Major mergers and spin-offs by IT service providers are rare, but when they occur (e.g., Xerox’s acquisition of ACS in 2010 and Atos’ subsequent acquisition in 2014, HPE’s 2017 spin-off of its Enterprise Services business and merger with CSC in the form of DXC), pause and consider your options. These are major corporate events that generally redirect a supplier’s focus and internal attention on change management, creating a new business model and developing a corporate culture—not easy stuff and in some cases can have a direct impact on “how” and “how well” services are provided to customers. At a minimum, important contracting work may preserve commitments and benefits of your existing deal.
Outsourcing service providers have long been in the practice of bringing highly skilled employees from India and other locations to work with local businesses within the United States. Outsourcers such as Wipro, TCS and Infosys are some the largest petitioners of H-1B visas, the high-skilled work visa favored by the tech industry. In order to bring the most value to customers, service providers largely rely on getting work visas for Indian tech workers so they can consult with U.S. businesses.
Global In-House Centers (GICs) were first seen in India in the 1990s as an alternative to IT outsourcing arrangements with third-party vendors. The principal driver was labor-cost arbitrage between the United States or Europe and India. The banking, financial services and insurance industries were early adopters. In their original iteration, GICs were known as “offshore captive centers.” A number of these captives were later sold to outsourcing vendors, particularly in the years following the Great Recession.
In recent years, there has been a resurgence of interest in GICs in India across a wider range of industries, including transportation, telecom, media, manufacturing, medical devices, oil & gas, aerospace, retail and hospitality. In “Global In-House Centers in India, v2.0,” Pillsbury partners Jeff Hutchings and Craig de Ridder explore how GICs in India are evolving from cost-saving platforms into Innovation Centers for emerging digital technologies that can provide a competitive advantage.