What factors do investment banks and consulting firms consider before advising a client to set up a GCC in India

When global firms look at setting up a Global Capability Center (GCC) in India, investment banks and consulting firms usually assess both financial viability and operational feasibility. Some of the key factors include:

1. Cost-Benefit Analysis
   • They examine the potential savings on labor, infrastructure, and operations compared to other global locations.
   • At the same time, they assess whether these savings are sustainable in the long term, factoring in rising wages and competition for skilled talent.
2. Talent Availability
   • India’s strength lies in its vast pool of skilled professionals in IT, analytics, R&D, and financial services.
   • Advisors look at whether the required skill sets (e.g., data science, fintech, AI, cybersecurity) are available in the preferred city.
3. Regulatory & Compliance Environment
   • Legal frameworks, labor laws, tax policies, and data security regulations are carefully evaluated.
   • Firms ensure clients understand compliance obligations, especially in highly regulated industries like banking and healthcare.
4. Location Strategy
   • Cities such as Bengaluru, Hyderabad, Gurugram, and Pune each offer different advantages in talent, infrastructure, and connectivity.
   • Advisors consider local ecosystem strengths (e.g., tech in Bengaluru, finance in Gurugram).
5. Operating Model & Governance
   • A GCC’s success depends on integration with the parent organization.
   • Consulting firms often help clients decide whether the GCC will act as a cost center, a center of excellence, or an innovation hub.
6. Risk & Scalability
   • Factors like geopolitical stability, business continuity, cybersecurity, and scalability of operations are also weighed.
   • Advisors need to ensure the GCC can grow with the company’s global strategy.