GCC revenue to double to $75-80 billion in the next 4-5 years in India: Deloitte’s Gupta

Gaurav Gupta, Partner and GCC Industry Leader, Deloitte India, recently apprised DH’s Lavpreet Kaur on the ecosystem for GCCs in India and the prospects it holds.

Global Capability Centres (GCC) - the offshore units of multinationals offering back-end support be it contact point, information technology, finance, human resources or analytics - have sustained and evolved with the times in India. By 2025, India is expected to have over 1,900 GCCs employing 2 million people and earning $60 billion, according to the National Association of Software and Service Companies (Nasscom). Gaurav Gupta, Partner and GCC Industry Leader, Deloitte India, recently appraised DH’s Lavpreet Kaur on the ecosystem for GCCs in India and the prospects it holds.

Edited excerpts:

What turned India into a destination for GCCs?

There's no denying that the first set of GCCs came to India on the basis of cost arbitrage. But if you see today, most of global organisations are automating more, giving rise to the need for techno-functional talent, which is highest in India as compared to most of the other countries. In numbers, close to 45 to 50% of GCCs are operating out of India and the industry is now roughly 1% of India's GDP.

How have GCCs impacted the tech talent supply in India?

GCCs invest right in terms of training and development. Global organisations have best practices and technologies that they deploy in different countries. People working with GCCs are exposed to that.

How have GCCs engaged with upskilling/reskilling with technological advancements?

During Covid, for example, GCCs had to immediately respond to provide support. It's not that the GCCs were sitting with abundant talent. They actually rescaled and retrained people. Secondly, GCCs are strong believers in culture. So if they have good employees, they actually look at providing mobility options, cross-selling options, job rotations, etc.

What they should focus more on is newer technologies. There's always that war for talent. Now, one way is obviously you continue to hire expensive talent from the market. At the same time, you can also continue to create a pipeline of talent and train them internally.

What are the challenges before GCCs today?

There are two. The first one exists within the GCC itself - its mindset. While we have enough examples of GCCs going up the value curve, I think it will be some time before it becomes a more prevalent endeavour. The other is understanding how to manage global stakeholders. Getting access to technology, training, etc, are important but there are softer aspects around mindset and change management which are bigger areas to focus on.

Are businesses leveraging GCCs for business-facing, non-technical roles?

Yes, they are. But, is it as high as it is for some of the enabling areas- maybe not. There are now quite a few GCCs who are looking at doing that. For example, most of the fintechs have got large operations here and they've got teams. Some of the pre-sales operations including services, customers connect, customer profiling, analytics and sales analytics are here. So I think a lot of it has moved from the back office to mid-office, but there is also a component of the front office that operates particularly for financial services and auto technology.

Are GCCs looking at talent from tier-II and tier-III cities?

Given the attrition rates in cities such as Bangalore, Hyderabad, Chennai, Pune, Gurgaon, etc in terms of the kind of quantity of talent GCCs are looking at tier-II, tier-III cities. And then companies are also starting to follow a hub and spoke model and a large part of that is to tap into the talent in these cities.

What is your outlook for GCCs in India?

We see the GCCs revenue going up to $75-80 billion from $40-45 billion in the next 4-5 years. The existing GCCs will expand in terms of not just headcount, but also value add. Secondly, we see now a lot more global midsize, which is $5-15 billion revenue organisations setting up centres that may not be at a scale of 20,000 or 50,000 people, but 1000, 2000, 5000. These are the two factors that will continue to drive at least interest in India.