Global In-house Centers (GICs) Remain Hot!

Enterprises continue to express their confidence in the shared services model as demonstrated by the continuing rise in Global In-house Center (GIC) launches across 2014. In fact, Everest Group research finds that Q4 2014 saw a 42-month high in GIC activity with 27 new set-ups and 3 expansions. As the chart below shows, 2014 experienced expansion in each quarter, while no center divestitures were reported during the entire year.

And this GIC activity has been a global affair. While Europe accounted for a third of that Q4 activity with 11 set-ups/expansions, many other regions experienced significant activity, as well. Within Europe, Ireland was the focus of most GIC activity, but Hungary, Lithuania, and Poland saw set-ups/expansions as well. The APAC region was busy with 10 set-ups/expansions, spread broadly across China, India, the Philippines, Singapore, and Taiwan.

Not to be left out, the Latin America region also experienced moderate activity with seven GICs launched or expanded. Costa Rica was the choice for several center locations, and Argentina, Brazil, and Chile each also netted a set-up/expansion. And finally, the Middle East/Africa (MEA) region got in on the action with a couple of launches/expansions.

Overall, this GIC market activity was driven by large MDR firms, which are demonstrating an increasing preference to leverage the shared services model. A larger proportion of new GICs are supporting voice and non-voice business processes, reversing a recent trend toward functional services support. Common areas include contact center, F&A, HR, analytics, marketing, procurement, and logistics.

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