Global In-house Centres (GICs) in India deliver significant value to their parent companies. But for these centres to optimise performance and move up the value chain − from cost centres to quality centres to innovation centres – they need to be able to benchmark their performance against their peers and make the right investments at each level of maturity. Professor Deepa Mani who led the effort to develop a capability maturity index for GICs in India, in conjunction with Deloitte Consulting and NASSCOM, shares the key results of her study.
The offshoring of business activity, to global in-house centres (GICs) or wholly owned and operated subsidiaries in emerging economies such as India, is fundamental to the business model of the modern multinational company (MNC). More than 750 MNCs have established GICs in India across a range of industries. While the early entrants were primarily seeking to reduce the ownership costs of business activity and acquire competencies for scale; over time, MNCs have made a strategic shift from regarding GICs as cost centres for offshore production or opportunistic exports to considering them as centres of excellence that drive product innovation, improve speed to market and help capture the latent value in host markets. Indeed, offshored tasks increasingly include product and process design, engineering and other core processes.