Global Capability Centres (GCCs), once deemed merely as offshore cost-saving centres, have matured into centres of excellence that manage vital business functions, enable strategic initiatives, catalyse innovation and create value for the organisation. But as enterprises explore different GCC models, a pressing question arises: Which path delivers the fastest, most sustainable strategic outcomes—building a captive centre or partnering with third-party providers?
While captive models offer control and cultural alignment, third-party service providers bring unmatched scale, agility, and continuous innovation that are increasingly essential in today’s hyper-dynamic business landscape. This blog explores how GCCs are transforming globally, compares growth models, and highlights the strategic advantage of third-party partnerships in achieving greater long-term business value.
where GCCs are heading: global trends and market signals
GCCs are expanding rapidly worldwide, driven by factors such as talent availability, cost advantages, and digital transformation. Here’s a data-backed analysis of key emerging trends:
- global presence
- With approximately 5,300 GCCs worldwide, India leads with over 1,700 GCCs, capturing more than 33% of the market.
- New GCCs hubs are emerging in countries like Colombia, Costa Rica, Malaysia, Philippines, and Poland, offering new opportunities and access to regional growth.
- talent pool and cost advantages
- Home to 28% of the global STEM talent and 23% of global software engineering talent, India is the top destination for GCCs.
- With up to 40% lower operational costs than in Eastern Europe, India offers significant savings for MNCs.
- industry participation
- Banking, Financial Services, and Insurance (BFSI), Retail, Logistics and Information Technology-enabled Service (ITeS) sectors have been early adopters of the GCC model. Non-traditional sectors like Quick-Service Restaurants (QSR), Manufacturing, EdTech, Hospitality, and Agriculture are also increasingly establishing GCCs.
- tech adoption
- In line with the current tech landscape and need for accelerated outcomes, approximately 70% of GCCs are focused on investing in Generative AI (GenAI). This shift in mindset and adoption of technology is projected to completely change the GCC landscape in the next 2 years
captive, third-party or hybrid? choosing the right growth model
As enterprises evaluate global delivery models, a key strategic choice arises: Should enterprises build a captive Global Capability Centre (GCC) or partner with a third-party service provider? Each model offers distinct advantages and trade-offs that can significantly influence long-term business value.
captive GCCs: control with commitment
Captive GCCs are fully owned offshore or nearshore entities established by parent organisations to manage operations, innovation, and support functions internally.
benefits:
- Full control and integration: Captives operate as an extension of the parent company, aligning closely with internal culture, standards, and strategy.
- Cultural Alignment: Direct management ensures alignment with the parent company's values and goals
- IP and data security: Sensitive work such as R&D, proprietary technology, and regulatory functions stay within organisational boundaries.
- Talent incubation: Captives often become hubs for niche skill development and leadership pipelines.
challenges:
- High setup costs and delayed ROI: Establishing a GCC demands significant upfront investment, with value realisation often taking years.
- Time-Consuming Setup: Establishing an in-house GCC can take 6–12 months due to the need to handle company registration, office setup, compliance, and recruitment
- Scalability and sustainability issues: Many GCCs struggle to scale beyond initial mandates, facing challenges in talent, infrastructure, and evolving business alignment.
- Limited value creation: A majority of GCCs remain cost centres rather than value drivers, with few transforming into strategic growth engines.
- Risk of insularity: Over-reliance on internal resources and narrow cost-focus can isolate GCCs from 360-degree view of innovation, market trends, and holistic business planning and readiness.
third-party providers: scale with agility
Third-party service providers offer outsourced delivery of business and technology operations, ranging from core processes to advanced digital services under flexible engagement models.
benefits:
- Speed, scale, and specialisation: They bring mature delivery models, pre-built accelerators, and domain expertise to drive faster outcomes.
- Commercial models: They offer flexible commercial models, varying from fixed-cost to outcome-based pricing models that help businesses manage costs while scaling operations. Additionally, their shared services function allows cost distribution across multiple clients and business units, reducing operational spend and lowering the total cost of ownership.
- Seed Talent: Partners bring established recruitment engines, local HR knowledge, and pre-vetted or seeded candidates that can hit the ground running
- Access to diverse talent: They invest in continuous upskilling and global talent networks, ensuring consistent access to specialised skills across domains and adapting to regional business needs.
- Continuous innovation: By investing in emerging technologies and R&D, third-party providers drive continuous innovation and embed new solutions directly into operations, accelerating go-to-market strategy, enhancing market relevance, and enabling faster scaling of new offerings.
challenges:
- Feeling of loss of control: With critical functions being managed externally, enterprises may feel knowledge and control shifting to third-party providers. Strong governance, close collaboration, and strategic alignment need to be actively managed to maintain strategic control.
- Dependency on service providers: Over reliance on third-party providers can reduce flexibility, especially in areas like change management, control and compliance, and data management. Strong oversight, KPIs, and clear contracts are key to mitigate lock-in risks and maintain strategic control.
strategic advantage of the hybrid GCC model
GCCs should not be approached as a three-year cost-saving tactic. To be truly effective, they require a strategic and long-term mindset anchored in flexibility, agility, and resilience, which neither captives nor third-party models can singularly provide. A well-designed hybrid GCC model enables enterprises to:
- Have a clearly defined end-state aligned with business outcomes
- Invest in leadership development and workforce upskilling
- Leverage advanced AI and automation-led innovation and digital-first operations
- Build deep collaboration with global HQs to foster integration, adaptability, and a future-ready talent ecosystem
- Create a continuously evolving delivery engine to remain competitive and future-ready
In today’s dynamic business landscape, the pace of disruption is relentless, and the demands of digital transformation are only intensifying. Captive GCCs, while valuable, require significant time, investment, and operational maturity to deliver consistent value. Many enterprises simply can’t afford that runway.
This is where third-party providers offer a compelling strategic advantage. Their ability to set up GCCs for clients through Build Operate Transfer (BOT) or BOT plus Transformation models or through Talent augmentation models or ‘As a Service’ models that allow GCCs to scale up and achieve Digital transformation of their processes.
Third-party providers can enable faster mobilization of talent, outcome-driven delivery, and continuous innovation, without the overhead of ownership. With the right partner, businesses can achieve agility, access deep domain expertise, and scale faster than captives typically allow.
conclusion
As GCCs redefine their role from operational support arms to strategic growth enablers, enterprises must rethink their setup and scaling strategies. The traditional captive model, while offering control, often lacks the flexibility, speed, and innovation required in today’s market. Third-party providers, on the other hand, combine deep domain expertise with proven delivery frameworks, helping clients unlock value through faster and smarter scaled GCC setup and expansions. Enterprises must adopt hybrid operating models that offer the control of captives and the agility of third-party partnerships. This approach ensures speed, innovation, and sustained value.
Partnering with the right service provider enables strategic differentiation. Infosys BPM has stood out as a strategic partner with over 20 years of experience delivering value to organisations across captive, hybrid, and third-party GCC models. With deep industry expertise, process excellence, and a future-ready digital ecosystem, Infosys BPM has helped clients drive transformation at scale. Our focus on value realisation goes beyond cost optimisation. We enable enterprises to enhance customer experiences and navigate change, while ensuring quality, compliance, and alignment with strategic intent.
Get in touch with our team today and navigate your next with confidence.
