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GICs aim at creating cost saving enterprises

| | New Delhi

Indian Global In-house Centers (GICs) have grown impressively over the last 20 years - the GICs’ ability to create cost savings for the enterprises while tapping India’s talent pool have been the primary drivers of this growth. As of today, digital disruption is impacting every industry and changing global CXO priorities - organisations are now spending 45 per cent of their IT budgets on growing their business, compared with only 20 per cent previously - this together with other technology changes is creating a unique window of opportunity for GICs, according to a report which was launched on Thursday by Bain & Company and National Association of Software and Services Companies (NASSCOM).

 “The Indian GIC landscape has evolved significantly over the last 20 years. Ongoing growth and enterprise integration has resulted in GICs emerging as a mainstream operating model for top global organisations to accelerate enterprise transformation. GICs have experienced a significant paradigm shift from being offshore service delivery centers to strategic enablers that support the growth, differentiation and innovation agenda of global enterprises,” says KS Viswanathan, Vice President, Industry Initiatives, NASSCOM.

The report aims to capture the changing role of Indian GICs, as digital disrupts industries. GICs are offshore centers of large global organisations that perform designated functions such as R&D, IT, analytics etc.

“Today, there are about 1,100 GICs across the country, employing more than 800,000 individuals and generating approximately $23 billion in revenues. It’s their ability to create cost savings for an enterprise, while tapping India’s talent pool that has led to this impressive growth,” says the report.

Digging deeper into the unprecedented digital disruption in industries, the report finds that while it is critical for GICs to excel at digital-age IT capabilities, they also need to continue focusing on reducing the cost of traditional IT to help CXOs fund growth initiatives.

Based on the results of a survey of 30 CXOs of Fortune 1,000 companies and 80 Indian GIC leaders, the report finds that Indian GICs will play a more active role in driving top-of-mind investment priorities of global C-level executives at Fortune 1000 companies in the next three to five years.

“Digital disruption across industries and the increasing role of technology has created a unique opportunity for Indian GICs to step up and play a bigger role within global enterprises. But this will require a holistic approach, a concerted effort and a shift in mindset. The journey is unlikely to be business as usual,” said Arpan Sheth, partner at Bain and co-author of the report.

 
 
 

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