Global In-House Centers (GICs) which were also known as Captive Centers are offshore centers that perform designated functions for large organizations. Wayne Townsend, President- Technology of Epsilon was in Bangalore to inaugurate HUB 2 as part of Epsilon's further expansion into India. Epsilon provides a broad range of marketing services spanning database marketing, direct mail, email marketing, web development, loyalty programs, analytics, data services, strategic consulting and creative services, among others.
People Matters spoke to Wayne about the opportunities that GICs are creating for India.
Q. How would you articulate GICs? And why has India emerged as a top destination for Global In-House Centres (GICs)?
A: Global In-house Centres initially began as an economic option for large corporations to expand globally. However, the status of GICs has improved alongside increased globalization in the world economy. Today, many GICs are centres of strategic importance helping to deliver on the requirements of global clients and make decisions as part of global organizations.
A good number of Fortune 500 companies have chosen India to set-up their GIC and over the past 10 years, more than 800 multinational corporations have chosen India as their preferred choice for global delivery. This is because India’s labor pool is full of innovative talent in technology –both experienced and emerging. As a result of this talent, GICs in India have become drivers of global initiatives, enabling digital transformation and providing cost savings with continuous improvements for delivery organizations.
Q: How are GICs evolving in India? Could you share insights from Epsilon’s own business context?
A: The GIC story in India continues on its growth path. Previously, it was a market for low-cost labor but the role of GICs has transformed into something bigger. GICs in India has now become imperative in terms of generating revenue and creating employment opportunities that add value for parent firms.
Recognizing the technology talent in India, Epsilon chose Bangalore specifically because it is the technology hub of India. In the last year, we hired about 1,300 associates into diverse segments including creative, analytics and digital marketing. Associates in India provide insight and strategy support for Epsilon’s global client base focusing on strategically combining rich data, analytics, creativity, and technology, to create powerful marketing campaigns. Our plan this year is to increase the number of associates to 1,800 and to start working with Indian based brands.
Expanding rapidly in this region requires us to think differently and strategically about how to attract top talent. Diversity is critical to our growth and long-term success. In fact, Epsilon has a 50:50 initiative in place to achieve gender equality among women and men in Epsilon’s India workplace by the end of 2018. Additionally, to encourage women into the workforce, we have a formal referral program in place, where if associates refer a woman and she gets employed, Epsilon supports the education of a female child in India and offers associates a referral bonus.
Q: Are GICs based in India ready to tackle a digital-first business environment?
With digital disruption and technology-driven change, organizations need to evolve constantly and rapidly, which is a challenge that crosses all borders.
According to the April 2017 Bain report, the GIC landscape has grown over the last 20 years to 1,100, organizations employing more than 800,000 individuals and generating approximately $23 billion in revenue, which is a rich market to tap into. The diverse, technology-driven talent pool in India is an advantage for GICs based here but like any organization GICs require an unending focus on optimizing traditional practices, rigorously developing high-skilled talent and ensuring they are adaptive to change.
To help adapt to change, the study also suggests that organizations are likely to expect more senior enterprise leaders (particularly two levels below the CEO) to be based out of Indian GICs. This, in turn, helps to shift the focus and make GIC initiatives more strategic. However, the same study reported that Indian GICs need improvement in terms of leadership quality, domain expertise and automation including machine learning and artificial intelligence. Nonetheless, Indian GICs must focus on a few factors such as becoming an analytics centre of excellence with an ability to deliver high-quality leadership with deep domain knowledge. Developing this kind of a holistic approach will ensure a fool-proof strategy to tackling the digital first business environment.
Q: What is the one thing that HR professional should know about GICs in the current context? Are skills the only focus area?
A: HR professionals should know that India is no longer just a resource bay, it has its own identity to develop and nurture top talent and add strategic value to parent organizations.
The key priorities for the future of GICs include business accountability and building a world- class talent hub and a centre for analytics and data. Apart from scouting for these skills, organizations need to address the challenge of grooming the digital workforce to meet demands and provide competitive benefits and unique offerings that keep talent engaged.