Technology and innovation top the agenda for Global Capability Centers - EY

According to EY’s GCC (Global Capability Centers) Pulse survey 2020, GCCs are uniquely positioned to play an even more integral role than before. The current pandemic has further accelerated this evolution to provide a proposition focussed on delivering enhanced business value to the parent organization. GCCs ranked innovation, technology enablement and enhanced service portfolio as the top three drivers of their strategy.

The study incorporates first-hand perspective of over 30 GCC leaders to understand the adoption of the future operating model and strategic imperatives with a focus on their vision, digital strategy, talent management, operations and resilience.

Arindam Sen, Partner, Business Consulting, EY India said, “GCCs are playing a crucial role in helping organizations navigate through a change of unprecedented magnitude, by carving out niche opportunities and driving the transformation agenda. GCCs are rethinking across the attributes of culture, people, technology, performance and policy in order to ensure a seamless transition into the new normal” .

Key insights from the survey include:

Innovation emerged as a primary focus area in GCC strategy

68% of the respondents rated innovation and process excellence as the top-most consideration in their strategy. GCCs are encouraging the culture of innovation. A third of the organizations use innovation-linked incentives for employees, with around 63% ensuring easy availability of ideation tools. Collaborating with the start-up ecosystem in India has given GCCs access to new business models that can help further the innovation agenda of the enterprise

Technology enablement to enhance service portfolio

55% of the respondents considered technology enablement as a key consideration in their strategy. Given the shift to a virtual operating model, technology has assumed center stage. Migration to cloud, optimum remote working and ensuring best in class cyber security are the top three elements which were extensively adopted by the respondents in order protect their business from enhanced points of risk. GCCs strongly believe adopting emerging technology will act as the common lever across all dimensions of the operating model.

Embracing Digital

95% of GCCs consider superior customer service to be the driving factor of the GCCs’ digital strategy followed by process simplification through automation at 89%. As GCCs move up the value chain within their organizations, digital transformation has become a key enabler to drive success. Most of the GCCs have developed a comprehensive digital strategy and are leading their way towards practical implementation.

Analytics is redefining value

63% of the GCCs surveyed have a dedicated analytics COE. Organizations are focusing on delivering insights as a strategic value lever. GCCs are now expected to provide measurable value and deliver actionable strategic insights as against the basic dashboards. While all GCCs provide insights generated from service delivery back to the parent organization, mature GCCs have taken an ownership of the analytics function, as a value driver to organizations.

Driving Automation in GCC service delivery

GCCs have been consistently investing in automation over the last decade.77% of the respondents are already leveraging existing platforms and technologies to drive their automation agenda. Automation is being extensively leveraged to promote touchless transaction processing across all functional areas of service delivery making it an integral part of the organization's digital strategy.

Talent

93% of the respondents indicated that talent acquisition is the most important lever to drive scale, closely followed by right skilling of the employees at 87%. GCCs are increasingly focusing on developing future-ready leaders and are prioritizing talent management initiatives like right-skilling keeping long-term strategy in mind.

Hybrid is the future

COVID-19 has brought a significant change in the ways of working with increased digitization, agility, personalization, shifting mindset to favour flexibility, freedom and independence of work. These mega trends are redefining the operating model for GCCs. 60% of the GCCs surveyed predicted having 20%- 40% of their staff operating virtually by 2023. GCCs now have differentiated focus across Work, Workforce and Workplace, to tap into the benefits from the ‘new normal’ to move into the next stage of maturity.

“As GCCs continue to transition from ‘Work from Office’ to ‘Work from Anywhere’, sustained virtualization provides benefits of access to a boundary-less talent pool, optimized operating costs and employee flexibility. However, true adoption of this model, requires careful consideration of several elements across culture, policies, technology and performance management.” said Kunal Ghatak, Partner, Business Consulting, EY India.