Did you know that Global Capability Centers (GCCs) are no longer just cost arbitrage centers? According to a recent survey, GCCs are now transitioning into Global Value Organizations with a focus on innovation and transformation. This means that these centers have become an integral part of the business world today.
However, GCCs face several challenges in their efforts to become more agile. These include the unavailability of expert resources, rising operational costs, and complex regulatory compliances. The solution to this is Operations-as-a-Service (OaaS). It can help overcome such challenges. This, in turn, helps streamline operations with a focus on innovation and growth.
Challenges Faced by GCCs
GCCS often face some challenges that make their operations less efficient. Here is a detailed look into them:
- Shortage of Skilled Staff
One of the primary challenges is getting the right talent to handle your operations either domestically or for the globally distributed team. For example, if you are a part of the industry that requires finance and accounts personnel, it may be difficult to find accountants who have the aptitude as well as experience. This can lead to delays and inefficiency in finance and accounting operations. In addition, getting skilled staff is not easy as other companies may bargain for the same.
- High Running Costs
High running costs are another challenge that GCCs face. It is an expensive affair to manage and run operations that require significant investment in human resources, technology, and infrastructure. For instance, an IT support services company will have to invest heavily in expensive software and hardware to keep its services secure and reliable. This is a huge financial burden, especially to the small GCCs. They may also be in trouble while controlling operational costs due to fluctuations in exchange rates and inflation.
- Regulatory Compliance Complexities
Complying with local laws and regulations is like walking a tightrope – it is critical and expensive, and one wrong step can lead to huge fines and other legal penalties. GCCs are required to be compliant with the local laws and regulations. For instance, when you are operating in India, you need to follow the country’s labor laws, tax laws, and even data privacy laws. Not following these regulations can lead to huge fines as well as other legal penalties. Moreover, GCCs need to keep up with changes in regulations and ensure compliance across multiple jurisdictions.
How Operations-as-a-Service Help GCCs
As mentioned earlier, OaaS resolves the challenges faced by GCCs. How? Here’s a look into it:
- Cost Savings
With Operations-as-a-Service, you only pay for the services that you use, which can give your organization huge savings on your operational costs. You can save on employment costs including recruitment and training of in-house accountants by outsourcing the accounting and finance operations to an external provider. Also, Operations-as-a-Service reduces the need for high-cost infrastructure and technology investments by a business.
- Access to Skilled Employees
You can also access skilled employees that you may not have internally or in your global team. For instance, if you outsource your IT support functions, you get to involve third-party service providers who are IT support experts. Hence, you overcome the challenge of finding and keeping highly skilled employees.
- Regulation Compliance
Service providers ensure local laws and regulations when it comes to Operations-as-a-Service. Look at it this way – outsourcing your human resources activities will give you an opportunity to appraise services from third-party providers who have good knowledge of the local labor laws and regulations.
- Enhanced Efficiency in Operations
Service providers excel in specific areas of operation and possess the knowledge that will eliminate inefficiencies. In case you outsource your procurement operations, you could benefit from third-party service providers who are already into partnerships with suppliers. So, they may be able to negotiate better prices for you.
How to Implement OaaS in Your GCC Operations
Here is a checklist for you to follow to implement OaaS in your GCC operations.
- Assess Your Current Situation
Before adopting OaaS to GCC operations, it’s important to assess your current situation. Identify areas that need improvement and the ones that are working well.
- Define Your Objectives
Define what you want to achieve or expect while implementing OaaS in GCC operations. This will help you stay focused and measure the success of your implementation.
- Create a Roadmap
Create a roadmap that lists the steps that you need to take in implementing OaaS in GCC operations. This includes timelines, milestones as well as key performance indicators (KPIs).
- Constitute a Team
Bring together experts to help you in implementing OaaS for GCC operations. Involve people from different departments, either domestically or from the global talent hub, who can bring their unique expertise and experience.
- Communicate Effectively
Communicate with your team and stakeholders about the benefits of implementing OaaS. This will help get the buy-in from all parties involved.
- Implement and Monitor
Proceed to put the changes into effect, continuously monitoring their progress. Adjust them as necessary to achieve the desired objectives.
Optimize Your Business Operations with OaaS
OaaS is like having a genie that streamlines your business operations; it lets you optimize your all activities by streamlining your operations and delivering what resonates with your business objectives. It is a flexible and scalable solution that enables the GCCs to focus on their core competencies while offloading their non-core operations with the experts. The process leads to effective cost reductions, access to skilled resources, as well as compliance with regulatory demands.