“According to a survey by Deloitte, 75% of companies have plans to expand their GCCs in the next three years. This indicates that businesses see GCCs as an effective way to build operational resilience and achieve strategic goals.”
In today’s global business world, companies are setting up Global Capability Centers (GCCs) more and more. They do this to save money, come up with new ideas, and make their operations work better. GCCs are a crucial part of a company’s worldwide presence, and they provide valuable services, technology, and innovation to customers. But to keep getting better at what they do, GCCs need to figure out and measure their Key Performance Indicators (KPIs).
GCCs have evolved beyond operating in isolation; they are now forging mutually beneficial partnerships with
- Startups
- Educational institutions
- Local communities.
These collaborations facilitate the flow of new concepts and cultivate a vibrant innovation environment.
According to the 2023 Global Shared Services and Outsourcing Survey conducted by Deloitte, more than 40% of Global Capability Centers (GCCs) have initiated collaborations with nearby universities and research institutions, encouraging a valuable interchange of ideas and expertise.
The GCC’s Pivotal Role in Organizational Resilience
As the world grappled with the COVID-19 pandemic, organizations faced unprecedented challenges. They had to adapt to remote work, respond swiftly to shifting consumer demands, and ensure business continuity amid uncertainty. In this context, Global Capability Centers emerged as a beacon of stability and innovation.
GCCs have been at the forefront of driving innovation and operational efficiency for their parent organizations. They became the vital link between global enterprises and their customers, employees, and partners. This crucial role extended to end-to-end product development, encompassing various technology stacks, user experience enhancements, and compliance measures for consumer-facing products.
In a survey by EY, it was found that 74% of GCCs are like important hubs for digital skills and getting things done online.
GCCs as Incubation Engines
Beyond their role in immediate crisis response, GCCs are actively contributing to the long-term resilience and growth of their parent organizations. Many GCCs see themselves as incubation engines, fostering a culture of innovation. They have structured ideation processes in place that facilitate the generation, assessment, and piloting of new ideas.
Digital Transformation and Scale
In today’s digital-first world, organizations must embrace digital transformation to remain relevant. GCCs are instrumental in operationalizing their parent organizations’ digital strategies, translating them into action, and providing the necessary scale for success.
According to the EY survey, 68% of GCCs are actively involved in implementing their organization’s digital strategies. This involvement goes beyond just planning; it extends to execution and scalability. By harnessing the power of technology, GCCs are helping their parent companies navigate the complexities of the digital landscape.
The Future of GCCs
The journey of GCCs is far from over; in fact, it is just beginning. As organizations continue to evolve in response to changing market dynamics, GCCs are set to play an even more integral role in shaping the future. Here are some key ways in which GCCs are poised to reinvent tomorrow:
- Innovation Ecosystems: GCCs will increasingly serve as innovation ecosystems where ideas are born, nurtured, and brought to life. They will foster collaboration between cross-functional teams, combining the strengths of technology, data analytics, and human ingenuity to drive innovation.
- Digital Twins: The concept of digital twins, where a virtual replica of a physical entity is created, will gain prominence. GCCs will leverage this technology to optimize processes, enhance predictive maintenance, and improve decision-making across various industries.
- AI and Automation: Artificial Intelligence (AI) and automation will continue to be central to GCC strategies. These technologies will be employed to streamline operations, enhance customer experiences, and drive efficiency across the board.
- Cybersecurity and Compliance: With the increasing reliance on digital technologies, cybersecurity and compliance will remain top priorities for GCCs. They will continue to develop robust cybersecurity frameworks and ensure that their parent organizations adhere to regulatory requirements.
- Talent Development: GCCs will focus on nurturing talent, not just in technical domains but also in soft skills such as adaptability, creativity, and critical thinking. This multifaceted approach to talent development will be crucial in meeting the evolving needs of organizations.
- Sustainability Initiatives: As sustainability becomes a key concern for organizations worldwide, GCCs will actively contribute to eco-friendly practices. They will integrate sustainability into their operations, helping their parent companies achieve environmental and social goals.
How GCC is playing with Data
Currently, GCCs are heavily investing in smart data, machine learning, video/image analysis, and chat-based robots using text data for conversation. These investments highlight how using data cleverly can reduce manual work, boosting accuracy and efficiency. Explore these instances.
- A retail GCC uses product data to group items accurately, aiding pricing decisions through a user-friendly portal, eliminating past manual errors.
- Another GCC employs financial data and algorithms for cash flow analysis, offering insights into payment delays, credit risks, and bad debts, enabling timely predictions.
- A different GCC accelerates factory production with curated search engines, providing quick solutions for production issues on high-throughput lines.
- One GCC automates data cleaning with customizable algorithms, extending machine learning to minimize supervision.
- Another GCC uses data to forecast palm fruit yield, helping plantation managers plan operations and improve yields efficiently.
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Conclusion
Global Capability Centers are not merely responding to the challenges of today; they are shaping the future. Their pivotal role in enabling organizational resilience during the pandemic has solidified their position as catalysts for innovation and transformation. As they continue to evolve, GCCs will be instrumental in reinventing tomorrow, driving progress, and ensuring that their parent organizations thrive in a dynamic and ever-changing business landscape.
