs predicted having 20%- 40% of their staff operating virtually by 2023. 
  • Talent:
    • Most of the respondents indicated that talent acquisition is the most important lever to drive scale, closely followed by the right skilling of the employees.
    • GCCs are progressively focusing on developing future-ready leaders and are prioritizing talent management initiatives like right-skilling keeping long-term strategy in mind.

 

Sources:

EY (link 1)

EY (link 2)


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