How Global Capability Centers are Redefining Service Provider Relationships

Global capability centers (GCCs) are undergoing a profound transformation. Once primarily designed for cost arbitrage, they are now evolving into enterprise centers responsible for innovation, data-led decision-making and AI-enabled delivery. At the same time, GCCs face rising pressure from headquarters to reduce costs while accelerating innovation — a dual mandate that cannot be met by internal capacity alone.

This is where IT service providers become critical. ISG is observing a trend in which service providers are increasingly becoming strategic partners in GCC growth. ISG research shows that over 80% of India-based GCC leaders are open to engaging new service providers in the next two years — significantly higher than their corporate HQ peers. Moreover, 60% of GCCs plan to increase their use of IT services over the same period. In response, service providers are creating offerings specifically tailored to GCCs.

To thrive, GCCs should consider a co-creation operating model with their providers. By shifting to outcome-based commercial models, adopting a portfolio view of build vs. buy and embedding providers into AI and data programs, GCCs can unlock speed, scale and resilience – for both themselves and for the broader enterprise.