How to Set Up a Global Capability Center in India: A Step-by-Step Guide

Global Capability Centers (GCCs) have become a strategic advantage for multinational corporations. With India emerging as the preferred destination for GCCs, businesses across industries are leveraging the country’s skilled workforce, cost efficiencies, and robust infrastructure to optimize operations and drive innovation.

This guide provides a step-by-step approach to successfully establishing a GCC in India, from defining your objectives to operationalizing the center.

Table of Contents

1. Define the Purpose and Scope of Your GCC

The first step is to clearly define why you’re establishing a GCC and what role it will play in your global strategy.

1.1. Understand Your Objectives

Cost Optimization: Reduce operational costs through India’s competitive salary structure.
Innovation and R&D: Create a hub for developing cutting-edge technologies and solutions.
Operational Excellence: Streamline processes like IT services, customer support, or compliance.

1.2. Determine the GCC’s Scope

Functions to Be Handled: Identify specific tasks (e.g., analytics, R&D, or shared services).
Level of Autonomy: Decide whether the GCC will operate independently or under centralized control.
Target KPIs: Define metrics such as cost savings, efficiency gains, and innovation outputs.

2. Choose the Right Location

India’s cities offer unique advantages for GCCs, and selecting the right location is critical to your center’s success.

2.1. Factors to Consider

Talent Pool: Does the city offer a strong pipeline of skilled professionals?
Cost Efficiency: Evaluate real estate costs, operational expenses, and salaries.
Infrastructure: Assess connectivity, availability of IT parks, and utilities.
Government Support: Look for cities offering tax benefits, subsidies, or SEZ (Special Economic Zone) status.

2.2. Top GCC Cities in India

Bengaluru and Hyderabad: Ideal for IT and innovation-focused centers.
Pune and Chennai: Known for engineering and manufacturing expertise.
Tier 2 Cities (Jaipur, Kochi): Cost-efficient alternatives with emerging talent pools.

3. Navigate Legal and Regulatory Requirements

Setting up a GCC involves complying with India’s legal framework and regulations.

3.1. Company Registration

Register your business as a Private Limited Company or a Limited Liability Partnership (LLP).
File with the Ministry of Corporate Affairs (MCA) and obtain required licenses.

3.2. Taxation and Incentives

Direct Tax Benefits: Utilize tax exemptions under SEZ schemes.
Indirect Tax Relief: Claim GST benefits on services.
Consult local legal experts for clarity on corporate tax laws.

3.3. Labor Laws

Ensure compliance with India’s labor laws, including employee benefits, working hours, and contract regulations.
Hire legal advisors to manage compliance risks.

4. Build a Talent Acquisition Strategy

Recruiting the right talent is essential for your GCC’s success.

4.1. Leverage Recruitment Platforms

Use Supersourcing to find pre-vetted candidates for technical and leadership roles.
Partner with local recruitment agencies for bulk hiring.

4.2. Campus Recruitment

Collaborate with universities and technical institutes to hire fresh graduates.
Conduct hackathons and innovation challenges to identify high-potential talent.

4.3. Employee Value Proposition

Offer competitive salaries, growth opportunities, and a collaborative work environment to attract top talent.

5. Set Up Infrastructure and Technology

Operational success depends on establishing a robust infrastructure tailored to your GCC’s needs.

5.1. Office Space

Opt for IT parks or coworking spaces in SEZ zones for cost savings and benefits.
Evaluate options based on scalability, connectivity, and facilities.

5.2. IT Infrastructure

Invest in cloud-based tools for global collaboration.
Implement cybersecurity measures to safeguard sensitive data.

5.3. Operational Tools

Use project management software like Jira or Trello to streamline workflows.
Adopt AI-powered tools for recruitment and HR operations (e.g., Supersourcing).

6. Establish Governance and Processes

Strong governance ensures alignment between your GCC and global headquarters.

6.1. Define a Governance Model

Centralized Governance: HQ oversees all GCC operations.
Hybrid Model: Share decision-making responsibilities between HQ and GCC leadership.

6.2. Standardize Processes

Create templates and SOPs (Standard Operating Procedures) for key tasks.
Conduct regular audits to ensure compliance and quality.

7. Leverage India’s Innovation Ecosystem

GCCs in India are ideally positioned to collaborate with startups and research institutions.

7.1. Collaborate with Startups

Partner with AI, IoT, and fintech startups to accelerate innovation.
Invest in promising startups to co-develop technologies.

7.2. Build R&D Capabilities

Establish in-house labs to focus on emerging technologies like AI, blockchain, and renewable energy.
Work with institutes like IITs and IISc for research partnerships.

8. Manage Employee Engagement and Retention

Retaining top talent is a common challenge for GCCs in India.

8.1. Focus on Learning and Development

Offer certifications and training in new technologies.
Provide mentorship programs to build leadership skills.

8.2. Promote Work-Life Balance

Adopt hybrid work models to enhance flexibility.
Provide wellness programs, recreational facilities, and employee assistance programs.

8.3. Recognize and Reward Employees

Celebrate achievements through awards, bonuses, and promotions.
Regularly gather employee feedback to improve policies.

9. Monitor and Optimize Performance

Track your GCC’s performance to ensure it meets business objectives.

9.1. Key Metrics to Track

Cost savings compared to other regions.
Efficiency improvements in core processes.
Employee productivity and satisfaction rates.

9.2. Continuous Improvement

Conduct quarterly reviews to identify improvement areas.
Use analytics tools to monitor performance in real-time.

10. Case Study: A Successful GCC in Action

Company: Global Tech Innovators
Objective: Establish a GCC in Bengaluru to handle R&D and customer service operations.

Key Strategies Implemented

Partnered with Supersourcing for recruitment, reducing time-to-hire by 40%.
Collaborated with startups to co-develop AI-based customer service solutions.
Created a retention program offering training in emerging technologies, achieving an 85% retention rate.

Results

Delivered three innovation projects within the first year.
Achieved a 20% cost reduction compared to the previous outsourcing model.

Conclusion: Building a GCC for Success

Setting up a GCC in India offers unparalleled opportunities for growth, innovation, and cost optimization. By following this step-by-step guide, businesses can navigate the complexities of location selection, compliance, recruitment, and operations with confidence.

Platforms like Supersourcing simplify recruitment and operational challenges, helping you establish a high-performing GCC that aligns with your global objectives.

Ready to set up your GCC in India? Start your journey today and unlock the full potential of India’s talent and innovation ecosystem.