Global In-house Centres (GICs) have evolved and matured over the past one-and-a-half decades in India.
NASSCOM has actively focused on the GIC sector, observing its changing landscape and identifying future opportunities and challenges. It has regularly initiated studies on the GIC market and is using the findings as benchmarks and advisories for the sector.
Based on these studies, it is apparent that GICs are experiencing a significant shift in terms of their role, position and integration with global parent firms, leading to a corresponding shift in talent, managerial and leadership challenges and expectations.
According to NASSCOM, GICs are:
- Going through the ‘next wave’, a ‘beyond hyper growth scenario’, where they are occupying centre stage as hubs of innovation, product development and centres of excellence
- Shifting focus from labour cost arbitrage to breadth or depth of talent or the level of technical skill sets they are making available to parent organisations
- Reinventing themselves, to look beyond transactional work, enhance job content and improve employee engagement
- Gearing up to manage relationships with third-party service providers, and also compete with third -party service providers in India for offshore and outsourced work from parent organisations
- Offering broader value addition, client management and managerial capabilities to overseas stakeholders
- Improving governance and accountability to improve credibility and draw business from parent organisations
In this next phase of expansion, the integration, roles and scope of GIC activities have substantially increased. A number of GICs have grown their roles as international centres coordinating critical global processes including R&D.
This growth however, NASSCOM says, is leading to fresh challenges, particularly related to accelerating value addition, enhancing innovation, collaborating with parent organisations, remaining in regulatory readiness (particularly for organisations that operate in the BFSI segment) and creating a strong pipeline of highly specialised and skilled talent and leadership.
GICs need to fuel their growth through collaboration, which remains a critical component in enabling success for both parent organisations and these firms, Everest research indicates that different aspects of collaboration can be fine-tuned and mastered to create a non-linear impact on the success of GICs and parents.
Meanwhile, GICs operating within the BFSI industry need to stay ahead of the curve by remaining in regulatory readiness. They can do so by gaining a deeper level of understanding on processes, systematically rethinking and redesigning their compliance approach and learning best practices from each other while maintaining complete confidentiality of individual participants.
Facing the Talent Conundrum
Finally, there is the issue of talent, which remains a primary concern for all GICs. While labour cost arbitrage was essentially the leading driver behind the establishment of many early GICs, today, it has moved to the breadth or depth of talent or the level of technical skill sets available in India.
Going forward, GICs will need to pay attention to leadership building, career development and engagement. The top three emerging talent priorities for GICs in the next three to five years therefore are:
- To provide employees with long-term career paths and development opportunities
- Build executive leadership pipelines
- Build employee engagement
GICs must nurture leaders who showcase qualities such as in-depth knowledge of the parent organisation, its business and processes; people and team management skills; ability to innovate new product/services, business management skills (finance and operations); ability to take on parent organisation and global roles; deep technical knowledge of GIC services; and ability to grow current operation and new businesses.
Studies show that GICs in India who self-assess their HR and talent capabilities as ‘world-class’ are likely to have a positive outlook, a sharper focus on leadership development and pipelines and impact on customer growth and revenue and the parent organisation’s expansion in global and emerging markets.