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cost service providers for their parent company in the affluent part of the world.
That was the time when the highly transactional and repetitive work was being
offshored to Indian centers, who were more than happy to provide these services
leveraging the abundantly available pool of Indian graduates and basic
computers with Microsoft office.
Come 2015, the industry has evolved with these ‘transaction service providers’
becoming ‘innovation centers’. Not only has the mundane transaction processing
work being automated, the centers are high on the strategic agenda of many
global fortune 500 companies. What happened during this journey? What made
these centers such an indispensable part of the parent companies in the US and
Europe?
The EY GIC practice has been tracking the maturity trend of these centers over
the last decade. In their latest GIC report of 2015, the eighth editions, the key
levers used by captives or Global In-house centers to become innovation
partners have been elaborated.
1. Expand functional & geographic scope – the centers showcased the existing
capabilities in which they excelled and enhanced the scope to include high end
complex work in similar domains. Also asked for expansion of existing service
portfolio to new geographies esp high growth emerging markets
2. Create ‘talent hubs’ – GICs expansion over the last year has been driven by
talent/skill and not by mere cost arbitrage. For instance F&A skills (esp. CAs) in
Rajasthan and NCR, Engineering Research & Development in Pune, IT in
Bangalore, Analytics in Chennai etc are key talent hubs
3. Deploy global delivery network - GIC organization structure is also undergoing
change with GICs being organized by process rather than ‘BUs or geographies’.
Global process leads are now based in the Indian GIC center, driving end-to-end
process transformation
Since the parents can now see direct/indirect impact of the centers on their top
and bottom line, their belief in these centers is being re-enforced. Mature GICs
are projecting a new face of performance measurement wherein the GICs now
“own” the SLAs / KPIs. The GICs measure the SLAs / KPIs for performance
measurement however the parent organization no longer monitors these service
agreements as the GIC is considered an equal partner for delivery of defined
business outcomes. In some mature GICs, leadership is part of the global
governance council playing a key role in taking strategic decisions for the entire
organization.
Gradually these centres also transform as a hub to drive innovation and create
disruptive solutions for local and global markets. In their new ‘avatar’ the Indian
GICs are an integral and irreplaceable extension of their parent company, and
surely much more evolved than their global peers.
To access the summary of the report, please visit www.ey.in Follow @EY_India
(https://twitter.com/EY_India) and #eyfinance