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Cloud & Automation: Changing CSPs’ OpEx outlook
Global Capability Centers (GCC) are driving the enterprise-wide agenda for digital transformation, cementing their position as strategic assets for global corporations. GCCs are establishing centers of excellence in areas such as Artificial Intelligence (AI), automation, and cybersecurity. Over 60 percent of digitally advanced GCCs are now engaged in enterprise-wide AI initiatives, leveraging GenAI, Machine Learning (ML), and real-time data analytics to accelerate transformation.
Increasingly, an organization’s business competitiveness is being linked to the maturity level of its GCC. As a hub of innovation and skills in cutting-edge technologies, GCCs are responsible for designing, overseeing, and upgrading the technology infrastructure and software applications to catalyze the parent organization’s future-readiness.
AI, automation, and data analytics are transforming how GCCs generate value. The talent they hire is hence critical to their success. GCCs are today positioning themselves as magnets of talent in niche technology and functional skills, blending technology adoption with a future-proof workforce strategy.
BCG reports that while 89 percent of companies have invested in AI, only 26% have successfully scaled value. It highlights the urgent need for AI-literate talent in GCCs to bridge the implementation gap.
GCCs are shifting from experimentation to practical applications of AI focused on talent management and risk mitigation. A recent study by EY concluded that over 78 percent of GCCs are upskilling teams for GenAI adoption, while 37% are piloting use cases. This embedding of AI fluency across functions will help GCCs harness the potential of AI, ML, and cognitive computing in the next 2-3 years.
AI and intelligent automation have enabled some GCCs to boost productivity while creating demand for new roles such as AI product management, data governance, and algorithm auditing. There is a 20–25% lateral movement of talent from IT firms to GCCs, driven by better pay, exposure to end-to-end product ownership, and opportunities in emerging technologies like ER&D.
As GCCs evolve into digital and AI-driven innovation hubs, the need to innovate responsibly is becoming increasingly important. While enterprises turn to GCCs to scale AI and data analytics, they also expect them to take ownership of governance, compliance, and ethical oversight throughout the implementation process.
EY highlights that data-led GCCs must be supported by robust governance frameworks. This includes enforcing data quality standards, establishing clear ownership models, and aligning with global compliance requirements. Standardized metadata frameworks and traceability mechanisms are critical to ensuring responsible data use.
BCG observes that while many GCCs are exploring AI use cases, only a few have implemented the right mix of agility and risk controls. High-performing GCCs are setting up cross-functional governance teams, including legal, compliance, technology, and procurement. These teams provide oversight and enable safe, scalable innovation within defined guardrails.
McKinsey emphasizes that as AI adoption increases, GCCs are taking a leading role in model risk management. This includes deploying tools for explainable AI, bias detection, and compliance monitoring. Transparency and traceability are essential for building trust in AI systems, particularly in regulated industries.
Some organizations are leading the way with their GCCs already utilizing advanced technology to drive business benefits.
India has emerged as the preferred destination for global enterprises to establish and scale their capability centers. A stable and supportive political landscape, the availability of talent in tech and functional areas, a large consumption-driven domestic economy, and a robust regulatory framework have enhanced India’s appeal to global corporations.
GCCs need to continuously evolve by adopting new technologies and trends so as to remain competitive and future-proof. GCCs are increasingly leveraging Gen AI to automate reports, create content, and model business scenarios to drive fast iteration and innovation. They are proactively aligning with global environmental goals to optimize resource utilization and incorporate sustainable technologies such as AI-powered energy management and IoT sensors within their facilities.
With cybersecurity and regulatory compliance gaining importance, GCCs are leveraging encryption and multi-factor authentication to drive AI-based cybersecurity. They are also focusing on regulatory technologies to streamline compliance and monitor regulatory changes.
Going forward, GCCs will be evaluated not on intent but on impact. They will need to demonstrate the value they have delivered in driving innovation and digital transformation and their agility in turning challenges into opportunities. Only then can they continue to be strategic assets for their parent companies.