GCCs driving revenue that’s the inflection point for them

We have often said on these pages, GCCs or global capability centres – the tech and operations arms of MNCs – are one of the best things happening for India right now. They bring lots of jobs, many of them high-quality jobs, they transfer a lot of tech skills to Indians that then enable local high-tech entrepreneurship, they raise the bar on compensation, they set up world-class office facilities, many work with our educational institutions to upgrade syllabi and collaborate on R&D, and some of them are beginning to move into our smaller cities, dispersing the growth process.Now, how do we see this trend going forward? What will it take to accelerate the trend? These were some questions we discussed with a panel of leaders at the Nasscom GCC Summit in Hyderabad last month.But before that, we also discussed how we got here. As Sangeeta Kumar, MD & CEO of BNP Paribas India Solutions, said, India built trust with global corporate leaders over a long period through sheer execution excellence – delivering projects without errors, on time, without data loss. “There are a lot of controls and processes in which India teams have done really well. So anything that gets sent to India is delivered much better than it was being done elsewhere globally,” she said.Rajesh Nambiar, president of Nasscom, noted that Indian IT services providers, and early GCCs like those of GE and American Express also played a phenomenal role in setting these standards, with practices like Six Sigma and Lean.Jaideep Agarwal, India GBS leader for Warner Brothers, who had worked at American Express in its early days here, noted that there were no Bibles called standard operating procedures or workflows when work first came to India. Developing the fundamentals of process excellence, he said, took time – they had to take employees through the journey of ₹think process’, ₹think failure modes’.This accomplishment increased the influence that Indian teams had over global leaders. And that allowed them, over time, to take on bigger global roles, leadership roles, and, increasingly now, take on projects that have a business impact.Business impact – inflection pointThat revenue impact, Nambiar noted, is the inflection point for a GCC. The biggest benefit to a GCC, he said, comes when it crosses the threshold from being part of the cost equation to a revenue equation. “If you’re a CFO sitting in New York and you’re looking at some of this, it’s a no brainer. But the moment you get the attention of the CEO looking at the business side and saying that, you know, this is not just an outpost that you want to leverage from a labour and cost point of view, but this is an outpost where you want to truly leverage the talent, the expertise and truly integrate it with what the corporation is trying to do and provide a better value proposition to the end customers (then you get into a different trajectory),” he said.That’s indeed what the more mature GCCs are doing today. Naveen Gullapalli, who leads US biopharmaceutical company Amgen’s India technology and innovation centre, noted that the centre was set up as part of an enterprise scale exercise, to bring in talent at scale. “Amgen is looking to serve double the number of patients that we’re serving. And the way to serve that is through scale across our functions,” he said.Agarwal said the rollout of Warner Bros’ Max streaming platform was the big reason for establishing the Hyderabad centre. The centre helped build the platform and is helping roll it out. “We are in 77 countries and we hope to be in every single territory or every single geography in the world. And that’s where we see our Hyderabad office playing a pivotal role, in accelerating that. And that’s the impact we are making from a revenue standpoint, because the faster we are able to roll out, the faster those markets are able to come on board, and faster those subscribers can view our content,” he said.Sangeeta noted that GCCs are today being leveraged to mine the massive amounts of data available to understand industry and customer trends, and thereby make critical front-end contributions. She also said that across insurance, banking and investment, mediumscale firms too are now pivoting to India, having seen the success of the large institutions.Ecosystem collaborationEveryone also noted that the ecosystem has been hugely collaborative, helping each other grow. Agarwal noted that Gullapalli had hosted Warner Bros’ leadership team some three or four times to help them understand the opportunities in India.Nambiar noted the role Nasscom plays, and said cross-sectoral GCC collaborations could be useful in dealing with common issues like transfer pricing and upgrading skills.