Outsourcing Non-Core Functions_ The GCC Trend in India

Global Capability Centers (GCCs) are a critical part of the global business ecosystem. Acting as the extended arm of multinational corporations, these centers handle a range of tasks that are vital to operations. But as smaller GCCs emerge in India, there’s a noticeable shift in their approach—outsourcing non-core functions like human resources (HR) and administrative tasks to consulting firms.

Why is this trend taking off? How does it benefit businesses? Let’s break it all down.

GCCs are specialized centers that manage critical functions for their parent organizations, such as IT support, customer service, research, and development. These centers essentially act as a “digital twin” to the parent company, mirroring their functions while tapping into global talent pools.

India has positioned itself as the hub for GCCs, thanks to its large talent pool, cost advantages, and innovative tech ecosystem. Smaller GCCs, in particular, find India attractive because they can operate efficiently at a fraction of the cost of other global locations.

Not everything a company does is directly tied to its core mission. Non-core tasks like HR management, compliance, payroll, and general administration are essential, but they don’t directly contribute to the development of the company’s products or services.

Here’s why outsourcing these tasks makes sense:

• • Cost Efficiency: Outsourcing non-core tasks reduces overhead expenses.
  • Focus on Core Areas: By delegating routine tasks, GCCs can focus on strategic projects and innovation.
  • Scalability: Consulting firms often offer scalable solutions, making it easier for GCCs to grow.
  • Access to Expertise: Local consulting firms understand the market dynamics, regulations, and cultural nuances, making them an invaluable partner.

When GCCs offload non-core responsibilities, it allows them to focus on what they do best—building products and driving innovation.

Take, for instance, a tech-based GCC working on developing AI solutions. By outsourcing payroll and compliance to a consulting firm, they can channel their energy into research and development, creating value for the parent company and customers.

Consulting firms have stepped up to bridge the gap for GCCs in India. They offer:

• Recruitment and Talent Management: Finding the right talent and onboarding them efficiently.
• Payroll Management: Ensuring employees are paid on time, with taxes and compliance sorted.
• Regulatory Compliance: Staying on the right side of the law without stressing about ever-changing regulations.
• Shared Platforms: Using shared technology platforms to streamline and automate routine processes, further cutting costs.

When smaller GCCs outsource non-core tasks, they can achieve greater operational efficiency. Processes that were previously bogged down by manual intervention or inefficiency are now optimized by experts.

For example, a GCC outsourcing its compliance processes to a firm that uses automated tracking systems will avoid penalties and reduce the risk of errors. Efficiency like this doesn’t just save money—it also builds trust with stakeholders.

In markets like the United States, regulators value transparency and dependability. When GCCs decouple their operational platforms (like HR or payroll) and hand them to specialized firms, it demonstrates a commitment to compliance and accuracy.

This separation of core and non-core functions also means fewer risks for the parent organization.

To be a “digital twin” of the parent organization, GCCs need to reflect the parent company’s operations accurately and efficiently. Outsourcing non-core activities ensures that these tasks are handled by experts, allowing GCCs to mirror the parent company’s goals without distraction.

For instance, while the parent company focuses on launching a new product in Europe, the GCC in India can seamlessly manage backend operations without missing a beat.

Setting up and running a GCC in India isn’t just about cutting costs. It’s also about understanding the local ecosystem.

Local consulting firms offer:

• • Regulatory Guidance: Navigating India’s labor laws, tax codes, and compliance requirements.
  • Cultural Alignment: Ensuring the operations align with India’s work culture and business practices.
  • Logistics Support: From office space to technology setup, these firms manage it all.

With routine tasks offloaded, GCCs have the bandwidth to innovate. Many successful GCCs in India have leveraged outsourcing to launch groundbreaking projects and scale rapidly.

For smaller businesses looking to establish a GCC, outsourcing non-core functions makes the process simpler and more affordable. They can tap into India’s thriving ecosystem without worrying about logistics or compliance.

Outsourcing partners handle:

• • Setup Prerequisites: Office space, IT infrastructure, and recruitment.
  • Ongoing Operations: HR, payroll, and administrative support.

With over 17 years of expertise, Inductus GCC specializes in helping businesses of all sizes establish their presence in India.

We provide:

• • Location assessments to find the best fit for your operations.
  • Resource allocation to meet your staffing needs.
  • Compliance management to ensure you meet local regulations.
  • Seamless operational setup so you can focus on your business goals.

1. Define Your Needs: Decide which functions will be core vs. non-core.
2. Partner with Experts: Choose a consulting firm like Inductus to guide you.
3. Set Up Operations: From location scouting to recruitment, let experts manage the groundwork.
4. Focus on Growth: With non-core tasks handled, direct your energy toward scaling and innovation.

Choosing Inductus means choosing:

• Experience: Over 17 years of success stories.
• Expertise: Local market knowledge and regulatory understanding.
• Efficiency: End-to-end support for a hassle-free GCC setup.

Outsourcing non-core functions isn’t just a cost-cutting measure—it’s a strategic advantage. By partnering with experts like Inductus GCC, smaller centers can scale efficiently, innovate faster, and align seamlessly with their parent organizations.

Ready to establish your GCC in India? Contact us at ho@inductusgroup.com and let’s make your expansion effortless.