India’s GCCs shift from cost centers to product builders

At DevSparks Chennai 2026, Kewyn George, a leader in India’s global capability centers (GCCs), outlined a quiet but decisive shift: these offshore hubs are moving from executing back-office tasks to owning full product development. The change reflects a broader trend among multinational enterprises, which have spent years scaling engineering teams in India only to discover that cost arbitrage alone no longer justifies their presence.

The model is evolving. Where once these centers handled maintenance, testing, and incremental updates, they are increasingly being tasked with building core products—from AI-driven analytics platforms to proprietary SaaS tools. The transition mirrors a pattern seen in India’s startup ecosystem, where companies like those in W Health Ventures’ portfolio are being incubated in-house rather than funded externally. The difference here is scale: GCCs are attempting this within the constraints of large, risk-averse enterprises, not lean, venture-backed teams.

The implications are twofold. For India’s tech workforce, the shift demands a new skill set—one that goes beyond execution to include product strategy, user research, and even go-to-market planning. This aligns with the broader upskilling push in the country’s IT sector, though the pace of adaptation will vary. For multinational corporations, the bet is that India’s engineers can now deliver more than just labor savings; they can drive innovation. If successful, this could redefine the role of offshore teams, turning them from support functions into centers of gravity for product development.

Yet the transition faces hurdles. GCCs operate under rigid corporate structures, where budget approvals, compliance, and global alignment often slow decision-making. Startups, by contrast, can pivot quickly—a flexibility these centers lack. The challenge will be whether India’s GCCs can balance the agility of product ownership with the bureaucracy of enterprise governance. Some may already be testing this: internal tools could become standalone products, while others might integrate AI and fintech capabilities into core offerings, following the path of India’s TravelTech startups.

The shift also raises questions about the future of India’s IT services industry, which has long relied on GCCs as steady clients. If these centers start building their own products, they may reduce their dependence on external vendors, forcing Indian IT firms to either compete on innovation or double down on commoditized services. The Make in India initiative, now in its 12th year, has shown that production-linked incentives can drive exports; whether GCCs can achieve similar outcomes in software is uncertain.

For founders and investors, the trend offers a lesson in vertical integration. When W Health Ventures launched its $73 million fund last month, it chose to build startups internally rather than bet on external teams. GCCs are now adopting a similar playbook, but at enterprise scale. The coming year will test whether this model can deliver more than incremental improvements—whether India’s offshore teams can become the innovation hubs for global tech.

Sources: yourstory.com