What is a GCC? Understanding Global Capability Centers

In a world where digital is no longer optional and businesses are expected to evolve at the pace of innovation, Global Capability Centers (GCCs) are no longer back-office operations; they’re strategic engines. Multinational corporations (MNCs) aren’t just outsourcing for savings anymore. They’re building deeply integrated hubs that drive agility, enable product acceleration, and support enterprise transformation from the inside out.

India, with its rich tech ecosystem and deep talent pool, has emerged as the heartbeat of this shift. As of early 2025, the country hosts more than 1,700 GCCs employing close to 1.9 million people; a figure projected to surge past 2.8 million by 2030. The question for global firms isn’t whether to set up a GCC, but how to get it right.

This article takes a closer look at the Global Capability Center model: what it is, how it’s evolved, what it enables, and why it’s become a cornerstone of global business strategy.

Defining the Global Capability Center

Think of a Global Capability Center, also known as a Global In-house Center (GIC) or Captive Center, as a fully owned offshore or nearshore unit of a multinational company. It’s not outsourcing in the traditional sense. These centers offer full control, seamless alignment with enterprise goals, and complete ownership of the work and the IP it generates.

The early versions of Global Capability Centers focused on predictable support functions such as IT tickets, customer service, finance operations. But those days are long gone. Today’s GCCs are running enterprise-grade systems, developing digital products, designing AI models, and anchoring global R&D.

In many firms, these centers aren’t just aligned with strategy—they help define it.

From Transactional to Transformational: The Evolution of GCCs

The story of Global Capability Centers begins in the 1990s. Back then, the model was straightforward: move repeatable, rules-based tasks offshore to reduce costs. India, with its engineering talent and cost advantage, became the obvious choice. The early GCCs were transaction-driven, focused on support desks, data entry, claims processing.

But as India’s digital infrastructure matured in the 2000s, so did the expectations from these centers. The second wave brought in software engineering, advanced analytics, and domain-specialized functions. Policy moves like the Special Economic Zones (SEZs) and growing onshore-offshore collaboration helped push this shift forward.

Since 2015, we’ve entered a third wave. Today’s GCCs are innovation hotbeds. AI labs, cloud-native platforms, and cyber defense teams are all being built and scaled out of India.

Look at JPMorgan Chase’s setup in Bengaluru. What began as a traditional IT support base now powers core AI research shaping global risk and compliance frameworks. That’s the arc of transformation.

Core Functions Delivered from GCCs

The range of responsibilities handled by Global Capability Centers has expanded dramatically over the years. What started as function-specific support has evolved into a wide-ranging operational backbone that cuts across business lines, domains, and geographies. Today, these centers are instrumental in powering large-scale digital transformation efforts, co-developing products, and delivering critical enterprise outcomes end-to-end.

Below are the most common service areas:

Technology and Engineering

• Application development and testing
• DevOps and cloud platform engineering
• Cybersecurity and threat detection
• Enterprise architecture and systems integration

Data, Analytics, and AI/ML

• Predictive modeling and forecasting
• Cognitive automation
• Natural language processing (NLP) solutions
• AI/ML model development and training

Finance and Risk

• Financial reporting and consolidation
• Regulatory and statutory compliance
• Treasury operations
• Internal audit and risk analytics

Human Resources

• Global recruitment and onboarding
• Payroll processing and workforce analytics
• Learning and development (L&D) systems

Customer Experience

• Omnichannel contact center operations
• Customer journey mapping
• UX/UI design and service personalization

Research & Development

• Prototyping and simulation
• Intellectual property management
• Emerging tech research (e.g., quantum computing, 5G)

This functional depth explains why Global Capability Centers are increasingly treated not just as support entities but as co-innovation partners and transformation catalysts.

India: The Global Hub for GCCs

India’s lead in the GCC space is not by accident. As of 2025, the country is home to over 1,700 operational GCCs with close to 1.9 million employees. This base is projected to grow to between 2.5 and 2.8 million by 2030.

According to a recent industry report, Global Capability Centers in India are expected to generate between 425,000 and 450,000 new jobs in 2025 alone. Much of this growth is driven by high-value sectors such as BFSI (Banking, Financial Services, and Insurance), manufacturing, and retail-tech.

Regional Employment Breakdown (2025):

• Bengaluru and Chennai: 29%
• Hyderabad: 23%
• Pune: 32%
• Mumbai: 19%
• Delhi NCR: 16%

Pune’s rise is especially notable—mid-sized GCC companies are picking it for its cost efficiency and access to high-quality engineering talent.

Strategic Advantages of the Global Capability Center Model

Here’s what makes Global Capability Centers a compelling choice for global enterprises:

• Cost Optimization – Companies report 30-50% overall cost savings when setting up GCCs in India compared to operating similar centers in developed countries.

• Talent Abundance – India produces more than 1.5 million STEM graduates annually, giving GCC companies a vast, renewable supply of digital talent.

• Innovation at Scale – Co-location of engineering, analytics, and design capabilities in a single Global Capability Center drives faster experimentation and product delivery.

• Operational Control – Unlike third-party outsourcing, Global Capability Centers offer full visibility into workflows, governance structures, and compliance practices—critical for industries like healthcare, BFSI, and defense.

• Enterprise Agility – Global Capability Centers act as “always-on” innovation engines that can rapidly prototype solutions, respond to market shifts, and ensure resilience.

• Strategic Talent Development – With global roles increasingly being anchored in India, GCC companies have turned their centers into a pipeline for the next generation of enterprise leaders.

What Are the Key Factors to Consider When Setting Up a GCC?

Setting up a high-performing Global Capability Center goes far beyond simply choosing an affordable city. It demands a thoughtful approach that connects business objectives with executional realities. From how work gets done to how teams are structured and supported, every layer matters. The success of a GCC often hinges on how well it’s planned across operations, technology, and organization design. Here are the key factors to consider:

• Alignment with Business Strategy – The GCC should align with long-term corporate goals—whether focused on innovation, customer experience, or operational scalability.

• Scope of Services – Clearly define the scope—IT services, R&D, customer support, analytics, etc.—to ensure that talent and infrastructure planning is precise.

• Talent Availability – Assess the availability of skilled professionals in targeted domains such as AI/ML, finance, or digital engineering.

• Technology Infrastructure – Evaluate the quality of digital infrastructure—high-speed internet, cloud-readiness, and cybersecurity capabilities.

• Organizational Integration – Design robust governance models, reporting lines, and knowledge transfer processes to integrate the GCC with headquarters effectively.

• Leadership Pipeline – Have a plan to groom local leadership to reduce over-dependence on expatriates and enhance cultural alignment.

What Are the Key Considerations for Selecting a Location for a GCC?

Choosing the right city or region to set up a Global Capability Center can significantly influence its performance and longevity. Below are the critical location-selection considerations:

• Talent Ecosystem – Cities with access to leading universities and a growing startup ecosystem are better suited for innovation-driven GCCs.

• Cost Structure – Assess not just labor but also real estate, utilities, and living costs to ensure long-term viability.

• Infrastructure Readiness – Ensure the availability of high-grade office spaces, reliable utilities, and strong transport connectivity.

• Government Incentives – Some Indian states offer attractive policies (e.g., Karnataka GCC policy) that include subsidies, tax breaks, and fast-track approvals.

• Quality of Life – Cities with good healthcare, education, and safety rankings are more likely to attract and retain talent.

• Scalability Potential – Consider whether the city can support long-term expansion—from 100 to 1,000+ employees.

How Important Is Legal and Regulatory Compliance When Setting Up a GCC?

Legal and regulatory compliance is a foundational element in establishing and operating a Global Capability Center. Non-compliance can lead to reputational damage, financial penalties, and operational disruption.

• Entity Formation and Taxation – Ensure accurate structuring of the legal entity (e.g., Private Limited, LLP) and understand corporate tax implications.

• Employment Laws – Familiarize yourself with local labor laws including employment contracts, gratuity, provident fund, and social security.

• Data Privacy and Security – India’s evolving data protection frameworks require GCCs to have secure data handling and storage policies.

• Intellectual Property (IP) – Ensure that IP created in the GCC is protected under relevant jurisdictions and agreements.

• Transfer Pricing Regulations – Comply with arm’s length pricing and documentation standards for transactions between the GCC and headquarters.

• Regulatory Approvals – Obtain all necessary industry-specific licenses and comply with foreign exchange laws such as FEMA.

Early engagement with legal advisors, regulatory consultants, and government liaison teams is essential for a smooth and compliant GCC setup.

Challenges in the GCC Sector

Here are some of the ongoing challenges the sector continues to grapple with:

• Talent Attrition – Tech turnover remains high. Companies are investing in retention strategies, continuous learning, and leadership development.

• Regulatory Compliance – With global data regulations tightening, GCC companies must prioritize data localization, compliance audits, and legal advisory partnerships.

• Leadership Gaps – Although the talent base is large, building global-ready leaders within the GCC sector remains a work in progress.

• Infrastructure in Emerging Cities – Tier-2 cities are promising, but lack ecosystem maturity. Strategic incentives and co-investments can bridge the gap.

• Governance and Alignment – To avoid siloed innovation, GCC companies must establish clear governance models that align with HQ objectives.

Spotlight: Leading GCC Companies

Several MNCs have turned their GCCs into global performance engines. A few standout examples:

• Google – Its GCC in Hyderabad works on advanced cloud solutions and AI models.
• Amazon – Operates multiple GCCs focused on logistics, AWS engineering, and Prime product development.
• Goldman Sachs – Their Bengaluru GCC delivers risk analytics, cybersecurity, and product innovation.
• Unilever – Manages global digital marketing and data science capabilities from its Bengaluru hub.

These GCC companies exemplify how strategic alignment and operational excellence can yield significant business impact.

The Future of Global Capability Centers

The global GCC sector, valued at $128.5 billion in 2023, is projected to grow to over $300 billion by 2032, with a CAGR of 13.51%. India will remain central to this transformation.

Key trends to watch include:

• AI-Powered GCCs – Driving innovation, personalization, and automation at scale.
• Sustainable GCCs – Aligning with ESG goals through energy efficiency and inclusive hiring.
• Tier-2 City Expansion – Emerging centers will increase geographic and operational resilience.
• Strategic Workforce Models – Hybrid, flexible, and purpose-built teams will define next-gen Global Capability Centers.

Global Capability Centers have transcended their origins as cost-saving hubs to become essential enablers of enterprise transformation. With a talent-rich ecosystem, digital maturity, and strong policy support, India stands at the forefront of the global GCC sector.

For organizations evaluating global expansion, Global Capability Centers represent a strategic, scalable, and sustainable solution. For GCC companies, continued investment in innovation, leadership, and ecosystem partnerships will determine success in the decade ahead.

As we look to 2030 and beyond, Global Capability Centers will not just support global business—they will redefine it.