Global capability centers

A global capability center (GCC) is a strategic offshore or nearshore entity established by multinational corporations (MNCs) to build in-house capabilities across various business functions. These centers serve as an extension of the parent organization,^[1] delivering critical services such as technology development, business operations, finance, human resources, and customer experience, among others.^[2]

History and evolution

GCCs have evolved from traditional offshore delivery centers^[3]—originally focused on cost arbitrage and back-office functions—into advanced hubs for innovation, technology, and business transformation. The concept gained traction in the early 2000s as companies sought to optimize operations through captive centers rather than outsourcing to third-party vendors. Over the years, GCCs have grown into strategic enablers, driving digital transformation, artificial intelligence (AI) adoption, and enterprise-wide efficiencies. According to McKinsey, GCCs are moving from being execution centers to becoming transformation catalysts.^[4]

Initially created as cost-saving units focused on back-office tasks, modern GCCs now act as partners driving digital change, innovation, and market growth. Their role includes creating value through advanced analytics, process improvements, and collaborative R&D efforts aligned with company goals. ^[5]

Landscape and growth

India, the Philippines, Poland, Mexico, and China are among the top destinations for GCCs due to their talent pools,^[6] cost advantages, and regulatory frameworks. According to NASSCOM, India leads the GCC landscape, hosting more than 1,700 centers ^[7] across industries, including banking, retail, healthcare, and manufacturing. The GCC ecosystem is expanding rapidly, with a growing focus on high-value functions such as AI, cybersecurity, and cloud engineering. According to a Boston Consulting Group report, GCCs continue to drive the enterprise's innovation agenda. The report states that Indian GCCs with their outcome-focused methods has pushed the boundaries of innovation in a manner that is distinct from conventional global definitions.^[8]

Workforce and talent strategy

GCCs employ a diverse, multigenerational workforce, requiring tailored compensation and benefits strategies.^[9] Unlike traditional offshore models, GCCs emphasize employee experience, career development, and global mobility, aligning with parent organizations' objectives. Talent attraction and retention are key priorities,^[10] with organizations investing in skilling, leadership development, and cultural integration.

The future of GCCs

GCCs are poised for continued evolution, shifting from execution-focused units to centers of excellence driving enterprise innovation. Emerging trends such as hybrid work models, AI-powered automation, and sustainability-driven business strategies are reshaping the GCC operating model. As companies expand their GCC footprint, the focus will be on unlocking value beyond cost efficiency—leveraging these centers for strategic growth, product innovation, and business resilience. EY estimates that India's GCC market size will reach US$110b by the year 2030,^[11] led by software exports, which remains a key component of India's service exports.