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In the late 1980s, when the first global organization set up an India GCC, few could have predicted the revolutionary impact this move would have on the global tech landscape.
“I always like to tell the story of the first adventurer, Texas Instruments, that came way back in the late eighties. There is a famous picture of them carrying a dish antenna on a puller cart to just place it over their center. So, starting from days such as that to now where, you know, we are able to set up GCCs within like three months or four months. I think this is the ecosystem and the infrastructure has evolved significantly.”
– Karthik Padmanabhan, Managing Partner, Zinnov
This anecdote perfectly encapsulates the remarkable transformation of Global Capability Centers (GCCs) in India. Fast forward to today, and India’s GCCs have become powerhouses of innovation, driving change across industries worldwide.
The GCC story in India began as a tale of cost arbitrage. Multinational companies saw an opportunity to slash expenses by outsourcing basic tasks to a country with a large, educated, English-speaking workforce. But India had bigger dreams, and its GCCs were about to embark on an extraordinary journey.
As the ecosystem matured, GCCs in India started to shift gears. Companies like Honeywell and Bosch recognized the potential of Indian talent and began entrusting their centers with more complex engineering tasks. This transition marked the beginning of a new era – one where India was not just a cost-saving destination but a hub for high-value work.
Today, India boasts over 1,700 GCCs, a staggering growth from the 400-500 centers just 15 years ago. These aren’t just back offices; they’re innovation powerhouses driving global change across industries. The real game-changer is the global impact of these Indian GCCs, extending far beyond cost savings.
Take Philips, for instance. Their Indian innovation center develops software that powers MRI machines used in hospitals worldwide. About 30% of these complex machines are differentiated through software – much of it created in India. This isn’t an isolated case. Saint-Gobain, a 360-year-old company known for cutting-edge material science, set up a research center in collaboration with IIT Madras, showcasing India’s capability in pure, groundbreaking research.
The influence of Indian GCCs extends beyond product development. Bosch India, with over 10,000 employees, doesn’t just manage its local centers; it oversees Bosch Vietnam, acting as a bridge to Bosch Japan. This showcases how Indian talent is taking on global managerial roles, shaping strategies that impact operations worldwide.
Perhaps one of the most compelling examples of Indian GCCs driving global change comes from an unexpected source – South America. Falabella, a major South American conglomerate, turned to its Indian GCC to spearhead its digital transformation. The result? A platform called Catalyst, comparable to Amazon’s ecosystem, was developed primarily in India and successfully deployed across Falabella’s global operations. The project’s success was so impressive that the Indian center head is now the global CIO, based in Chile.
As impressive as these achievements are, Indian GCCs are setting their sights even higher. The next frontier? Moving from R&D to full-scale Manufacturing and Commercialization. While only a handful of GCCs currently have significant Manufacturing operations in India, there’s enormous potential for growth in High-tech Manufacturing sectors like Semiconductors and Defense.
This shift towards manufacturing represents a new challenge and opportunity. It requires GCCs to navigate complex regulatory landscapes, build new capabilities, and integrate more deeply with local Supply Chains. Companies that successfully make this transition will not only enhance their value proposition but also contribute significantly to India’s economic growth and technological self-reliance.
The push into Manufacturing is not just about production; it’s about completing the full cycle of innovation. By bringing manufacturing closer to R&D centers, GCCs can accelerate product development, respond more quickly to market demands, and create a more integrated ecosystem of innovation in India.
Parallel to the manufacturing evolution, another exciting development is unfolding – the emergence of global leaders from Indian GCCs. Since 2015, the number of global leadership positions in Indian GCCs has grown from 115 to over 6,500 today, including 900 women leaders. These roles cut across functions like engineering, operations, product management and more. By 2030, we believe that there will be as many as 30,000 global leaders based out of India, spearheading innovation and strategy for global corporations.
This surge in leadership roles reflects the maturing of the GCC ecosystem in India. Companies are investing heavily in leadership development programs, recognizing that technical expertise alone isn’t enough. The goal is to create well-rounded leaders who can navigate complex business environments, understand global markets, and drive innovation on a global scale.
The impact of these leaders extends beyond their companies. Just as we’ve seen “mafias” emerge from companies like PayTM and ThoughtWorks, spawning numerous start-ups and unicorns, we’re on the cusp of seeing a “GCC mafia” – leaders from GCCs driving innovation and entrepreneurship across India’s tech ecosystem.
This rise of global Indian leaders is reshaping the narrative of India’s role in the global business landscape. It’s not just about executing tasks anymore; it’s about shaping strategies, driving product development, and leading global teams from India.
As we look to the future, the potential of India GCCs to further impact the global market is immense. They’re not just contributing to their parent companies; they’re reshaping entire industries, driving innovation, and positioning India as a global tech leader. The expansion into manufacturing and the rise of global Indian leaders are set to write exciting new chapters in this ongoing success story.
However, challenges remain. As GCCs move towards more complex roles in Manufacturing and Commercialization, they’ll need to navigate new regulatory landscapes and build new capabilities. Developing the next generation of global leaders will require continued investment in both technical and soft skills.
Despite these challenges, one thing is clear: India GCC are no longer just participants in the global tech ecosystem – they’re driving it. From the days of dish antennas on bullock carts to spearheading global innovation, Indian GCCs have come a long way. And if the past is any indication, the best is yet to come.
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