Talent, Tech, Transformation: Key Insights from nasscom GCC Conclave 2024

In its annual GCC Conclave held at Bengaluru today, nasscom, in collaboration with KPMG in India, has launched the report titled ‘GCCs in India: Building Resilience for Sustainable Growth’.

The report was launched in the presence of Debjani Ghosh, President, nasscom, Srikanth Srinivasan, Vice President, nasscom, and Shalini Pillay, India Leader – Global Capability Centre, KPMG.

The findings presented are derived from the brief survey and interviews conducted by nasscom and KPMG in India with leading executives of GCCs in India across various size, scale, and industry sectors.

India’s Global Capability Centre (GCC) ecosystem has emerged as a major driver of growth and innovation. During a keynote session at the event on India’s evolution in global capabilities, Debjani Ghosh, says India has around 1600 GCCs, with an addition of one GCC per week.

Several factors like access to a wide pool of digitally skilled talent, the drive to adopt new technologies and the move to make greater customer impact are driving the growth of the GCC ecosystem in the country. Debjani says that towards end of decade, the GCC segment is expected to cross 2,000 and could contribute one to two per cent of India’s GDP.

However, this rapid growth and scale of GCCs has also brought to the forefront some associated challenges and considerations that need to be addressed as organisations continue to evolve. The report identifies four considerations for GCCs as they move up the value chain including talent management, strategic emerging technology adoption, navigating regulations, and de-layering the concentration concerns.

As GCCs in India are transforming and moving up the value chain, roles are expanding and evolving. There is a growing demand for high value digital skills in areas such as automation architecture, cloud development, AI/ML, data science, etc.

According to the study by nasscom, given the competitive talent market, availability, attraction and retention of niche talent, building a pipeline of readily deployable talent with the new emerging skills, finding and nurturing, talent equipped for global leadership positions and cost arbitrage have emerged as key challenging factors facing GCCs in India.

Navigating these challenges, GCCs are leveraging innovative workforce strategy models such as hire-build-scale, borrow- augment & co-create, to achieve near, medium, as well as long-term goals. These organizations are embracing a comprehensive approach that ensures a steady stream of skilled individuals ready to meet emerging and future business needs, with a focus on both talent demand forecasting and building a robust talent pipeline. Further, these GCCs are also implementing measures to develop future-ready leadership and stepping up to handle global roles.

Fueled by rapid adoption of emerging technologies, India’s GCCs are transforming from transaction-focused centers to innovation hubs. They are advancing GenAI capabilities and streamlining governance for global organisations. Key strategies include continuous skill development, minimising tech implementation impacts on customer experience, and fostering an innovative, value-driven workforce to rethink, redefine, and reimagine their approach in a four-tiered ecosystem.

During a fireside chat, Sunil Gopinath, CEO, Rakuten India Enterprises Pvt Ltd shared how around eight years ago, the enterprise had 50 employees in India, the count of which has now increased to around 5,000 and “there’s a technology driven transformation,” he said.

“India in last six-seven years, has seen a rise in data science, deep tech, AI and that’s the future,” he added.

The report further underscores how navigating regulations is a key concern for GCCs, with over 55% of leaders emphasising its importance for smooth operations. It identifies transfer pricing as the top regulatory consideration, followed by SEZ/STPI regulations and labor laws. To address these considerations, the report introduces a self-assessment compliance maturity framework to help GCCs evaluate their current standing and ensure adherence to regulations. As GCCs continue to evolve and adapt, proactive engagement with regulatory frameworks will be paramount in ensuring sustained success and contributing to India’s position as a global business hub.

The paper emphasises the need to address concentration concerns beyond headcount. By using diverse metrics, GCCs can identify critical exposures, assess vulnerabilities, take proactive measures, and provide comprehensive reports to global organizations.

Commenting on the report, Srinivasan said, “Over the last few years, we have witnessed a remarkable growth of GCCs in India with several factors driving its growth. As GCCs continue their growth trajectory, moving up the maturity curve, with factors such as blurring geographic borders and technology disruptions, these centres are constantly scanning the dynamic risk landscape and adapting to successfully navigate through.”

Sharing her insights on the report, Pillay said, “India as a nation, is gearing up to attract many more global players to establish and scale their GCCs over the next 3-5 years. As these GCCs continue to build, innovate and scale, adopting new operating models influenced by the emerging technologies, they are also equipping themselves to navigate through a dynamic risk landscape and hence further fortifying the resilience of this model.”

“The policy changes at the government level is pivotal,” Debjani said, adding at present India has 45% of GCCs of the world and to make it to 60% or 70%, policy changes are needed. “From Global Compatibility Centre to becoming the ‘nerve centres’ for global business India has big opportunity,” she said.