Global Capability Centers (GCCs) have become a driving force for multinational corporations, operating as pivotal strategic hubs for cutting-edge software engineering & IT, R&D, and global operations.

As the sector experiences hyper-growth, it also battles a significant challenge — high attrition rates.

There are many reasons but the below few merits attention:

GCC’s Hyper Growth and not having great Employer Branding

GCCs are evolving at an unprecedented pace. According to Zinnov and NASSCOM, the Indian GCC market is expected to grow at a CAGR of approximately 9-10% over the next 5-6 years.

So is growth as would be demand for talent! GCCs vying for talent from the same pool and end up shaking the pot a little. This results in attrition.

In this situation, having a great employer brand comes to the rescue and arrests high attrition. A LinkedIn report states that 75% of job seekers consider an employer’s brand before applying, yet many GCCs are perceived as lacking in identity compared to their parent companies.

GCCs must invest in strong employer branding to differentiate themselves. High turnover can be linked to a disconnect between growth in business capabilities and the quality of work-life balance, compensation, and career development.

Lack of Clarity with the Parent Company

One significant cause of attrition in GCCs is the ambiguity regarding the nature of the work. Employees often feel they are perceived as back-office support rather than strategic contributors.

According to McKinsey, many GCC employees express dissatisfaction when their work lacks visibility and alignment with strategic goals.

A survey by Gartner found that employees are more engaged when they understand their impact on broader company objectives.

To tackle this, regularly align teams with the parent company’s strategic vision through communication and inclusion in key projects. Highlight the direct contribution of GCC work to global outcomes in company-wide meetings and reports.

Power Centres Leading to Workplace Conflicts & Politics

As GCCs grow in size and influence, they may evolve into power centres within their organizations. This change, while a testament to their importance, can lead to internal politics that erode trust and job satisfaction.

A survey by SHRM (Society for Human Resource Management) highlighted that nearly 55% of employees cited workplace politics as a major reason for job dissatisfaction.

Political environments may lead to favouritism, unequal distribution of resources, and decision-making delays. As a consequence, talented employees are more likely to leave to find transparent and equitable work cultures.

To mitigate this, establish clear policies for merit-based work allocation and ensure transparency in decision-making. Also, foster an inclusive culture where all branches and teams feel equally valued and heard.

Biased Leadership Attitude

Typically, a large MNC having GCC will have multiple global GCC sites. It has been noticed that leadership biases are prevalent. This favouritism, whether conscious or not, can create feelings of alienation among employees in other regions.

For instance, if a company’s main office shows a preference toward operations in India over those in Poland or the Philippines, this can spark disengagement and resentment.

Research from Harvard Business Review shows that teams with geographically biased leadership are 30% less productive.

The solution for this is to implement rotational leadership programs to give leaders exposure to different locations. Utilize anonymous feedback mechanisms to identify and address biases.

Workload Imbalance and Burnout

Work-life imbalance and burnout are common grievances within the GCC sector.

The tragic incident at EY’s Pune office, where an employee’s excessive workload contributed to her suicide, has underscored the severe consequences of unmanageable work cultures.

This highlights the need for improved work-life balance policies. The World Health Organization (WHO) has officially classified burnout as an occupational phenomenon, which increases talent turnover by up to 63%.

To manage burnout and promote more work-life balance, GCCs can introduce robust wellness programs and enforce no-overtime policies.

They can ensure realistic project timelines and fair distribution of work to maintain employee health and morale.

Conclusion

Growth always brings challenges. Talent is at the core of everything. Any GCC putting focus on resolving the above-mentioned prominent causes for high attrition will win this game of talent acquisition.

GCCs also need to focus on building an inclusive workplace where every single employee feels connected and appreciated. Building healthy relationships with your team members goes a long way to retaining the top talent.